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The federal investigation into the Los Angeles Unified School District superintendent, whose home and school office were raided Wednesday, may be tied to a failed multimillion-dollar AI school contract involving a potential conflict of interest.
Alberto Carvalho previously awarded a $6 million contract, paying $3 million up front, to education technology company AllHere.
A former salesperson employed by the firm also had her Miami property raided the same day as Carvalho, according to public records cited by the Los Angeles Times. The woman, Debra Kerr, reportedly had close ties to Carvalho during his tenure leading Miami-Dade County Public Schools.
Spokesperson Jim Marshall confirmed to local media Miami Herald that “we searched a residence in Southwest Ranches today as part of this matter and have since cleared the scene.”
In 2023, Carvalho secured a contract with AllHere to develop an AI chatbot called “Ed,” designed to help address student issues such as absenteeism.
It ultimately collapsed in 2024 after its founder, Joanna Smith-Griffi, was accused of embezzling funds amid data privacy risks and whistleblower concerns. She was later charged with securities fraud, wire fraud and identity theft.
Kerr further claimed in AllHere’s bankruptcy court filings that the company owed her commissions for helping secure its deal with LAUSD, according to education-focused outlet The 74.
While federal officials confirmed that search warrants were conducted Wednesday, they declined to reveal the nature of the investigation, noting that the warrants remain under seal.
However, sources told the LA Times that the investigation fell under the broad category of financial issues, and that the raid focused on Carvalho rather than the California school district.
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LAUSD released a statement saying the district is fully cooperating with federal officials.
“The LAUSD Board of Education understands that today’s news has raised questions across our school communities,” it said.
“The Board’s priority remains ensuring that our students, families, and employees experience a safe and welcoming learning environment. Teaching and learning continue across our schools. Los Angeles Unified continues to stay focused on our responsibility to serve students and our families.”
The superintendent has led the nation’s second-largest school district since 2022, overseeing the education of roughly 400,000 students. He was also unanimously reappointed to the position in September 2025.
Before moving to California, he spent 14 years leading Miami‑Dade County Public Schools, the nation’s fourth-largest school district.
Wednesday’s raids mark the latest controversy to engulf Carvalho.
In 2020, he helped secure a $1.57 million donation from a company that had a pending contract with the district, the Miami Herald reported.
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The funds reportedly went to an education nonprofit he founded, and the company’s online learning program, which was ultimately plagued with problems, was quickly scrapped.
In June 2021, the school’s inspector general determined that the donation, intended to benefit teachers, did not violate any policies but created the “appearance of impropriety,” the outlet said. The foundation was subsequently urged to return the funds, which reportedly had been distributed to teachers as $100 gift certificates.
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