A state grand jury returned another fraud indictment related to the Empowerment Scholarship Account program Monday based on allegations two non-Arizona residents siphoned $110,000 from the program by using falsified documents to create 50 accounts for real and fictitious children. 

The latest indictment is the third associated with ESA in the past two years, bringing renewed scrutiny and more calls for further legislative oversight. But Superintendent Tom Horne said the Department of Education had installed internal safeguards under his tenure, which he said assisted in flagging the most recent case. 

“I’m the former attorney general,” Horne said. “I have zero tolerance for fraud.” 

According to an indictment issued Nov. 12, Johnny Lee Bowers and Ashley Meredith Hewitt allegedly used false birth certificates, utility bills and lease agreements to create ESA accounts for 43 fictitious and seven real children under both their own names and “ghost parents” from December 2022 to May 2024. 

The two allegedly stole more than $110,000 and used the funds to pay for living expenses in Colorado. Bowers and Hewitt are now believed to reside in Utah, according to the Attorney General. 

The grand jury returned 60 charges, with one count of conspiracy and one count of fraudulent schemes and artifices of  $100,000 or more, both class two felonies, which carry a punishment of four to 10 years in prison, and 58 counts of forgery, all class four felonies that carry a potential punishment of 1.5 to three years in prison each. 

According to Horne and a spokesperson for the Attorney General’s office, the Arizona Department of Education flagged and submitted the matter for further investigation. 

Attorney General Kris Mayes’ office is prosecuting two other cases related to ESA fraud. 

One indictment, issued in February, alleges three former employees of the ESA program and two adult children of one employee defrauded the program of more than $600,000 by using falsified birth certificates and disability diagnoses to enroll five adults, seven real children and five “ghost children.”

The case is set for a trial setting conference on Dec. 9, though the state ran into some witness issues after the judge granted a motion from the defense to preclude ESA Director John Ward, former ESA Compliance Officer Shannon Nelson and any ESA employee from testiyfing given the state’s failure to timely disclose witnesses. 

The other fraud indictment deals with three women who allegedly set up shell education vendors to procure about $87,900 from the program.

Defendant Sarah Ishler entered a plea agreement with the state in May, and defendant Angela Turner agreed to plead guilty to a lesser charge. One remaining defendant, Michelle Dils, is due for a status conference and possible change of plea on Dec. 17, but as of the last conference on Nov. 21, her attorney and the state had yet to reach an agreement. 

Horne credited the department for flagging two of the three pending cases, with the exception of alleged fraud by the former ESA employees. He said he had put in additional “safeguards” during his time in office, including hiring Ward, who formerly worked as an auditor with the Auditor General’s Office, and Shannon Nelson, as an investigator and compliance officer. 

Department spokesman Doug Nick, noted, though, Nelson has since left and now serves as deputy director for the Arizona Department of Gaming. 

Horne added, following the indictment of ESA employees in February, the department had ceased a policy allowing department employees latitude to select which student accounts and submissions to oversee and had since implemented training on identifying falsified documents. 

According to Nick, the Arizona Office of Vital Records and the Western Region U.S. Bureau of Consular Affairs held sessions in April, June and July of this year and the department plans to hold further trainings in the future. 

As for vetting ESA applications generally, Nick said, “It’s a robust process designed to deter fraud and to ensure all prospective account holders are legitimate and can prove identity through birth certificates and Social Security numbers … when somebody does try to sneak through the system with something inappropriate, it’s readily evident.” 

But the latest indictment did not inspire confidence, bringing on additional calls for legislative fixes.

“Arizona’s ESA voucher program is wide open for fraud and abuse— and the Republican majority in the Arizona Legislature has refused to add any oversight or accountability,” Beth Lewis, executive director of Save Our Schools, a public school advocacy group, said in a prepared statement. “Misuse and outright fraud will continue to abound until lawmakers add serious guardrails to this off-the-rails entitlement program.”