#### In re: Edward DUDLEY, Sr., Debtor. Mike DeWine, Ohio Attorney General, Plaintiff, v. Edward Dudley, Sr., Defendant.

Case No. 15-54258

Adv. Pro. No. 15-02199

United States Bankruptcy Court, S.D. Ohio, Eastern Division, Eastern Division.

Signed August 17, 2017

*712Victoria D. Garry, Cincinnati, OH, for Plaintiff.

Edmund F. Brown, FisherBroyles LLP, Columbus, OH, Patricia B. Fugee, Fisher-Broyles, Perrysburg, OH, for Defendant.

MEMORANDUM OPINION GRANTING IN PART AND DENYING IN PART DEFENDANT’S MOTION FOR SUMMARY JUDGMENT AND DENYING PLAINTIFF’S MOTION FOR PARTIAL SUMMARY JUDGMENT (Docs. 26 and 33)

C. Kathryn Preston, United States Bankruptcy Judge

This adversary proceeding is before the Court for consideration of cross-motions for summary judgment and related documents filed in support: *Defendant’s Motion for Summary Judgment*(Doc. 26) (“Dudley’s MSJ”); Plaintiffs *Motion for Partial Summary Judgment*(Doc. 331) (“AG’s MSJ”); and *Defendant’s Memorandum in Opposition to Plaintiff’s Motion for Partial Summary Judgment and Reply in Support of Defendant’s Motion for Summary Judgment*(Doc. 42) (“Dudley’s Memorandum”); and Plaintiffs *Reply in Support of the State’s Motion for Partial Summary Judgment*(Doc. 45)(“AG’s Reply”). The defendant in this adversary proceeding, Edward Dudley, Sr. (“Dudley”), was a designated financial officer at several community schools and is the debtor in the underlying Chapter 7 bankruptcy case. The plaintiff, the Attorney General of the State of Ohio (the “AG”), is seeking a determination that Dudley’s liability resulting from certain Findings for Recovery issued by the state auditor is excepted from discharge under 11 U.S.C. § 523(a)(8)(A)(ii). Dudley’s MSJ seeks the opposite determination: that whatever liability he may have to the State of Ohio is not excepted from discharge under either 11 U.S.C. § 523(a)(8)(A)(ii) or (a)(4), and that his discharge should not be denied under 11 U.S.C. § 727(a)(3), as a matter of law. Neither party is seeking summary judgment as to the underlying liability itself, which has not been definitively established.2 The Court, having considered the record and the arguments of the parties, issues the following opinion.

I. Jurisdiction

The Court has jurisdiction over this matter pursuant to 28 U.S.C, § 1334 and Amended General Order 05-02 entered by the United States District Court for the *713Southern District of Ohio, referring all bankruptcy matters to this Court. This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(I) and (J). Venue is properly before this Court pursuant to 28 U.S.C. §§ 1408 and 1409.

II. Standard of Review for Motions for Summary Judgment

Rule 56 of the Federal Rules of Civil Procedure, made applicable to adversary proceedings by Federal Rule of Bankruptcy Procedure 7056, provides that the Court “shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). A party seeking summary judgment must illustrate that the facts are not genuinely disputed by pointing to “particular parts of materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations ..., admissions, interrogatory answers, or other materials!)]” Fed. R. Civ. P. 56(c)(1)(A). The party seeking summary judgment bears the initial burden of “informing the ... court of the basis for its motion, and identifying those portions of the [record] which it believes demonstrate the absence of a genuine issue of material fact.” *Celotex Corp. v. Catrett,*477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); *see also*Fed. R. Civ. P. 56(c)(3).

If the movant satisfies this burden, the nonmoving party may not rest on its pleading, but similarly must, by citation to particular parts of the record, demonstrate that a fact or facts are subject to dispute. Fed. R. Civ. P. 56(c)(1). The mere allegation of a factual dispute is not sufficient to defeat a motion for summary judgment; to prevail, the non-moving party must show that there exists some genuine issue of material fact. *See Anderson v. Liberty Lobby, Inc.,*477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). “The Judge’s function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.” *Hirsch v. CSX Transp., Inc.,*656 F.3d 359, 362 (6th Cir. 2011) (quoting *Anderson,*477 U.S. at 249, 106 S.Ct. 2505), “When determining whether the evidence is sufficient, the trial court should not weigh the evidence, evaluate the credibility of witnesses, or substitute its judgment for that of the jury.” *J.C. Wyckoff & Assocs., Inc. v. Standard Fire Ins. Co.,*936 F.2d 1474, 1487 n.19 (6th Cir. 1991) (citation omitted). Rather, the court must deem as true the nonmovant’s evidence and must view all justifiable inferences in a light most favorable to the non-moving party. *Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,*475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); *Anderson,*477 U.S. at 255, 106 S.Ct. 2505.

The Sixth Circuit Court of Appeals has articulated the following standard to apply when evaluating a motion for summary judgment:

> [T]he moving [party] may discharge its burden by “pointing out to the ... court ... that there is an absence of evidence to support the nonmoving party’s case.” The nonmoving party cannot rest on its pleadings, but must identify specific facts supported by affidavits, or by depositions, answers to interrogatories, and admissions on file that show there is a genuine issue for trial. Although we must draw all inferences in favor of the nonmoving party, it must present significant and probative evidence in support of its [position], “The mere existence of a scintilla of evidence in support of the [nonmoving party’s] position will be insufficient; there must be evidence on which the jury could reasonably find for the [nonmoving party].” -

*714*Hall v. Tollett,*128 F.3d 418, 422 (6th Cir. 1997) (internal citations omitted).

A material fact is one whose resolution will affect the determination of the underlying action. *Tenn. Dep’t of Mental Health & Mental Retardation v. Paul B.,*88 F.3d 1466, 1472 (6th Cir. 1996) (citing *Anderson,*477 U.S. at 248, 106 S.Ct. 2505). An issue is genuine if a rational trier of fact could find in favor of either party on the issue. *Schaffer v. A.O. Smith Harvestore Prods., Inc.,*74 F.3d 722, 727 (6th Cir. 1996) (citation omitted).3 “The substantive law determines which facts are ‘material’ for summary judgment purposes.” *Hanover Ins. Co. v. American Eng’g Co.,*33 F.3d 727, 730 (6th Cir. 1994) (citations omitted). However, determinations of credibility, weight to be given the evidence, and inferences to be drawn from the facts remain the province of the jury. *Anderson,*477 U.S. at 255, 106 S.Ct. 2505.

