Oklahoma Gov. Announces Lawsuit In Case Of Misused Federal COVID Funds, State Auditor Continues Investigation

Oklahoma Governor Kevin Stitt announced on Tuesday the state had filed a lawsuit against a vendor the state partnered with to roll out relief dollars to families in need during the COVID-19 pandemic.

“A vendor, which said it would eliminate the possibility of fraudulent use of grant funds, didn’t uphold its end of the contract, and taxpayer dollars were misused," Stitt said in a news release.

The dollars in question came from the Governor's Emergency Education Relief Fund, which was meant to help students of "predominately low and moderate means," according to the suit filed in Oklahoma County District Court. The state received nearly $39 million in total GEER allocations.

In an annual federal audit, State Auditor Cindy Byrd labeled $8 million of the spent dollars as 'questionable'. Some of the expenses questioned include families who used the money to buy Christmas trees, household appliances, power tools, or furniture; among other things.

ClassWallet, the vendor that Oklahoma contracted with to distribute the funds, previously told News 9 it had not deviated from its standard of service. "We are proud of our track record as the country’s leading provider of purchasing and reimbursement software for public funds," the company said in a statement in July. "Hundreds of school district and state government administrators across the country use ClassWallet’s digital wallet technology to run impactful programs totaling over $2.7 billion and impacting over six million students."

On Wednesday, ClassWallet responded to the lawsuit, "The Oklahoma Attorney General and federal government officials have previously confirmed that, as a software provider, ClassWallet had neither responsibility for, nor authority, to exercise any decision-making with respect to the Oklahoma programs," a company spokesperson said in a statement.

After taking office, Attorney General Gentner Drummond dismissed another lawsuit against ClassWallet filed by his predecessor. "ClassWallet did exactly what we told them to do, and that is to open the portal," Drummond said.

A GEER funds-specific investigation audit from the State Auditor's office, requested by Drummond's office, is ongoing.