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Political Contributions Associated With Virtual Schools Charged With Misappropriating Public Funds

February 27, 2020

curtis-hill attorney general indianaAttorney General Curtis Hill announced today that recipients of contributions from affiliates of two online schools that were found by the Indiana State Board of Accounts (SBOA) to have misappropriated funds should have the option of remitting the sum of those contributions to the Indiana Treasurer of State’s Office.

As has been widely reported, the SBOA announced on February 12 its conclusion that public funds were misappropriated through malfeasance, misfeasance, and/or nonfeasance by Indiana Virtual School (IVS) and Indiana Virtual Pathways Academy (IVPA).

Specifically, the SBOA determined that IVS and IVPA inappropriately received more than $68.7 million, collectively, from the State of Indiana based on misrepresentations regarding the number of enrolled and attending students.

The SBOA also found that both virtual schools inappropriately disbursed more than $85.7 million, collectively, in public funds to vendors in situations where there was no invoice or no itemized information on the invoice, and a related party was involved.

“These revelations may be troubling to political candidates who received financial contributions from these schools or their affiliates,” Attorney General Hill said. “Donating the funds to charity may be a way of divesting from these organizations, but depositing the funds with the state subject to a completed investigation and final resolution may better preserve the state’s interest in restitution.”

Under Indiana law, the Office of the Treasurer holds fiduciary responsibility for state funds, Attorney General Hill noted. “Because this money may belong to the State of Indiana and Hoosier taxpayers, these funds could be protected until a final disposition,” Attorney General Hill said. “This would provide a secure option for those who feel compelled to return the funds. Last Friday, my office requested that the Indiana Treasurer of State’s Office designate an account that will protect the state’s interest in this regard.”