In determining whether each party has met its burden, the court must keep in mind that “[o]ne of the principal purposes of the summary judgment rule is to isolate and dispose of factually unsupported claims or defenses.” *Celotex, 477*U.S. at 323-24, 106 S.Ct. 2548. If otherwise appropriate, summary judgment may also be entered for a nonmoving party. *K.E. Resources, LTD. v. BMO Fin. Inc. (In re Century Offshore Mgmt. Corp.),*119 F.3d 409, 412 (6th Cir. 1997); *see also Celotex,*477 U.S. at 326, 106 S.Ct. 2548 (“[District courts are widely acknowledged to possess the power to enter summary judgments *sua sponte,*so long as the losing party was on notice that she had to come forward with all of her evidence.”); *see also*Fed. R Civ. P. 56(f).

III. Factual Background

Chapter 3314 of the Ohio Revised Code governs the creation and operation of community schools4 in Ohio. These community schools are public schools and are publicly funded. They receive funds both from the school districts where the community school’s students reside and from state and federal grants made by or passing through the Ohio Department of Education.

Each school is required to have a designated fiscal officer (“DFO”). Ohio Rev. Code § 3314.011(A). This person performs the same function as the treasurer of a traditional school district and is often referred to as the school’s treasurer.

Dudley received a school treasurer’s license in 2008. From 2008 through 2012, Dudley served as DFO to various community schools located throughout Ohio. It was not uncommon for individuals to act as DFO for multiple community schools simultaneously, as Dudley did. As DFO, Dudley had access to the schools’ funds and accounts, prepared and signed checks, and produced various reports for the schools’ governing boards, the schools’ sponsors, the Ohio Department of Education, and external auditors.

Community schools are subject to audits by the Auditor of State (the “Auditor”). The Auditor reviews the schools’ financial statements and general financial status, as well as assesses internal controls and the schools’ compliance with relevant laws, regulations, and other requirements. The *715Auditor produces an audit report that details the results of the audit and identifies any problems discovered. If the audit reveals that funds were expended in violation of law, the audit report includes findings for recovery (“FFR”). An FFR states the law at issue, summarizes the facts relevant to the violation, sets forth the amount of money involved, and identifies those individuals or entities that the Auditor has concluded are liable, individually or jointly, for the repayment of the funds.5

Audits of some of the community schools6 for which Dudley acted as DFO resulted in audit reports containing FFRs. The grounds for most of these FFRs fall into three main categories: (1) transactions that were insufficiently documented, (2) transfers of public funds pursuant to contracts that violated Ohio Rev. Code § 2921.42(A)7, and (3) payments of illegal bonuses and stipends. While not all of those FFRs determined that Dudley was liable for the violations detailed therein, a substantial number named Dudley liable for repayment of funds.

It is Dudley’s liability for certain FFRs that is central to this adversary proceed*716ing. The AG’s *Complaint for Money Judgment, Objecting to Discharge, and To Determine the Dischargeability of Debts*(Doc. 1) (“Complaint”), filed October 6, 2015, set forth multiple causes of action against Dudley: (1) for liability of a public official for public money related to the FFRs, monetary judgment in the amount of $1,333,823.50 plus interest; (2) for breach of fiduciary duty, monetary judgment in the amount of $1,367,631.71 plus interest and disgorgement of compensation in an unspecified amount; (3) denial of discharge pursuant to 11 U.S.C. 727(a)(3); (4) determination that Dudley’s liability to the State of Ohio is excepted from discharge under 11 U.S.C. § 523(a)(4); and (5) determination that Dudley’s liability to the State of Ohio is excepted from discharge under 11 U.S.C. § 523(a)(A)(8)(ii).8

The precise amount of Dudley’s liability to the State of Ohio is not before the Court at this time, as neither party has requested such a determination. So it is not necessary to detail here the multiple audit reports and numerous FFRs attached as an appendix to the AG’s Complaint.

IV. Denial of Discharge under 11 U.S.C. § 727(a)(3)

In the Complaint, the AG objects to Dudley’s discharge pursuant to § 727(a)(3) of the Bankruptcy Code. Dudley’s MSJ asks the Court to enter judgment in his favor on this count of the Complaint. Section 727 provides, in relevant part, as follows:

> (a) The Court shall grant the debtor a discharge, unless—

> 3⁄8 3⁄8 $

> (3) the debtor has concealed, destroyed, mutilated, falsified, or failed to keep or preserve any recorded information, including books, documents; records, and papers, from which the debtor’s financial condition or business transactions might be ascertained, unless such act or failure to act was justified under all of the circumstances of the case[.]

11 U.S.C. § 727(a)(3).

This section, “requires the debtor to provide creditors ‘with enough information to ascertain the debtor’s financial condition and track his financial dealings with substantial completeness and accuracy for a reasonable period past to present.’ ” *Turoczy Bonding Co. v. Strbac (In re Strbac),*235 B.R. 880, 882 (6th Cir. BAP 1999) (quoting *In re Martin,*141 B.R. 986, 995 (Bankr. N.D. Ill. 1992)). “The purpose of this section [is] to protect the creditor’s interest by placing on the debtor the responsibility to take such steps as ordinary fair dealing requires to allow the creditors the opportunity to learn what was done with the debtor’s estate.” *Spilker v. Boggs (In re Boggs),*145 B.R. 13, 14 (Bankr. N.D. Ohio 1992). “The provision ensures that trustees and creditors will receive sufficient information to enable them to ‘trace the debtor’s financial history; to ascertain the debtor’s financial condition; and to reconstruct the debtor’s financial transactions.’ ” *In the Matter of Juzwiak,*89 F.3d 424, 427-28 (7th Cir. 1996) (quoting *Martin,*141 B.R. at 995).

The sufficiency of the debtor’s records is evaluated on a case by case basis and what is reasonable under the circumstances. *Strbac,*at 882. When assessing the adequacy of the debtor’s records, courts should consider “the debtor’s occupation, financial structure, education, experience, sophistication, and any other *717circumstances that should be considered in the interest of justice.” *Id.*(quoting *United States v. Trogdon (In re Trogdon),*111 B.R. 655, 658 (Bankr. N.D. Ohio 1990).

“The elements of a violation of 11 U.S.C. § 727 must be proven by a preponderance of the evidence to merit a denial of discharge.” *Keeney v. Smith (In re Keeney),*227 F.3d 679, 683 (6th Cir. 2000). The party objecting to discharge has the initial burden of proving that debtor’s records are not adequate to ascertain the debtor’s financial condition. *Strbac,*at 882; *see also*Fed. R. Bankr. P. 4005 (“At the trial on a complaint objecting to a discharge, the plaintiff has the burden of proving the objection.”). To satisfy this burden, the objecting party must accomplish .the following:

> (1) offer evidence of the general nature of Defendant’s business or personal financial position and the types of transactions about which recorded information is sought, (2) present evidence identifying the recorded information he alleges has been concealed, destroyed, mutilated, falsified or not kept or preserved by Defendant, and (3) show how the missing recorded information “might” enable Defendant’s actual financial condition or business transactions to be ascertained under the circumstances of the case.

