Oklahoma AG Dismisses Lawsuit Against ClassWallet, Wants Accountability For Misused Education Money

The Oklahoma Attorney General said an online vendor is being wrongfully blamed for millions of misused taxpayer money. 

That is why Oklahoma Attorney General Gentner Drummond said he’s dropping the lawsuit against ClassWallet.  

Federal investigators are still figuring out what happened to money meant for families’ education. 

Last year, the U.S. Department of Education’s Office of Inspector General released a report showing those funds were spent on everything from home appliances to Christmas trees.  

“It is one of those subject matters that we’ve investigated over the last three weeks,” Drummond said. “The lawsuit really lacks merit to proceed to waste further state resources.”  

Last year, federal investigators found questionable expenditures and processes surrounding $31 million in Governor’s Education Emergency Relief funds.    

“We have $31 million we have to account for back to the federal government,” Drummond said. 

Drummond’s predecessor John O’Connor filed the suit last August, blaming the online vendor ClassWallet for the misused relief funds. 

Oklahoma contracted with the Florida-based software company to allow families to purchase education supplies with federal relief money.   

“Those dollars could have been used to help the intended recipients,” Drummond said. 

Last May, an Oklahoma Watch and The Fontier investigation found Oklahoma awarded ClassWallet with a “no bid state contract to distribute $8 million to families with little government oversight.” 

Their investigation found some families used the “Governor’s Emergency Education Relief Funds to buy Christmas trees and gaming consoles,” among several other things not considered to be educational. 

“Classwallet is simply a portal,” Drummond said. 

A ClassWallet spokesperson said “ClassWallet is gratified that Oklahoma Attorney General Gentner Drummond decided to dismiss the State’s lawsuit against the company. 

“Since its founding in 2014, ClassWallet has dedicated itself to providing school districts and state agencies with its trusted digital wallet technology platform, designed to help leaders deliver on the promise of education.” 

Drummond said he’s dismissing the lawsuit against ClassWallet to focus on "a clear number of state actors and other individuals."  

“We had over 600 families that had qualified under the poverty line that had applications pending – that were not met. that is egregious,” Drummond said. 

Drummond said Oklahoma will likely write a substantial check to the federal government for what's already spent. How much -- is yet to be determined.