Calling a hedge fund partnership interest a "current asset"
by Rob Levine
Dec 17, 2021, 10:30 AM

A charter school feeds the hand that bit it

BY NOW MOST people who follow education in Minnesota are aware of the Hmong College Prep Academy’s illegal $5 million investment in a hedge fund that ended up losing $4.3 million, costing the power couple who run the segregated St. Paul-based charter school their jobs and casting doubt on the long term viability of the institution.

As the messy saga unfolded, an opaque school finance and consulting outfit called The Anton Group weighed in on the scandal with two blog posts, the first in June of 2021, and the second in late September. In a nutshell, Anton’s assessment was: This is fraud! The following month, something weird happened: Despite Anton’s very public criticisms of HCPA, the company landed a $100k contract to clean up the mess. A month after that, Anton’s Finance Manager became the Chief Financial Officer of the school itself. And sometime between that second blog post in September and the hiring of Anton in October those two blog posts were deleted.

So what in the name of all that grifts is going on?

The Anton Group describes itself on its website as “provid[ing]  a wide array of financial services to public charter schools, traditional public schools, and school support organizations.”  Though Anton claims it provides services to “30+ schools” and that its employees possess “100 years of combined school finance experience” none of its employees or principals, or the schools where they work, are named on the site. None of the blog posts it publishes are signed.

The first blog post, from June, is now lost to the Internet bits. But its filename suggests a scathing take: “charter-school-investment-goes-sour-and-was-illegal.” The September post, headlined, “The Fraud That Just Won’t Go Away” and viewable at, asserts that the school and its bond underwriters defrauded investors by claiming the $5 million hedge fund investment was still intact:

HCP closed its most recent round of bond financing in late September 2020. In the Official Statement, which goes into every detail of the bond financing and financial reports/projections, the investment is reported on the June 30, 2020 financial statements at a balance of $5,000,000. Said differently: the $5M fraudulent investment was made prior to the September bond financing. This means neither the school, nor the school’s accountants, disclosed the true nature of the investment during the underwriting period the proceeds any debt issuance.

The post concludes rhetorically asking:

Was the disclosure of the investment intentionally withheld from the bond underwriters, legal consul, and investors? The answer is obvious.

Not long after this was posted it was removed.  A short time later, on October 21, HCPA submitted a contract with The Anton Group for the school board’s approval that calls for a minimum of 650 hours work at $150/hr. (about $100k minimum).   With the hiring of The Anton Group HCPA then set out to hire a new CFO with the help of TAG and its Managing Director Mike Pocrnich, who joined the Transition Team.

The Anton Group had a hand both in defining the CFO job description and pay range, and the Transition Team with TAG’s Pocrnich then chose candidates to interview, and did the interviews.  Finally, earlier this month HCPA announced that it had hired as its CFO David Kloskin, whose LinkedIn bio says he was Finance Manager at Anton from 2019-2021.  It was like Dick Cheney being tasked to find a veep candidate, then deciding he’s the best choice.

The lawyer for HCPA, James Martin, said the school was unaware of the blog posts, which seems unlikely since Anton is apparently one of the leading finance firms for charter schools in the state, and  the posts were distributed locally on social media. But even if that is true it doesn’t absolve Anton as it deleted those blog posts while seeking work with the targets of its criticism, so at least they felt the posts could pose a problem. The conflict is compounded by the fact that the blog posts are unsigned, so we don’t know if people who are now profiting off the scandal were the ones fanning the flames.  Telephone calls and emails to Anton were not answered.

Was this an innocent case of institutions giving in to their critics and trying to do the right thing, or was it a case of getting a severe critic to back down by bringing them onboard?  And what about TAG’s behavior? It’s highly suspicious – pouring the opprobrium on a school only to rush in to put out the fire –  for a price.  Either way it’s just another black eye for the Hmong College Prep Academy and its Authorizer, Bethel University, who you would think would bend over backwards at this point to avoid any appearance of impropriety.

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