Rigged School Lottery: Philly Charter School Pays $4M Settlement

When families enter a school admissions lottery, they expect one basic principle above all else: fairness. Everyone’s name should have an equal shot in the bucket.

However, federal investigators revealed that a popular Philadelphia charter school rigged the game—prompting a major federal settlement that serves as a stern warning to federally funded schools across the country.

Franklin Towne Charter High School and its former CEO, Joseph Venditti, have agreed to pay nearly $4 million ($3,914,328.77) to settle allegations that they manipulated their admissions lottery to deliberately discriminate against Black applicants.

What Happened?

Public charter schools rely heavily on federal and state grants to fund classrooms and programs. Under Title VI of the Civil Rights Act of 1964, any educational institution receiving federal money is legally forbidden from discriminating on the basis of race, color, or national origin.

According to the U.S. Attorney’s Office for the Eastern District of Pennsylvania, Franklin Towne violated that agreement during its January 2023 admissions lottery.

Federal officials contended that:

• The school—acting through or at the direction of then-CEO Joseph Venditti—tampered with what was supposed to be a blind, random selection process.
• The adjustments were made specifically to lower the chances of Black students gaining admission.
• Because the school accepted federal taxpayer dollars—including funds under the Elementary and Secondary Education Act and pandemic relief grants—while discriminating in its admissions, it breached federal rules and ran afoul of the False Claims Act.

“Racial discrimination has no place in school admissions. Selecting or excluding students because of their race is illegal and violates the agreements schools sign when they accept federal grant money.”

— David Metcalf, U.S. Attorney for the Eastern District of Pennsylvania

Breaking Down the Settlement

The multi-million-dollar resolution was split based on each party’s ability to pay:

• Franklin Towne Charter High School: Will pay $3,639,328.77.
• Former CEO Joseph Venditti: Will personally pay $275,000.00.

(Note: Under the terms of the settlement, the claims are considered allegations, and neither party has admitted legal liability.)

Moving Forward: Rebuilding Accountability

Beyond the monetary penalties, the U.S. Department of Justice noted that the school has undergone significant structural reforms to prevent this from ever happening again:

1. Leadership Changes: The school replaced Venditti as its Chief Executive Officer.
2. Third-Party Oversight: Franklin Towne has hired an independent third-party organization to run and verify all future admissions lotteries.
3. Cooperation: Federal prosecutors acknowledged the charter school’s remediation steps and ongoing cooperation during the resolution process.

Why This Matters

Public charter schools are intended to expand educational opportunities for local communities, not create backdoors that shut specific communities out.

This case sends an unmistakable message to school administrators everywhere: public dollars come with public accountability. If a school uses federal funding, it must guarantee equal access—and tampering with the odds against students of color carries serious legal and financial consequences.