Lawsuit seeks $150M from Indiana online schools fraud claims

Regional News

FILE- In a Sept. 13, 2019 file photo the closed office of Indiana Virtual School, in Indianapolis, is seen with a message to creditors taped to the door stating that it no longer had assets or bank accounts. The leaders of two now-closed Indiana online charter schools are accused in a new lawsuit of defrauding the state of more than $150 million by padding their student enrollments and inappropriately paying money to web of related businesses. (AP Photo/Tom Davies, File)

INDIANAPOLIS (AP) — The leaders of two now-closed Indiana online charter schools are accused in a new lawsuit of defrauding the state of more than $150 million by padding their student enrollments and inappropriately paying money to a web of related businesses.

The lawsuit announced Monday by the Indiana attorney general’s office comes nearly two years after Indiana Virtual School and Indiana Virtual Pathways Academy shut down amid a state investigation that found they improperly claimed about 14,000 students as enrolled even though they had no online course activity.

An audit linked much of the misspending to Thomas Stoughton, who headed the schools until 2017. An attorney for Stoughton declined to comment.

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