*McDermott v. Neff (In re Neff),*2015 WL 9488240, *2, 2015 Bankr. LEXIS 4361, *5 (Bankr. N.D. Ohio Dec. 28, 2015) (citing *Strzesynski v. Devaul (In re Devaul),*318 B.R. 824, 829 (Bankr. N.D. Ohio 2004)). However, once the inadequacy of the records has been established, the burden shifts to the debtor to show that the failure to maintain adequate records was'justified under the circumstances. *Strbac,*at 883.

In this case, the AG asserts that Dudley, when acting as the DFO of various community schools, failed to properly document numerous school transactions as required by law. These transactions are set forth in the various FFRs in the audit reports attached as an appendix to the Complaint. One example of such an FFR is Finding No. 2010-019 from the audit of the Carter G. Woodson Institute for fiscal year 2010. A check for $430 had been issued and signed by Dudley as treasurer for the school. The FFR stated as follows:

> There was no documentation indicating the Board approved this expenditure or that it was otherwise for a proper public purpose. Without proper supporting documentation, it is not possible to determine if the expenditure was for goods .or services that would be considered a proper public purpose. The failure to maintain adequate support for expenditures could result in a loss of accountability over the Institute’s finances, making it difficult to identify errors which could go undetected, and possibly result in expenditures that are not for a proper public purpose.

Complaint, Appx. 35. The Auditor issued the FFR against both the recipient of the check and Dudley, jointly and severally, in the amount of $430.

The AG asserts that numerous transactions set forth in the FFRs, substantially similar to the undocumented purchase by check described in FFR 2010-019 above, constitute “business transactions” as that term is used in § 727(a)(3). Further, the AG asserts that Dudley has failed to keep or preserve recorded information from which the legitimacy of those transactions can be ascertained, and that his failure to keep those records has resulted in personal liability to Dudley himself, which impacts Dudley’s financial condition. Therefore, according to the AG, Dudley has failed to keep or preserve recorded information from which his financial condition can be accurately ascertained, and should *718be denied discharge under § 727(a)(3). In Dudley’s MSJ, Dudley argues that “the records at issue are the records of the charter schools, not any records pertaining to any transactions in which [Dudley] engaged personally” and that this claim fails as a matter of law. Motion, 5. This Court agrees.

As an initial matter, the Court concludes that the AG has satisfied the first two of the three requirements set forth in *Devaul*to show that Dudley’s records are not adequate to ascertain his financial condition. The record contains substantial evidence of Dudley’s activities as DFO of various community schools, and the FFRs present sufficient evidence — very precise and detailed evidence — identifying the records that were not kept or preserved by Dudley. The AG can be successful on his claim under § 727(a)(3) only if he can satisfy the third requirement as well; that is, he must show how the missing documents might enable Dudley’s actual financial condition or business transactions to be ascertained under the circumstances of the case.

Note that the AG does not claim, in his Complaint or elsewhere, that Dudley concealed, destroyed, mutilated, falsified, or failed to keep or preserve any of his own records or documentation directly related to his own personal finances. There are no allegations regarding Dudley’s personal tax returns, his private bank account records, investment account statements, incomplete or inaccurate bankruptcy schedules or forms, or any other records documenting his income, his expenses, or his personal assets. The only records at issue here are those that the FFRs state were not provided to document transactions involving community school funds while Dudley was DFO.

This missing documentation, however, is not of the type “from which the debtor’s financial condition or business transactions might be ascertained,” as required by § 727(a)(3). The missing records in this case are supporting documents the should have been maintained to verify that the expenditure in question was both approved by that community school’s board and used for a proper public purpose. These records are associated with the financial transactions of the community schools themselves, transfers of funds from the school accounts to third parties. Dudley may have signed the checks or authorized the transfers, but the transactions in question were not transfers of his personal funds and did not have any direct effect on his financial condition.

The ÁG argues that the “duty to preserve includes records of the debtor’s transactions with *other persons’property*if those transactions impact his own finances.” AG’s MSJ, 19 (emphasis in original). As support for this proposition, the AG cites to *Office of the Comptroller Gen. of Republic of Bolivia on Behalf of Bolivian Air Force v. Tractman,*107 B.R. 24 (S.D.N.Y. 1989) (“[T]he statute itself makes clear that section 727(a)(3)’s complete disclosure requirement • extends beyond the property of the estate to include all ‘business transactions’ which shed light on the financial condition of the debtor.”).

*Tractman*involved a debtor who had converted $33.01 million of promissory notes that belonged to Bolivia. Bolivia objected to the debtor’s discharge under § 727(a)(3) because the debtor had failed to keep or preserve records regarding the unlawful transfer of the notes. The bankruptcy court overruled Bolivia’s objection, reasoning that because the promissory notes were not the property of the debtor, he had no duty to produce records explaining what he had done with them. On appeal, the district court held that § 727(a)(3) “makes complete disclosure a condition precedent to discharge and this *719disclosure requirement applies to all of the debtor’s business transactions from which his financial condition may be ascertained.” *Tractman,*107 B.R. at 25. The district court concluded that the bankruptcy court had erred in not considering the disclosure requirement, vacated the debtor’s discharge, and remanded the case to the bankruptcy court to determine what records had been produced and whether the debtor had satisfied the requirements of complete disclosure.

*Tractman*makes clear that a debtor may forfeit discharge for failure to disclose business transactions, but that disclosure requirement applies to transactions “from which the debtor’s financial condition may be ascertained!!]” *Id.*In *Tractman,*the records of the transfer of the promissory notes were important because they would provide additional insight into the debtor’s financial situation. “Clearly the transfer by the debtor of $33.01 million of promissory notes constitutes a financial transaction for which complete disclosure is required. Indeed, any money or property received by the ■debtor in exchange for the notes *might be property of the estate.” Id.*at 27 (emphasis added). The inquiry is whether the missing documents provide additional and necessary information into the financial affairs of the debtor, not of another, unrelated entity. *See Lewis v. Summers (In re Summers),*320 B.R. 630, 638 (Bankr. E.D. Mich. 2005) (“Section 727(a)(3) requires that the records relate to *the debt- or*concealing [or destroying, mutilating, falsifying, or failing to keep or preserve] information about *the debtor’s*financial condition.” (emphasis in original)).

When evaluating whether an objecting creditor has satisfied the third *Devaul*requirement, it is helpful to consider what additional information would be presented about the debtor’s financial affairs if the missing records sought by the creditor were to miraculously appear. *See Grange Mutual Ins. Co. v. Benningfield (In re Benningfield),*109 B.R. 291, 293 (Bankr. S.D. Ohio 1989) (“[T]he requirement in § 727(a)(3) that the Debtor keep or preserve records from which his financial condition might be ascertained includes, as a necessary included assumption, that any records which have not been kept have possible material relevance to his financial condition.”)

