No. of Recommendations: 0
It all fits in with personalities that are interested in conning people, cheating people. Ethics be damned. I ran away from "Stride" (LRN) today.
This item hit the wire last Wednesday:
Gallup-McKinley Schools Sue Stride for Fraud and Misconduct.
The complaint asserts that Stride executives knowingly inflated enrollment numbers by retaining "ghost students" on rolls to secure state funding per student. Additionally, the company cut staffing costs by assigning teachers' caseloads far beyond the required statutory limits, with some teachers having more than 200 students each. Furthermore, Stride ignored compliance requirements, including background checks and licensure laws for its employees, and neglected federally mandated special education services for students
The complaint also alleges that Stride suppressed whistleblowers who documented financial directives from the company's leadership to delay hiring and deny services to preserve profit margins. According to whistleblower testimony, senior Stride finance executives explicitly rejected requests to hire additional teachers, even when warned that the company violated a New Mexico statute. Instead, executives ordered additional staff cuts to ensure profit targets were metainvest.com - Gallup mckinley schools sue stride fraud misconductEven though the news was out last Wednesday, the stock did not react, until today "BaWOOOSH"
We all know what management will say "this suit is without merit, we will defend ourselves vigorously"
But the fact remains, a well established company, in that field, should not see it's stock go up over 100% over the past year. A Saturn V trajectory makes it hinky. There is a better than even chance management was cooking the numbers, as alleged in the suit, to line their own pockets.
I will now be watching proceedings at the company, from a safe distance.
Steve
