The former director of the Indiana Virtual School was found guilty of fraud on Thursday, Nov. 5, over his role in a scheme to inflate enrollment in order to draw $44 million in student funding from Indiana.
Philip Holden faced 17 counts of wire fraud and one count of conspiracy to commit wire fraud, and he was found guilty on all counts. According to the indictment, Holden was responsible for student enrollment, attendance and teacher compensation at Indiana Virtual School and at a related school, Indiana Virtual Pathways Academy.
Prosecutors alleged that Holden, school founder Thomas Stoughton and former superintendent Percy Clark inflated enrollment numbers to receive per-pupil funding from the state, and that the schools then funneled money to for-profit companies owned by Stoughton and paid it out to people involved in the case.
Clark previously pleaded guilty to conspiracy to commit wire fraud in June 2025 and agreed to pay back about $1.3 million. Stoughton pleaded guilty to fraud charges the day before a joint trial for himself and Holden was due to begin.
Holden's defense characterized him as a fall guy who did not financially benefit from the scheme. His attorney said Holden was only paid for his labor. Holden is due to be sentenced on Feb. 25.