In the case of *Tractman,*Bolivia would presumably discover the party to whom Tractman transferred their $33.01 million in promissory notes, what consideration Tractman received in return, and the disposition of that property, information that is relevant to and that directly affects the assets of the debtor and the bankruptcy estate.

The case of Dudley is different. The missing records sought by the AG are those “records necessary to document the inadequately supported transfers made during Dudley’s time as the Schools’ treasurer.” AG’s MSJ, 20. The FFRs generally indicate the absence of supporting documentation sufficient to determine that the expenditure was approved by the school board or was used for a necessary or proper public purpose. For each transaction, the Auditor already knows the account on which the check was drawn and to which school each account belongs, the date of the check, the check number, the amount of the check, and the payee. If the missing records were now to appear, the only additional information they would provide is whether the expenditure was approved by the board and used for a public purpose; that is, whether the expenditures were justified. But they would not help Dudley’s creditors better understand his financial circumstances, or help locate missing or undisclosed assets, or help *720trace the flow of funds through his accounts, or otherwise provide insight into his financial condition. Those records would reveal nothing about Dudley’s financial condition because they do not involve Dudley’s funds or his business transactions; they involve transfers of funds that belonged to community schools.

The AG argues that Dudley, while acting as DFO at the various community schools, failed to properly document the schools’ transactions, that this insufficient documentation led directly to the FFRs, and that Dudley is strictly liable for the amounts set forth in those FFRs; therefore, the-missing records do ultimately impact Dudley’s financial condition. This reasoning, however, conflates two distinct considerations into a single argument.

First is the question of whether Dudley’s recordkeeping was adequate to satisfy his responsibilities as DFO of various community schools. Transactions involving school funds must be supported by sufficient documentation verifying that the transaction was approved by the school board and that the funds were used for a proper purpose. This was not done for each and every transaction, which resulted in the multiple FFRs indicating insufficient documentation. To the extent that Dudley was responsible for keeping and preserving these records as DFO, his recordkeeping was inadequate to satisfy state law, and liability to the State of Ohio may result.

Second is the question of whether Dudley’s recordkeeping was adequate for purposes of § 727(a)(3), that is, whether Dudley failed to keep or preserve any recorded information from which his financial condition and business transactions might be ascertained.--The fact that Dudley may have some liability under the first question — which necessarily becomes a claim in his bankruptcy case — does not mean that the two analyses are to be combined. They are separate and distinct considerations.

Note that this interpretation is consistent with the goal of narrowly construing exceptions to discharge. *Gebhardt v. McKeever (In re McKeever),*550 B.R. 623, 634 (Bankr. N.D. Ga. 2016) (“Because one of the fundamental goals of the Bankruptcy Code is to provide a debtor with a fresh start, a denial of a discharge is an extraordinary remedy and therefore, statutory exceptions to discharge must be construed liberally in favor of the debtor and strictly against the objecting party.” (quotations omitted)).

The Court concludes that the documentation missing from the community school transaction records would not enable Dudley’s actual financial condition or business transactions9 to be ascertained under the *721circumstances of this case and that the AG has not satisfied his burden under *Devaul.*Accordingly, there is no need to address the many arguments and counter arguments made by the parties regarding whether Dudley’s record keeping was justified under all of the circumstances of the case. Dudley is entitled to summary judgment in his favor, and the AG’s objection to Dudley’s discharge under 11 U.S.C. § 727(a)(3) is overruled.

Y. Exception to Discharge under 11 U.S.C. § 623(a)(8)(A)(ii)

Both parties have filed motions for summary judgment regarding the dis-chargeability of Dudley’s FFR liability pursuant to 11 U.S.C. § 523(a)(8)(A)(ii). This section provides as follows:

> (a) A discharge under section 727 ... of this title does not discharge an individual debtor from any debt—

> * * *

> (8) unless excepting such debt from discharge under this paragraph would impose an undue hardship on the debtor and the debtor’s dependents, for—

> * * *

> (A)(ii) an obligation to repay funds received as an educational benefit, scholarship or stipend[.]

11 U.S.C. § 523(a)(8)(A)(ii). A creditor seeking a determination of nondischarge-ability must prove by a preponderance of the evidence that the debt in question is of the type excepted from discharge under this section. *Brown v. Rust (In re Rust),*510 B.R. 562, 567 (Bankr. E.D. Ky. 2014). If the creditor satisfies this burden, the debt may be discharged only if the debtor establishes that repaying the debt would impose an undue hardship on the debtor and the debtor’s dependents. *Id.*Dudley has not raised the issue of undue hardship, so the sole issue before the Court is whether the AG has proven, by a preponderance of the evidence, that Dudley’s liability under the FFRs is “an obligation to repay funds received as an educational benefit” as that phrase is used in 11 U.S.C. § 523(a)(8)(A)(ii).

The AG has provided no case law that directly addresses this specific question, nor has the Court’s own research uncovered any case directly on point.10

The AG argues that the statute sets forth three elements — “an obligation to repay funds,” that were “received,” as an “educational benefit” — and that the facts conclusively establish each element. AG’s MSJ, 11. Dudley’s obligation to repay funds is based on the multiple FFRs finding him personally or jointly liable on certain transactions involving school funds during his time as DFO of the various community schools. Funds were distributed by the Ohio Department of Education either directly or indirectly to the various *722community schools, and Dudley, as DFO, technically received those funds because he had control over the accounts into which such funds were deposited.11 And because the funds were to be used to pay for the schools’ educational activities or education-related expenses, the AG asserts, they constitute educational benefits. The success of the AG’s argument turns on the meaning of “educational benefit.”

The language of the statute is the starting point for interpretation by the Court. *United States v. Ron Pair Enters.,*489 U.S., 235, 241, 109 S.Ct. 1026, 103 L.Ed.2d 290 (1989). If the statute is clear, there is no need for the Court to inquire beyond the plain language of the statute. *Id.*However, if the language is ambiguous or would lead to an absurd result, the Court may try to discern legislative intent. *In re McNabb,*326 B.R. 785 (Bankr. D. Ariz. 2005).

The term “educational benefit” is not defined anywhere in the Bankruptcy Code. Despite the AG’s contention that the statute is plain and unambiguous, the word “benefit” is subject to multiple meanings, several of which fit comfortably into the statutory language. Merriam-Webster defines “benefit” as “something that produces good or helpful results or effects or that promotes well-being: advantage” as in “discounted prices and other benefits of a museum membership” or “The benefits outweigh the risks of taking the drug.” The same dictionary provides a second definition: “a financial help in time of sickness, old age, or unemployment” as in unemployment benefits or disability benefits; and a third: “a service (such as health insurance) or a right (as to take vacation time) provided by an employer in addition to wages or salary” as in “The job doesn’t pay much, but the benefits are good.”12 “[W]hen there is an ambiguous term in a statute, or when a term is undefined or its meaning unclear from the context of the statute, it is our duty to examine the legislative history in order to render an interpretation that gives effect to Congress’s intent.” *United States v. Noland (In re First Truck Lines, Inc.),*48 F.3d 210, 213-14 (6th Cir. 1995), rev’d sub nom. *United States v. Noland,*517 U.S. 535, 116 S.Ct. 1524, 134 L.Ed.2d 748 (1996) (citing *In re Vause,*886 F.2d 794, 801 (6th Cir. 1989)).

