He was on the lookout for outfits such as Jacksonville's Cyber Tech Academy, to which the state had paid $54,000 in tuition through 2004 despite the fact that the school didn't physically exist.

That's as proactive as any investigation ever got, says Stoughton, a former Tallahassee Police officer. From 2005 through 2008, he worked with three to four colleagues in the DOE's Office of Inspector General. "I never got the sense that we really got a good grasp on the scope of potential fraud," he says.

Registering a private school is as easy as filing minimal start-up paperwork. Becoming eligible to receive McKay payments isn't much tougher and relies mostly on the honor system: You must claim to have a location, promise to run background checks on staffers, and either have been in business for three years or have access to a surety loan or line of credit. "The restrictions on opening a school are so relaxed," Stoughton says, "that it's almost a right rather than a privilege."

The DOE has investigated 38 schools suspected of McKay fraud. In 25 cases, the allegations have been substantiated. Of those, five — Muskateer's Academy, Paladin Academy, Choice Preparatory School, Center of Life Academy, and Hope Academy — were in Miami-Dade.

The thieving schools across the state received, or in many cases are still receiving, McKay money totaling $49.3 million.

In the 27 investigative reports that were made available to New Times — the rest have been purged — the vast majority were sparked by a tip, usually from an associate with an ax to grind. A few of the more notable cases:

• At Homestead's Hope Academy, recipient of $2.8 million from McKay, a 2010 investigation revealed at least three staffers had criminal records. One of the employees had pleaded guilty in Georgia to intent to distribute cocaine. Another had served two years in the same state for the sale of marijuana. The school is the target of a lawsuit filed by a mother who claims her developmentally disabled daughter was repeatedly molested by a classmate on a school bus and that principal Cecil Persaud did nothing about it. Visited by New Times, Persaud — a gray-toned man with a patchy mustache — claimed the fraud "didn't ring a bell," refused to discuss the molestation lawsuit, and threatened to call police.

• The most common caper involves simple forgery: school administrators doctoring attendance records and signing parents' names to show that students are enrolled when they're actually not. Jacksonville's Success Academy — which received $4.8 million — was likely the largest such case. From 2001 through 2005, the school accepted $421,000 for 52 students who were enrolled in public schools.

• At Muskateer's Academy in Hialeah (Stoughton says of the name: "I think they just had no idea how to spell"), husband and wife school owners Jacqueline and Erick Cermeno were indicted for stealing several students' disability information to falsely enroll them and pocket thousands in tuition. Muskateer's received $794,000 from the state. The Cermenos were sentenced to ten years' probation and seem to have disappeared to Texas.

But some of the most egregious offenders have evaded even a slap on the wrist. In February 2008, Stoughton's office held countless hours of deposition and prepared a damning 795-page report in exposing a similar $78,000 fraud at Harvest Christian Academy in Tampa. The principal, Bishop Michael Wayne Lewis, was already serving five years in federal prison for a $3 million bank fraud case. Lewis scoffed that because "he was currently incarcerated for a scheme involving the theft of $3 million," according to a report, "he would not 'waste' his time with $78,000."

The State Attorney's Office (SAO) apparently agreed, deciding not to press charges. "This was a case I had worked on the entire time I was there," Stoughton says. "It was incredibly frustrating."

The apathy to McKay fraud was politically motivated, he believes. "This program was the governor's baby, and he had a lot of political capital invested in this," the former investigator says of Bush, who held office until January 2007. "My understanding was that he viewed our investigations as negative publicity about the program."

Counters Bush's spokesperson Jaryn Emhof: "Governor Bush has consistently supported greater accountability over the scholarship programs."

Of the case reports provided to New Times, only three resulted in arrests. The vast majority of offenders were ordered to simply repay the stolen money, although many of them have failed to make payments.

In October 2007, prosecutors did decide to press charges in a case involving two sisters. Betty Mitchell and Jeannette Nealy had swindled at least $200,000 in McKay money through Faith Christian Academy in Polk County.

Stoughton helped the SAO write a news release, detailing the fraud and the sisters' potential prison time — they would later be sentenced to a combined 17 years — to send to media outlets. There's no deterrent to like-minded schemers, Stoughton believes, like a nice, scary news story.

When Stoughton shipped a draft of the release up the flagpole at the Department of Education, he says, "The response I got was essentially: This is good news how?"

Stoughton eventually left the department to go to law school. The DOE never sent out that news release.

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