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December 18, 2013

Nonprofit Pearson pays $7.7 million in Common Core settlement

Pearson Charitable Foundation, the nonprofit arm of educational publishing giant Pearson Inc., has agreed to pay a $7.7 million settlement to New York Attorney General Eric T. Schneiderman after he determined that the foundation had created Common Core products to generate “tens of millions of dollars” for its corporate sister.

“The law on this is clear: non-profit foundations cannot misuse charitable assets to benefit their affiliated for-profit corporations,” Schneiderman said in a statement Thursday. T

he investigation by the attorney general examined Pearson’s efforts since 2010 to develop a line of classroom materials and tests built around the Common Core, new K-12 academic standards in reading and math that have been fully adopted by 45 states and the District of Columbia.

Pearson, the largest educational publisher in the world, sells instructional content, tests, systems and technology for profit to states, school districts and individual schools in the United States and across the globe. The adoption of the Common Core has created a lucrative opportunity for educational publishers, as states and schools rush to buy products “aligned” to the new standards.

According to the settlement, Pearson used its nonprofit foundation to develop Common Core products in order to win an endorsement from a “prominent foundation.”

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