The phrase “for an obligation to repay funds received as an educational benefit, scholarship or stipend” was added to § 523(a)(8) as part of the Crime Control Act of 1990. *Dufrane v. Navient Solutions, Inc. (In re Dufrane),*566 B.R. 28, 36-37 (Bankr. C.D. Cal. 2017). The amendment was largely in response to the 8th Circuit Court’s decision in *U.S. Health & Human Servs. v. Smith. Id.*In *Smith,*a medical student accepted scholarship grants from the Physician Shortage Area Scholarship Program (“PSASP”) totaling $13,984. *U.S. Health & Human Servs. v. Smith,*807 F.2d 122, 123 (8th Cir. 1986). PSASP awarded such grants to medical students who agreed to practice medicine following graduation in certain areas where there was a shortage of physicians. The debtor never practiced in a physician shortage area, and the Department of Health and Human Services (“HHS”) demanded that he repay the grants plus interest. The debtor filed bankruptcy, and HHS com*723menced an adversary under § 523(a)(8), which at the time excepted from discharge “any debt ... for ah educational loan made .. ■. by a governmental unit.” *Id.*“[T]he bankruptcy court held that the PSASP grants awarded to [the debtor] constituted a contingent scholarship and not a loan and hence that [the debtor’s] PSASP obligation was dischargeable.” *Id.*(quotations omitted). The district court affirmed. The 8th Circuit reversed, holding that “[a] loan is no less a loan because its repayment is made contingent.” *Id.,*at 125.

Legislative history reveals the intent of the 1990 amendment and indicates the significance of the *Smith*case, as follows:

> This section [amending 11 U.S.C. § 523(a)(8)] adds to the list of nondis-chargeable. debts, obligations to repay educational funds received in the form of benefits (such as VA benefits), scholarships (such as medical service corps scholarships) and stipends. These obligations are often very sizeable and should receive the same treatment as a “student loan” with regard to restrictions on dischargeability in bankruptcy. See U.S. Department of Health and Human Services v. Smith, 807 F.2d 122 (8th Cir. 1986).

Federal Debt Collection Procedures of 1990: Hearing on P.L. 101-647 Before the H. Subcomm. on Econ. and Commercial Law, H. Judiciary Committee 101st Cong. 74-75 (June 14,1990).

The AG urges this Court to adopt the very broad interpretation of “educational benefit” applied by some bankruptcy courts. *See, e.g., Benson v. Corbin (In re Corbin),*506 B.R. 287, 297 (Bankr. W.D. Wash. 2014)(noting that some courts have interpreted § 523(a)(8)(A)(ii) so broadly that “it appears that almost any obligation incurred for the purpose of paying an education-related expense is excepted from discharge”); *Brown v. Rust (In re Rust),*510 B.R. 562, 57Í (Bankr. E.D. Ky. 2014)(“Courts have interpreted § 523(a)(8)(A)(ii) broadly since its addition in 2005.”) However, as shown in the hearing notes, “educational benefit” was not designed to have such an expansive meaning. Instead, it appears the term was originally intended to encompass financial assistance provided for the purpose of pursuing higher education, such as those benefits offered to veterans by the United States Department of Veterans Affairs. While VA benefits were the only example provided, there is no indication that the statute is limited solely to benefits provided through government programs; it also includes funds received by the debtor from other entities, for example, the debt- or’s employer, charitable groups, or religious organizations.

Support for this less expansive interpretation of “educational benefit” is found in the structure of the statute itself.

> The canon of statutory construction known as *noscitur a sociis*instructs that when a statute contains a list, each word in that list presumptively has a “similar” meaning. *Yates v. United States,*— U.S. —, 135 S.Ct. 1074, 1089, 191 L.Ed.2d 64 (2015) (Alito, J., concurring in the judgment) (citing *Gustafson v. Alloyd Co.,*513 U.S. 561, 576, 115 S.Ct. 1061, 131 L.Ed.2d 1 (1995)). To the extent that “educational benefit” (defined nowhere in the Bankruptcy Code) is ambiguous, it should be presumed to have a meaning similar to the other items in the list set forth in § 523(a)(8)(A)(ii). “Scholarship” and “stipend” both refer to funds which are not generally required to be repaid by the recipient.... The concept which unites the three separate terms in the ' list in § 523(a)(8)(A)(ii) is that they all refer to types of conditional grants.

*724*Campbell v. Citibank, N.A. (In re Campbell),*547 B.R. 49, 55 (Bankr. E.D.N.Y. 2016). Thus, the term “educational benefit” should be interpreted as similar to its statutory neighbors, “scholarship” and “stipend.” Scholarships and stipends are both mechanisms for providing students financial assistance that enables them to further their education, or at least pay some portion of their education-related expenses. An educational benefit, then, must be a similar form of financial assistance that provides the same function to students. All three can be differentiated from loans— the most common form of student financing — in that a student agrees from the start to repay the loan. Use of the language “an obligation to repay” in § 523(a) (8) (A) (ii) — and not in § 523(a)(8)(A)(i) or (a)(8)(B) referencing types of loans — suggests that the repayment requirement is not necessarily expected at the outset; that is, the duty to repay may arise in response to, or be contingent upon, the conduct of the recipient. *See Decena v. Citizens Bank (In re Decena),*549 B.R. 11, 20 (Bankr. E.D.N.Y. 2016)(“These ‘educational benefit’ programs trigger section 523(a)(8)(A)(ii)’s ‘obligation to repay funds received’ if the student fails to comply with certain conditions such as grade requirements and post-graduation employment restrictions.”), rev’d in part, vacated in part sub nom. *Citizens Bank v. Decena,*562 B.R. 202 (E.D.N.Y. 2016). This is precisely the situation described in *Smith,*in which a medical student received funds on the condition that he later work in an area where doctors were scarce; when Smith failed to fulfill this requirement, his obligation to repay the monies he had been given arose. In light of the impetus behind the expansion of § 523(a)(8), it appears that “Congress intended section 523(a)(8)(A)(ii) to encompass alternatives to the typical debt- or-creditor relationship in the education context. These alternatives encompass cash benefit programs, such as veteran educational benefits, stipends for teaching assignments, conditional grants, cash scholarships and other obligations that are distinct from student loans.” *Id.,*at 20. While this is clearly not an exhaustive list, this Court believes that it is representative of the types of “obligations to repay funds received as an educational benefit, scholarship or stipend” that Congress intended when crafting this section. And it does not include liability imposed on a community school treasurer for failure to properly document expenditures made by cheeks he signed.

