Democracy Builders Fund

Activity

While the organization was incorporated in 2014, it has allegedly been operating since 2005. ^{3 4}

Democracy Builders Fund founded Degrees of Freedom, a nonprofit which helps students enrolled at accredited institutions manage their expenses and provides them with professional training. ⁵ Degrees of Freedom remains a fiscally sponsored project of Democracy Builders. ⁶

Other programs and organizations it has sponsored and financed include Washington Leadership Academy, Alumni Revolution, the Arena Summit, VoteAmerica, Civics Nation, Blackstone Valley Prep, Virtual Reality in Education, Liberal Education & Achievement Resource Network (LEARN), the Global Fund for Emerging Scholars, and others. ³

Controversies

VoteAmerica

Democracy Builders Fund received a $312,107 loan in March 2020 from the Paycheck Protection Program and then received a second loan for nearly a $1 million in May 2020. However, journalists discovered that the group had less than $400,000 in expenses during the 2018 fiscal year. The loan received in May was sent to an address that voter mobilization group VoteAmerica went on to use to incorporate itself. ⁷

Debra Cleaver, the founder of VoteAmerica, has explicitly said that Democracy Builders fiscally sponsored her organization before it attained its own tax-exempt status. For a time, VoteAmerica’s roughly 20 employees received their paychecks from Democracy Builders. ⁸

Seth Andrew Arrest

In April 2021, Seth Andrew was arrested on charges of wire fraud, money laundering, and making false statements to a financial institution after he allegedly stole $218,005 from Democracy Prep Public Schools, the charter school network that he founded. ^{9 10}

He reportedly used the money to obtain a lower rate on a mortgage for a Manhattan apartment for him and his wife, CBS News anchor Lana Zak. According to Bloomberg News, Andrew stole the funds in 2019 from the charter schools’ escrow accounts. ¹⁰ According to a Democracy Prep board member, Andrew refused to fund the schools with anything other than government money, meaning the money he stole was technically taxpayer money. ¹¹ Andrew was ordered to remain in Vermont, where he had lived before purchasing the Manhattan apartment. ¹¹

By May 2021, Andrew was free on a $500,000 bond and the defense counsel was discussing a potential disposition to the case with the government. ¹² On January 14, 2022, the Justice Department announced that Andrew had pleaded guilty to one count of wire fraud. ¹³