According to the recent findings from the Department of Education’s Office of Inspector General (OIG), the Chicago Public Schools (CPS) district has been found to have misused federal grant funds by falsely classifying South Asian students as Native American. This led to the misallocation of over $1.1 million, with a significant portion of this amount being attributed to the period leading up to 2022. As a result of this misclassification, CPS will be required to repay the federal government the amount of a million dollars.
The investigation, which began in 2021, involved a thorough review of the CPS student databases and found that a large number of students with South Asian surnames were incorrectly labeled as Native American. The ED OIG concluded that CPS officials were aware of the potential misclassification but intentionally submitted false data for the purpose of qualifying for additional federal funding. This misclassification led to over $140,000 in extra funds during the 2022-2023 and 2023-2024 school years, with the misallocated funds extending back to previous years. The ED investigation also determined that these funds were not only misallocated but also not justified, as the students in question were not of Native American ancestry.
Following the settlement, CPS officials have stated their commitment to rectifying the situation by enhancing their data collection and verification processes to ensure the accurate classification of students for future grant applications. The district has also decided not to apply for the American Indian Education grant for Fiscal Year 2026, opting for a more cautious approach to ensure full compliance with the federal requirements. However, the ED continues to assert that CPS officials knowingly submitted false data despite the district’s claims that they worked closely with federal agencies to correct the errors.