Forensic review and closing administrator expose financial mismanagement at Nevada Prep; board continues breach notice

A forensic accounting presentation and a separate closing-administrator report presented to the State Public Charter School Authority on Jan. 6, 2026, showed pervasive financial-control failures at Nevada Preparatory Charter School that left the school insolvent and exposed students and vendors to operational risk.

Green Flash Forensic Accounting told the SPCSA that the firm’s review of fiscal years 2022–23 found a “global, lack of quality or lack of recordkeeping” for transactions, particularly debit-card and Amazon-account purchases, that prevented investigators from substantiating many whistleblower allegations. “We were unable to substantiate these claims because of lack of information, lack of documentation,” Green Flash’s John Jura said during the presentation.

Independently, SPCSA-appointed closing administrator Josh Kern described immediate problems he found when he assumed control Dec. 12, 2025: an overdrawn bank account, months of unpaid essential services, and vendor obligations exceeding half a million dollars. Kern highlighted an Oct. 13, 2025, sale-of-receivables (factoring) agreement in which Nevada Prep received about $121,875 and was obligated to repay roughly $170,000 with weekly remittances — a financing structure Kern said produces an effective interest rate “approaching 100%.” Kern said the school had also prepaid $89,000 to a former board chair’s investment firm days before Kern’s appointment, a transaction he described as contrary to Nevada Prep policy and potentially at odds with state ethics provisions.

Kern also reported operational and safety concerns: an unlicensed fee-based after-school program with commingled cash receipts, transportation vans that were not properly inspected or permitted, an elevator left unsecured, and multiple active plumbing leaks. He said some state reimbursements had been withheld while the Nevada Department of Education’s corrective actions remained incomplete.

SPCSA General Counsel Samantha King Powell said the forensic report “more than addresses the whistleblower complaint” and that where the staff identified facts that suggest possible misuse of public funds, the authority will refer those findings to the Nevada Attorney General’s Office for further investigation.

Kern described immediate remedial actions taken by the closing team: assuming control of the school’s bank account, restricting spending without his authorization, transferring accounting oversight to Higgins and Associates, paying essential services except rent, auditing personnel files, clawing back unauthorized overpayments where possible, and making PERS payments current going forward. He asked the SPCSA to pursue rent relief negotiations with the school’s landlord and to convert the SPCSA-appointed closing-administrator role to a court-appointed receivership to gain additional legal protections and authorities.

The board voted to continue Nevada Prep’s financial notice of breach and to require ongoing oversight while Kern’s team works to stabilize operations through the end of the school year. Samantha King Powell told the board she and staff are preparing paperwork to seek a court-appointed receivership and said staff will file a motion to request that Kern be appointed receiver.

What happens next: The authority will continue oversight through the closing-administrator/receivership process, pursue recovery of unauthorized payments where possible, and refer evidence of possible criminal misuse of funds to the Attorney General for investigation.