“In interpreting provisions of the Bankruptcy Code, courts must look to the provisions of the whole law, and to its object and policy.” *Chicago Patrolmen’s Federal Credit Union v. Daymon (In re Daymon),*490 B.R. 331, 336 (Bankr. N.D. Ill. 2013)(eitations omitted). “[C]ourts cannot lose sight of the Congressional policy behind the exception itself and must make decisions interpreting the scope of these provisions with these policies in mind.” *Brown v. Rust (In re Rust),*510 B.R. 562, 566 (Bankr. E.D. Ky. 2014). The policy considerations of § 523(a)(8) are relevant when interpreting the language of the statute.

> While the details of § 523(a)(8) have evolved over time, the problem it addresses remains the same: because student loans are generally unsecured and recent graduates often have few or no assets, these debtors have an incentive to try to discharge their educational loans in bankruptcy. If successful, they can then enjoy the higher earning power the loans have made possible without the financial burden that repayment entails. Congress enacted § 523(a)(8) because there was evidence of an increasing abuse of the bankruptcy process that *725threatened the viability of educational loan programs and harm to future students as well as taxpayers. Congress recognized that this is an instance where a creditor’s interest in receiving full payment of the debt outweighs the debtor’s interest in a fresh start.

*Cazenovia College v. Renshaw (In re Renshaw),*222 F.3d 82, 86-87 (2d Cir. 2000). The principal purpose behind § 523(a)(8) was “to protect government entities and nonprofit institutions of higher education-places which lend money or guarantee loans to individuals for educational purposes-from bankruptcy discharge.” *Santa Fe Med. Servs., Inc. v. Segal (In re Segal),*57 F.3d 342, 348 (3d Cir. 1995). *See also Daymon,*490 B.R. at 336 (“Congress believed that the solvency of government-backed student loan programs would be jeopardized unless such loans were made nondischargeable[.]” This is the same policy behind the inclusion of § 523(a)(8)(A)(ii) in 1990, to protect the entities making such conditional grants and thereby safeguard the future availability of this type of student financing. *See*Hearing on P.L. 101-647, 74-75 (June 14, 1990) (“These obligations are often very sizeable and should receive the same treatments as a ‘student loan’ with regard to restrictions on dis-chargeability in bankruptcy.”) If a student could accept a conditional grant, then both fail to fulfill the condition upon which the grant was provided *and*avoid any obligation to repay that grant through discharge in bankruptcy, the result would be a total loss to the entity making such grant. Such entities would then be less willing to make these types of conditional grants in the future, which would result in an overall decrease in financing options available to students. Providing that obligations to repay educational benefits, scholarships, and stipends are excluded from the bankruptcy discharge helps to ensure that such conditional grants are available to students in the future.

This policy further clarifies that § 523(a)(8) was intended to apply to various forms of voluntary financing available to students to pay their educational expenses, and not to the type of involuntary liability imposed on Dudley in the present case. The AG argues that § 523(a)(8)’s purpose of ensuring that educational programs remain solvent by preserving scarce financing funds is also applicable in the instant case. This policy goal would be furthered, he argues, by excluding from discharge claims against those responsible for misapplying educational funds, such as those against Dudley, and ultimately returning funds to the State of Ohio to be used for future educational programs. Such policy similarities, however, do not justify stretching the interpretation of a statute to encompass a type of debt that Congress never intended to be included.13

*726With this in mind, the Court declines the AG’s invitation to broadly interpret the term “educational benefit” as funds provided for the purpose of paying any education-related expense. Section § 52S(a)(8)(A)(ii) is “not a ‘catch-all’ provision designed to encompass any educational claim arising out of any transaction that bestows an educational benefit on a debt- or.” *Decena,*549 B.R. at 20; *Institute of Imaginal Studies dba Meridian Univ. v. Christoff (In re Christoff),*527 B.R. 624, 634 n.9 (9th Cir. BAP 2015)(same). A narrower interpretation is called for by both the legislative history and the construction of the statute -itself, as well as by the recognized principle that exceptions to discharge “should be confined to those plainly expressed” in the statute. *Kawaauhau v. Geiger,*523 U.S. 57, 62, 118 S.Ct. 974, 140 L.Ed.2d 90 (1998) (quoting *Gleason v. Thaw,*236 U.S. 558, 562, 35 S.Ct. 287, 59 L.Ed. 717 (1915)); *Christoff,*527 B.R. at 629.

Dudley’s debt to the State of Ohio stems from strict liability imposed by statute; essentially, it is a penalty for improper, or at least incomplete, job performance as found by the Auditor and detailed in multiple FFRs. Such liability is not an obligation to repay educational funds received in the form of benefits (such as VA benefits), as suggested by the legislative history. Nor were the funds involved a type of conditional grant provided to help finance Dudley’s education, as suggested by the proximity of the term “educational benefit” to the presumptively similar terms “scholarship” and “stipend.” And the policy leading to the addition of § 523(a)(8) makes clear that the exception from discharge was intended to apply to student loans and other types of financing mechanisms available to enable students to further their education. There is no indication that a debt such as Dudley’s FFR liability was ever intended to fall within the scope of the statute. The AG’s insistence that the language is plain and unambiguous, and that this Court is therefore precluded from consulting legislative history, policy, or the cannons of statutory construction, is unpersuasive given that the term “educational benefit” is undefined and the word “benefit” is subject to multiple meanings.

This Court concludes that Dudley’s FFR liability is not an obligation to repay funds received as an educational benefit, and therefore does not fall within the exception to discharge set forth in § 523(a)(8)(A)(ii). Dudley is therefore entitled to judgment as a matter of law as to this claim.

VI. Exception to Discharge under 11 U.S.C. § 523(a)(4)

In his Complaint, the AG asserts that liability imposed on Dudley by certain FFRs is nondischargeable because of Dudley’s defalcation while acting in a fiduciary capacity. Dudley argues that the AG’s allegations, “even if true, do not meet the defalcation requirements and therefore, this claim should be dismissed as a matter of law.” Dudley’s MSJ, 10. Section 523(a)(4) of the Bankruptcy Code provides as follows:

> (a) A discharge under section 727 ... of this title does not discharge an individual debtor from any debt—

> 

> (4) for fraud or defalcation while acting in a fiduciary capacity, embezzlement, or larceny

11 U.S.C. § 523(a)(4).

The phrase “while acting in a fiduciary capacity” applies only to the words “fraud or defalcation”; embezzlement and larceny are separate grounds for non-dischargeability under § 523(a)(4) whether or not a fiduciary relationship existed. *Nat’l City Bank v. Imbody (In re Imbody),*104 B.R. 830, 840 (Bankr. N.D. *727Ohio 1989). Therefore, § 523(a)(4) sets forth three separate, alternative grounds for nondischargeability: if the debt is for (1) fraud or defalcation while acting in a fiduciary capacity, (2) embezzlement, or (3) larceny. *First Assembly of God v. Ping (In re Ping),*506 B.R. 486, 494 (Bankr. S.D. Ohio 2014). To prevail on a claim for defalcation while acting in a fiduciary capacity, a plaintiff must show by a preponderance of the evidence “(1) a preexisting fiduciary relationship;14 (2) breach of that fiduciary relationship; and (3) a resulting loss.” *Commonwealth Land Title Co. v. Blaszak (In re Blaszak),*397 F.3d 386, 390 (6th Cir. 2005).

