The Kofflers appear to have treated Sunshine Developmental School as the family’s personal ATM, according to the agreement with the attorney general’s office. They set up a pass-through company that effectively controlled the lease for the school’s main program in Queens. That company, called Bridan Realty III, (from a combination of the Koffler sons’ first names), then charged the school a marked-up rent that was roughly twice what the company was actually paying for the property.

Money from those rent payments, which totaled over $3.5 million from 2006 to 2010, went into an account controlled by Michael Koffler, from which the family drew regularly, according to the agreement. There were frequent checks to Michael, in amounts as large as $116,000; recurring monthly payments of $2,500 each to Brian and Daniel; hundreds of thousands of dollars in payments to credit card accounts controlled by the family; checks for boat maintenance; and checks to Brian’s law school.

An audit of Michael, Brian and Daniel Koffler by the state’s Department of Taxation and Finance also revealed that the three together had failed to report millions of dollars in income from K3 Learning, then known as MetSchools, and its related companies.

Michael Koffler purportedly made a $12 million loan to MetSchools, which allowed him to claim a $12 million loss on his personal tax returns. The Taxation and Finance Department could find no proof that he had made such a loan.

In addition, MetSchools and other related companies claimed $1.6 million of the family’s personal expenses as deductible business expenses. The expenses included rental payments on a New York City apartment, department store purchases, car loan payments, utility and maintenance payments on the family’s vacation home in Westhampton Beach, Long Island, and purchases made in Westhampton Beach and St. Barts, the Caribbean island.