Milwaukee Public Schools Loses 0,000 in Bank Impersonation Fraud Scheme

Milwaukee Public Schools Loses $450,000 in Bank Impersonation Fraud Scheme

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Milwaukee Public Schools Hit by $450,000 Bank Fraud Amid $58 Million Deficit Crisis

Milwaukee Public Schools learned on November 2 that an external party had siphoned $450,000 from its US Bank accounts through a sophisticated bank impersonation scheme, Wisconsin Public Radio reported, a theft that comes as the district grapples with a ballooning $58 million budget shortfall and reserves that have dwindled to just $500,000.

The fraud represents the latest blow to a district already under intense scrutiny. MPS officials announced Tuesday that $255,000 of the stolen funds have been recovered by US Bank, with efforts underway to trace the remaining $195,000. The district has notified the FBI, the Wisconsin Statewide Intelligence Center, the Milwaukee Police Department, and its own Office of Accountability and Efficiency, WTMJ reported.

A CFO Change in the Midst of the Storm

During the investigation, Deputy Chief Financial Officer Jennifer Buros will serve as acting CFO, replacing Aycha Sawa, who had held the post since September 2024 but remains employed by the district. TMJ4 reported that Buros, who joined MPS in July after three years at the Wisconsin Department of Public Instruction overseeing school finance reporting and district auditing, will be assisted by Charles Burbridge of the Council of the Great City Schools.

Superintendent Brenda Cassellius, who has led the district since March 2025, called the incident a “sobering reminder of the sophisticated financial scams that occur every day across the country,” according to TMJ4. “We are taking swift and immediate action to strengthen our internal procedures to prevent this from happening,” she said. “We also are working with our partners at US Bank to recover the remainder of the funds.”

The district is not alone in falling prey to these schemes. In February, Dickinson Public Schools in Oklahoma worked with the FBI to recover nearly $5 million after a similar bank impersonation incident, Wisconsin Public Radio noted. Data released by BioCatch in August found that 292 financial institutions serving a combined more than 280 million users had reported attempted impersonation scams—more than double the number from earlier in the year.

Nearly $450K stolen from Milwaukee Public Schools in bank impersonation fraud

“Obviously we fell victim to that,” Cassellius said Wednesday. “It just points out the real seriousness of how sophisticated these actors are in the impersonation.”

The Deeper Financial Hole

The $450,000 loss lands as MPS faces structural financial challenges that dwarf the fraud. The district’s overall budget deficit has grown to approximately $58 million, up from the $46 million gap officials closed with cuts in February, Wisconsin Public Radio reported. The Board of School Directors updated the final 2026-27 budget at the end of October, raising projected expenses from $1.6 billion to $1.77 billion.

Enrollment declines are driving much of the shortfall. The district projected 60,277 students this year but enrolled only 58,088, and since state funding follows students, the drop translates directly into lost revenue. Transportation costs have risen amid soaring fuel prices, while inflation has driven up spending on food, Cassellius explained.

“We just continue to tighten our belts,” Cassellius told Wisconsin Public Radio. “And we continue to look at places where we can create greater efficiencies. Part of that is closing schools, although that doesn’t provide as much relief as I think people think it does.”

milwaukee public schools
Photo: tmj4.com

Reserves Nearly Gone

The district’s financial cushion has all but evaporated. Cassellius warned school board members that the reserve fund stands at just $500,000, far below the roughly 5 percent of budget—about $88.5 million—that represents common practice nationwide for school districts, WPR reported.

Building that reserve back up presents a paradox: Wisconsin’s school funding formula is based on district spending, enrollment, and property values, meaning that saving money could actually reduce future aid. Cassellius has pinned hopes on the newly elected Democratic leadership in Madison.

Milwaukee Public Schools loses $450,000 in bank impersonation fraud

MPS Tightens Financial Oversight

The fraud investigation continues with federal and state partners, while MPS implements “short-term and long-term controls” to protect its finances, officials said.

Cassellius took the helm in March 2025 after former Superintendent Keith Posley resigned in June 2024 amid revelations of mismanagement and financial failures that sparked outrage among residents. With a new acting CFO in place and law enforcement hunting the remaining $195,000, the district now waits to see whether political change in Madison can translate into the funding relief Milwaukee’s students need.

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