In addition to the elements set out in *Blaszak,*the Supreme Court has determined that defalcation, like the other terms in § 523(a)(4) — fraud, embezzlement, and larceny — requires a culpable state of mind as well. *Bullock v. BankChampaign, N.A.,*569 U.S. 267, 133 S.Ct. 1754, 1757, 185 L.Ed.2d 922 (2013). “We describe that state of mind as one involving knowledge of, or gross recklessness in respect to, the improper nature of the relevant fiduciary behavior.” *Id.*The Supreme Court further described the scope of this scienter requirement, as follows:

> [W]here the conduct at issue does not involve bad faith, moral turpitude, or other immoral conduct, the term requires an intentional wrong. We include as intentional not only conduct that the fiduciary knows is improper but also reckless conduct of the kind that the criminal law often treats as the equivalent. Thus, we include reckless conduct of the kind set forth in the Model Penal Code. Where actual knowledge of wrongdoing is lacking, we consider conduct as equivalent if the fiduciary “consciously disregards” (or is willfully blind to) “a substantial and unjustifiable risk” that his conduct will turn out to violate a fiduciary duty. ALI, Model Penal Code § 2.02(2)(c), p. 226 (1985). *See id.,*§ 2.02 Comment 9, at 248 (explaining that the Model Penal Code’s definition of “knowledge” was designed to include “‘wilful blindness’ ”). That risk “must be of such a nature and degree that, considering the nature and purpose of the actor’s conduct and the circumstances known to him, its disregard involves *a gross deviation*from the standard of conduct that a law-abiding person would observe in the actor’s situation.” *Id.,*§ 2.02(2)(c), at 226 (emphasis added).

*Id.,*at 1759-60. This scienter requirement is satisfied where a creditor shows that the fiduciary was subjectively aware of and that he consciously disregarded — or that the fiduciary was willfully blind to — a substantial and unjustifiable risk that his conduct might violate a fiduciary duty. *See MacArthur Co. v. Cupit (In re Cupit),*514 B.R. 42, 49-52 (Bankr. D. Colo. 2014) (thoroughly analyzing the *Bullock*scienter requirement).

Dudley asserts that the AG has not put forth any evidence of scienter and that this is fatal to his claim under § 523(a)(4). However, the culpable state of mind requirement will rarely be admitted; it must be inferred from the circumstances of the case. *See Sacklow v. Vecchione (In re Vecchione),*407 F.Supp. 609, 615 (E.D.N.Y. 1976)(“Persons whose intention it is to shield their assets ... rarely announce their purpose. Instead, if their intention is to be known, it must be gleaned from inferences drawn from a course of conduct.”); *Cupit,*514 B.R. at 51 (“Conscious disregard, like other intent ele*728ments, may be inferred from the particular facts of the case.”); *People v. Hall,*999 P.2d 207, 220 (Colo. 2000) (“A court or trier of fact may infer a person’s subjective awareness of a risk from the particular facts of a case, including the person’s particular knowledge or expertise.”).

Drawing all inferences in favor of the AG, there is sufficient evidence in the record from which a reasonable trier of fact might conclude that Dudley possessed the requisite scienter to support a finding of defalcation. Prom Dudley’s experience, education, and training, a trier of fact might reasonably infer that Dudley was aware of a substantial and unjustifiable risk that his conduct might violate his fiduciary duties and that he consciously disregarded that risk by failing to correct his record keeping practices and by repeating the same behaviors at other schools, accumulating over 80 FFRs during his time as DFO.

Dudley also argues that “the AG has failed to demonstrate that the Schools have suffered any losses as a result of the Debtor’s alleged defalcation, which constitutes a separate basis on which to grant summary judgment.” Dudley’s Memorandum, 21. However, the AG’s documents detail $42,800 worth of payments from some of the community schools to Dudley or Dudley’s company, LED Consulting, that the Auditor determined to be over-payments. AG’s MSJ, 18. Again, drawing all inferences in favor of the nonmoving party, a trier of fact could, very well conclude. that these constitute payments to Dudley in excess of what Dudley should have properly received, and that this constitutes a real and substantial loss to the community schools.

Dudley moved for summary judgment on the grounds that the record contained no evidence to support two essential elements of the AG’s § 523(a)(4) claim: the scienter requirement established by *Bullock*and that the alleged defalcation resulted in a loss. However, the Court finds that there is sufficient evidence in the record as to each element to overcome Dudley’s MSJ. Accordingly, Dudley has not satisfied his burden and, therefore, is not entitled to summary judgment on this claim.

VII. Conclusion

For the foregoing reasons, the Court finds that the AG is not entitled to summary judgment on his claim for nondis-chargeability under 11 U.S.C. § 523(a)(8)(A)(ii). Dudley is entitled to summary judgment as to claims under 11 U.S.C. §§ 523(a)(8)(A)(ii) and 727(a)(3), but not on the claim under 11 U.S.C. § 523(a)(4). Accordingly, it is

ORDERED AND ADJUDGED that the AG’s *Motion for Partial Summary Judgment*(Doc. 33) is DENIED, It is further

ORDERED AND ADJUDGED that Dudley’s *Motion for Summary Judgment*(Doc. 26) is GRANTED as to the claims of the Complaint brought under § 523(a)(8)(A)(ii) and § 727(a)(3) and DENIED as to the claim of the Complaint brought under § 523(a)(4).

A separate partial final judgment as to the claims of the Complaint brought under § 523(a)(8)(A)(ii) and § 727(a)(3) will be entered in accordance with the foregoing.

The claim of the Complaint brought under § 523(a)(4) will be set for a pre-trial conference by separate notice.

IT IS SO ORDERED.

1

. The Plaintiff filed an Amended Memorandum (Doc. 38) to correct certain erroneous references to the evidentiary materials filed with the brief.

2

. The State of Ohio initiated several lawsuits against Dudley and others to reduce certain audit findings to judgment: Case No. CV-14-820432 *Ohio Department of Education v. Baker,*Case No. CV-14-835532 *Ohio Department of Education v. Scott,*and Case No. CV-14-836245 *Ohio Department of Education v. Weems*in the Cuyahoga County Common Pleas Court, and Case No. 15 CV 001838 *State ex rel. Ohio Attorney General Michael DeWine v. Coles*in the Franklin County Common Pleas Court. Each of these cases was stayed as to Dudley following the filing of his petition for relief; no judgment was issued against Dudley in any of these cases.

