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The previous superintendent of the 2 digital constitution colleges on the heart of a statewide enrollment scandal has pleaded responsible to a conspiracy to commit wire fraud.
Percy Clark has agreed to pay a judgment of roughly $1.3 million, the quantity he acquired as a part of what federal prosecutors have known as a broader conspiracy to defraud the Indiana Division of Schooling, based on a plea settlement submitted to a federal choose final week.
If accepted by the courtroom, the plea deal can be one step in the direction of recovering funds from the alleged scheme that generated each a federal indictment and a separate lawsuit from Indiana Legal professional Common Todd Rokita.
Each circumstances allege that Clark, together with college founder Thomas Stoughton and different defendants, falsely inflated enrollment figures at Indiana Digital Academy and Indiana Digital Pathways Academy. Federal prosecutors allege they defrauded the state of $44.6 million. Rokita’s lawsuit has alleged $154 million in fraud.
The authorized actions comply with a 2017 Chalkbeat investigation that discovered enrollment on the colleges ballooned, and that state funds went to a for-profit firm based by Stoughton. After each colleges closed in 2019, a 2020 Indiana State Board of Accounts report known as on the colleges to repay over $85 million in state cash.
It’s unclear what social gathering would obtain Clark’s $1.3 million fee.
Clark has agreed to forfeit different belongings if he’s unable to pay again the judgment in full. He has additionally agreed to 60 months of probation, the primary 24 of which he can be confined to his residence with out an digital monitoring gadget.
Clark initially confronted 18 counts of wire fraud and 11 counts of cash laundering within the federal indictment, however prosecutors have agreed to dismiss the remaining counts.
Clark’s lawyer didn’t reply to a request for remark. An individual who answered a telephone quantity listed for Clark stated that he was not residence.
Plea settlement acknowledges ‘excessive chance’ of fraud
Within the plea settlement, Clark admits that there was a “excessive chance” that the colleges inflated enrollment and that “he averted studying whether or not or not that was in actual fact the reality, which it was.”
Separate from the financial judgment, Clark has additionally agreed that the scheme finally requires $44.6 million in complete restitution which he and different defendants within the federal case are accountable for repaying. However it’s unclear how a lot of that he might find yourself paying, or whether or not the $1.3 million financial judgment might depend towards his portion of the entire restitution. The federal case involving Stoughton and a 3rd defendant, Phillip Holden, is ongoing.
Different former workers who additionally confronted federal authorized motion can be accountable for paying again the $44.6 million in restitution as outlined of their plea agreements — though actual quantities per defendant are unclear.
College operations supervisor Christopher King pleaded responsible in November 2023 of conspiracy to commit wire fraud, based on courtroom paperwork. Kyle Schroeder, a supervisor of pupil service representatives, additionally pleaded responsible to concealing a felony in March 2024, based on courtroom paperwork.
Federal prosecutors have additionally alleged that Stoughton finally used state cash to make over $40,000 in marketing campaign contributions to Republican candidates in 2018. He’s additionally accused of utilizing state funds to buy a Cadillac, gold cash, Tiffany jewellery, and tuition to the non-public Park Tudor college.
The state’s lawsuit — which additionally lists Stoughton’s spouse, Rhonda Stoughton, as a defendant — is ongoing.
Amelia Pak-Harvey covers Indianapolis and Lawrence Township colleges for Chalkbeat Indiana. Contact Amelia at apak-harvey@chalkbeat.org.
