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Special education provider pleads guilty to felony charges

ALBANY - The executive director of special education provider IncludED Educational Services pleaded guilty in Manhattan Supreme Court today to grand larceny charges stemming from an audit and investigation by State Comptroller Thomas DiNapoli. Morton Kramer agreed to pay $418,000 in restitution as part of his plea agreement and is banned for life from providing special education services for the state.

"Today’s guilty plea shows that those who rip off taxpayers and students will not get away with it," DiNapoli said. "I would like to thank Manhattan District Attorney Cyrus Vance for prosecuting this case and bringing this wrongdoer to justice. Waste, fraud and abuse that shortchange children from getting critical services cannot be tolerated in our special education. My office will continue to do everything it can to root it out."

Kramer admitted that the defunct IncludEd, based in Cedarhurst, Nassau County, inappropriately charged New York City’s Department of Education (DoE) and other school districts for salaries paid to his sons and other relatives as discovered in an in-depth review by DiNapoli’s auditors and investigators.

Kramer agreed to repay $418,000 paid to six of his relatives who performed little or no work for the special education programs over a three-year period.

IncludED provided special education services to children between the ages of three and five. The DoE and other school districts paid tuition to IncludED using rates set by the State Education Department (SED). These rates are based on costs from financial reports that special education providers, such as IncludED, submit to SED. The costs included on the reports must fully comply with the guidelines in SED’s Reimbursable Cost Manual.

As part of his plea agreement, Kramer will serve five years on probation and will have to divest his ownership of IncludEd.

DiNapoli’s audits and investigations of the special education sector have so far resulted in ten felony arrests and five guilty pleas with more than $3 million in ordered restitution. DiNapoli’s office is currently working with various prosecutors on other criminal referrals stemming from audits of special education providers.

For a copy of the original audit, visit: www.osc.state.ny.us/audits/allaudits/093012/10s59.pdf