3

. Nonetheless, the Court is not required to "speculate on which portion of the record the nonmoving party relies, nor is it obligated to wade through and search the entire record for some specific facts that might support the nonmoving party’s claim.” *InterRoyal Corp. v. Sponseller,*889 F.2d 108, 111 (6th Cir. 1989).

4

. The Ohio Revised Code uses the term "community schools.” These schools are also commonly known as "charter schools.” Within this opinion, the terms are used interchangeably.

5

. Although an FFR may assess liability by naming the individuals or entities responsible for the repayment of public monies, the FFR is not a judgment; it is evidentiary in nature. “A certified copy of any portion of the [Auditor’s] report containing factual information is prima-facie evidence in determining the truth of the allegations Ohio R.C. § 117.36. The Auditor’s findings "constitute reliable, probative and substantial evidence for purposes of an agency sustaining its burden of proof” in an administrative procedure. *In re Scott,*Report and Recommendation (Ohio Bd. of Educ. Jan. 15, 2013), p. 11; see *also In re Chuck,*Report and Recommendation (Ohio Bd. of Educ. May 24, 2014), p. 31.

6

. The AG alleges that Dudley was, at one time or another, the DFO of 23 different community schools, which Dudley denies. It is undisputed that Dudley acted as DFO, for various time periods, for at least the following eight community schools in Ohio: Carter G. Wood-son Institute in Dayton, Lion of Judah Academy in Cleveland, Arts Academy in Lorain County, Weems School and Marcus Garvey Academy in Cuyahoga County, Phoenix Village Academy Primary I in Summit County, George Washington Carver Preparatory Academy in Franklin County, and the Urban Youth Academy in Clark County. Dudley denies that he was DFO of either the Notten School for Technology, Engineering, & Mathematics or the Arts Academy West. All of these ten community schools are now closed.

7

. Ohio Rev. Code § 2921.42 provides as follows:

> (A) No public official shall knowingly do-any of the following:

> (1) Authorize, or employ the authority or influence of the public official’s office to secure authorization of any public contract in which the public official, a member of the public official’s family, or any of the public official's- business associates has an interest;

> (2) Authorize, or employ the authority or influence of the public official’s office to secure the investment of public funds in any share, bond, mortgage, or other security, with respect to which the public official, a member of the public official’s family, or any of the public official’s business associates either has an interest, is an underwriter, or receives any brokerage, origination, or servicing fees;

> (3) During the public official’s term of office or within one year thereafter, occupy any position of profit in the prosecution of a public contract authorized by the public official or by a legislative body, commission, or board of which the public official was a member at the time of authorization, unless the contract was let by competitive bidding to the lowest and best bidder;

> (4) Have an interest in the profits or benefits of a public contract entered into by or for the use of the political subdivision or governmental agency or instrumentality with which the public official is connected;

> (5) Have an interest in the profits or benefits of a public contract that is not let by competitive bidding if required by law and that involves more than one hundred fifty dollars.

Ohio Rev. Code § 2921.42(A)

8

. The Complaint also contained a count seeking to hold Dudley’s liability nondischargeable under § 523(a)(3)(A), but that claim was later voluntarily dismissed by the AG (Doc. 32).

9

. The Court has found one case that reached the opposite conclusion. *See DeWine v. Scott (In re Scott),*566 B.R. 471 (Bankr. N.D. Ohio 2017). This case was not cited by either party because it was decided after the final briefs were submitted, but the facts of *Scott*are very similar to the facts currently before this Court. The *Scott*case involved a debtor who founded and operated two community schools in Cleveland, Ohio, and was subject to FFRs finding him liable on various transactions of school funds. The Ohio Attorney General, who is also the plaintiff in this case, brought an adversary seeking (1) a money judgment based on audit findings, (2) to deny the debt- or’s discharge under § 727(a)(3), and (3) to find the debt nondischargeable under § 523(a)(8)(A)(ii). The bankruptcy court evaluated the sufficiency of debtor’s record keeping as superintendent of the schools and found that he had failed to keep adequate records of his business transactions, Because the debtor failed to provide any explanation of why this was justified under the circumstances, the court granted summary judgment on the § 727(a)(3) claim. The *Scott*case, however, is different from the instant case in one major respect: in *Scott,*the “parties stipulated that all the matters underlying the audit findings described in the amended complaint are *721'business transactions' within the meaning of § 727(a)(3).” *Id.*at 480, n.21. There is no such stipulation in this case, and to the extent that the bankruptcy court in *Scott*determined that a debtor could be denied discharge for failing to preserve or maintain records that did not reflect on his own financial condition, this Court respectfully disagrees.

10

. The Court did find another bankruptcy case in which this exact issue had been presented, but not decided. *See DeWine v. Scott (In re Scott),*566 B.R. 471 (Bankr. N.D. Ohio 2017). In *Scott*the bankruptcy court evaluated whether FFR liability similar to that imposed on Dudley should be excepted from discharge under § 523(a)(8)(A)(ii) and whether the debtor’s discharge should be denied under § 727(a)(3) for failure to preserve and maintain certain records related to transaction of community school funds. Because the bankruptcy court granted summary judgment on the § 727(a)(3) claim, it declined to address the merits of the § 523(a)(8)(A)(ii) claim as moot.

11

. The AG also points out that the audit findings indicate that payments totaling $48,200 were improperly made either directly to Dudley or to his company, LED Consulting, showing that Dudley personally received at least this portion of the funds at issue.

12

. Available at https://www merriam-web-ster.com/dictionary/benefit, last visited August 4, 2017.

13

. The policy argument made by the AG is not without merit, and the Court fully understands the impact he is hoping to achieve: holding that FFR liability is nondischargeable pursuant to § 523(a)(8)(A)(ii) would send a powerful message that "those who handle school funds cannot escape [through bankruptcy] accountability for facilitating abuse of those funds. That would go a long way toward deterring future abuses,” AG's Reply, 8. While deterring abuse in the community school context is a laudable goal, that is not within the purview of this Court. Instead, the Court must interpret the Bankruptcy Code as written, and when a statute is unclear or ambiguous, interpret the statute to effect Congressional intent. To "send a powerful message,” the AG must look elsewhere for assistance. “Because community schools are a creation of the Ohio legislature, that entity can certainly take the lead to protect Ohio's vulnerable children by adopting legislation that would provide better safeguards against misuse of public money by community school owners and operators.” *Scott,*566 B.R. at 481.

14

. Dudley concedes, for the purpose of his motion for summary judgment only, that he was a fiduciary for the community schools during the times he served as DFO, and that he held funds in trust for those schools. Dudley’s MSJ, 10-11.