School & District Management

Former Puerto Rico Ed. Secretary Arrested, Charged With Fraud

By Andrew Ujifusa & Evie Blad — July 16, 2019 4 min read
Former Education Secretary Julia Keleher works with her team in a makeshift office at the Convention Center of Puerto Rico in San Juan in October 2017 after Hurricane Maria devastated the island.
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Julia Keleher, the former education secretary of Puerto Rico, was arrested by federal agents in Washington last week on fraud charges stemming from allegations that she improperly steered millions of dollars in government contracts to consulting firms, including one run by her close friends.

Keleher, 44, faced praise and sharp criticism as she led the territory’s school system, which educates more than 300,000 students, through the aftermath of Hurricane Maria in 2017. Education Week followed Keleher, as well as her supporters and critics, during multiple reporting trips to the island as it traced the school system’s difficult recovery. She stepped down three months ago, initially agreeing to remain as a paid adviser to Puerto Rico’s education agency before abruptly withdrawing from that position shortly thereafter.

Keleher was arrested along with the island’s former director of health insurance administration, Angela Avila, and contractors who worked with the insurance and education departments, U.S. Attorney Rosa Emilia Rodríguez Vélez said.

A grand jury indictment alleges she illegally steered a $95,000 Puerto Rico education department contract through a corrupt bidding process to an unqualified company run by her close associates at the consulting firm Colon & Ponce. It was run by sisters Glenda E. Ponce-Mendoza and Mayra Ponce-Mendoza. A separate count alleges a scheme through which Keleher and others awarded more than $13 million in department contracts that included $220,000 in illegal commissions. Keleher did not personally benefit from the scheme, Rodríguez said at a press conference.

“This type of corruption is particularly egregious because it not only victimizes taxpayers, it victimizes those citizens and students who are in need of educational assistance,” said Neil Sanchez, the special agent in charge of the southern regional branch of the U.S. Department of Education’s Inspector General’s office, which investigates misuse of federal education funds.

Keleher was released to return to Puerto Rico following an initial court appearance in Washington Wednesday, the U.S. Attorney’s Office said. Her arrest followed months of public speculation that she was under federal investigation. Messages left for Keleher last week seeking comment were not returned. In April, Keleher started a new research and marketing firm, Solution Partners, according to her LinkedIn profile.

Puerto Rico Gov. Ricardo Rosselló, who had appointed Keleher to the top education job, denounced those who had been arrested in a Twitter post last week. “No one is above the law. Everyone who fails must face the consequences,” the governor said.

Leading a System in Crisis

During her tenure as education secretary, which lasted more than two years, Keleher said she was intent on overhauling Puerto Rico’s public schools even before Maria hit the island.

Decrying a system that she said was inefficient and failed students, she broke up the department’s bureaucracy to provide more local control to different regions of the island, backed what became a landmark 2018 law to institute charter schools and vouchers, and approved the closure of hundreds of public schools because of low enrollment.

Before Maria hit the island, the public schools enrolled roughly 350,000 students. A year later, at the start of the 2018-19 school year, that number had dropped to 308,000. Last summer, Keleher’s department permanently closed 263 public schools, more than 20 percent of the total. That followed the closure of 179 schools in summer 2017, amid a $120 billion debt-and-pension crisis in Puerto Rico.

Her supporters said she was bringing much-needed change and energy to a system in which students had produced dismal academic results for years.

The federal Education Department backed the island’s attempts to expand educational options. In a 2018 speech, Frank Brogan, the assistant secretary for elementary and secondary education, said Puerto Rico would be a “beacon” of choice and a “laboratory” for people to observe.

But Keleher’s detractors, including the Asociación de Maestros de Puerto Rico, the island’s teachers’ union, alleged she was defying the will of parents and educators and shattering the island’s public schools in the name of unproven solutions.

In a Facebook post, the teachers’ union called Keleher’s arrest a “sad day” for the island’s public schools and highlighted its previous disagreements with Keleher.

Members of Congress also had criticized Keleher’s decision to close schools and Puerto Rico’s expansion of school choice.

“The proposal in Puerto Rico to transition to charter schools and the use of private school vouchers is one that mirrors what happened in New Orleans after Hurricane Katrina,” said presidential candidate Sen. Bernie Sanders, I-Vt., in March of last year, about three weeks before a bill creating charters and vouchers was signed into law by Rosselló.

A version of this article appeared in the July 17, 2019 edition of Education Week as Former Puerto Rico Ed. Secretary Arrested, Charged With Fraud

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