{"id":48214,"date":"2026-03-24T21:31:17","date_gmt":"2026-03-24T21:31:17","guid":{"rendered":"https:\/\/agooka.com\/news\/usa\/feds-opened-probe-of-california-school-districts-diplomas-for-chinese-students\/"},"modified":"2026-03-24T21:31:17","modified_gmt":"2026-03-24T21:31:17","slug":"feds-opened-probe-of-california-school-districts-diplomas-for-chinese-students","status":"publish","type":"post","link":"https:\/\/agooka.com\/news\/usa\/feds-opened-probe-of-california-school-districts-diplomas-for-chinese-students\/","title":{"rendered":"Feds opened probe of California school district&#8217;s diplomas for Chinese students"},"content":{"rendered":"<figure><img decoding=\"async\" src=\"https:\/\/i.insider.com\/69c2f11158b5806618e7df6a?format=jpeg\" alt=\"The Val Verde school district building\"\/><figcaption>The Val Verde school district had an unusual arrangement with a school in China.<\/p>\n<p>Christopher Vu for Business Insider<\/p>\n<\/figcaption><\/figure>\n<ul>\n<li>Business Insider investigated ties between a California district, a school in China, and education officials.<\/li>\n<li>The county education department referred the matter to federal prosecutors.<\/li>\n<li>Now, a scathing audit ordered by the county has also been sent to local prosecutors.<\/li>\n<\/ul>\n<p>Federal prosecutors opened an investigation into a Southern California school district&#039;s unusual ties to a boarding school in China after a Business Insider report on the arrangement, records show.<\/p>\n<p>The status of the probe that began in late 2023 is unclear. A highly critical audit, also prompted by Business Insider&#039;s reporting and released last week by state education authorities, has been referred to the local district attorney.<\/p>\n<p>Business Insider&#039;s 2021 investigation brought attention to the cozy relationship between the Val Verde Unified School District, top current and former state education officials, and Pegasus California School, a private school in Qingdao, China, that charges students thousands of dollars a year in tuition.<\/p>\n<p>Less than a week after the story was published, the Riverside County Office of Education contacted the Fiscal Crisis and Management Assistant Team, a state agency, to conduct an audit of the issues.<\/p>\n<p>County education officials later said in court papers that they were concerned that diplomas issued by Val Verde to Pegasus students violated state code, &quot;and that there may have been fraud, misappropriation of funds, or other illegal fiscal practices&quot; associated with the partnership.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/i.insider.com\/69bc987075bee4e0ee55e41b?format=jpeg\" alt=\"A diploma for Pegasus California School graduates\"\/><figcaption>A copy of the Pegasus California School diploma shows that it was issued by the Val Verde Unified School District.<\/p>\n<p>Verde Unified School District via records request; Samantha Lee\/Business Insider<\/p>\n<\/figcaption><\/figure>\n<p>The Riverside office sued FCMAT in May 2024, alleging its investigation was shoddy. Court papers reveal that it also referred the matter to the US Attorney&#039;s Office for the Central District of California &quot;so that it, and other federal agencies, would investigate the Pegasus Diploma Program for potential criminal prosecution.&quot;<\/p>\n<p>As of May 2024, the investigation was active, with a county education official interviewed a month earlier, the suit says. Ciaran McEvoy, a spokesperson for the federal prosecutors&#039; office, declined to comment on whether it&#039;s still open.<\/p>\n<p>Alex Sponheim, a spokesperson for Val Verde, said that the district was never contacted by the Justice Department.<\/p>\n<p>In February 2025, a judge ordered that FCMAT&#039;s reports into Pegasus stay under wraps after the Riverside County Office of Education argued the &quot;surface-level investigation&quot; could &quot;negatively impact&quot; further investigations into potential misconduct.<\/p>\n<p>A month later, the office retained the Los Angeles-based law firm Larson LLP to examine the ties between Val Verde and Pegasus. That scathing audit found &quot;sufficient evidence&quot; of &quot;fraud, misappropriation of funds, or other illegal fiscal practices.&quot;<\/p>\n<p>Stephen Larson, a partner at Larson LLP and the author of the report, told Business Insider in a statement that the audit &quot;raises serious concerns about academic integrity, taxpayer fraud, and may even implicate national security.&quot;<\/p>\n<p>&quot;We found that a California public school district improperly issued diplomas to students in China,&quot; Larson said, adding that &quot;the broader record shows those California credentials may have been used to create false legitimacy for students seeking entry into American universities.&quot;<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/i.insider.com\/69c2f1df58b5806618e7df6f?format=jpeg\" alt=\"Flags outside the Pegasus California School\"\/><figcaption>The state flag of California flew outside of Pegasus.<\/p>\n<p>Yan Cong for Business Insider<\/p>\n<\/figcaption><\/figure>\n<p>The diploma program was halted, but Pegasus remains open and, according to its website, is accredited by the nonprofit organization Cognia.<\/p>\n<p>The audit said the Western Association of Schools and Colleges wouldn&#039;t accredit Pegasus because it didn&#039;t meet its standards. Pegasus states on its site that it was founded &quot;with the blessing and support of the California Department of Education.&quot;<\/p>\n<p>Cognia did not immediately respond to a request for comment. The California Department of Education previously told Business Insider that it &quot;will not stand for any misuse of public funds and supports any investigation into this matter. California diplomas are for California students.&quot;<\/p>\n<p>A spokesperson for the Riverside County District Attorney&#039;s Office told Business Insider that it couldn&#039;t comment on possible investigative matters. A spokesperson for the State Controller&#039;s office, which oversees fiscal matters for the state, confirmed that their office had received a copy of the audit report and is reviewing it to determine appropriate actions.<\/p>\n<p><em>Do you have a tip? Contact this reporter via email at <\/em><em>neinbinder@businessinsider.com<\/em><em> or Signal at neinbinder.70. Use a personal email address, a nonwork device, and nonwork WiFi; <\/em><a href=\"https:\/\/www.businessinsider.com\/secure-news-tips\" rel=\"noreferrer\" target=\"_blank\"><em>here&#039;s our guide to sharing information securely<\/em><\/a><em>.<\/em><\/p>\n<p>Read the original article on Business Insider<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Val Verde school district had an unusual arrangement with a school in China. Christopher Vu for Business Insider Business Insider investigated ties between a California district, a school in China, and education officials. The county education department referred the matter to federal prosecutors. Now, a scathing audit ordered by the county has also been [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[],"class_list":{"0":"post-48214","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-usa"},"_links":{"self":[{"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/posts\/48214","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/comments?post=48214"}],"version-history":[{"count":0,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/posts\/48214\/revisions"}],"wp:attachment":[{"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/media?parent=48214"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/categories?post=48214"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/tags?post=48214"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}