INDIANAPOLIS, Ind. — A federal jury in Indianapolis on Thursday convicted Philip Holden, the former director of the Indiana Virtual School, on every count he faced, finding that he took part in a scheme that inflated the online school's enrollment and siphoned $44 million in student funding from the state of Indiana, Chalkbeat Indiana reported on Friday, November 6.
Holden faced 17 counts of wire fraud and one count of conspiracy to commit wire fraud, and the jury found him guilty on all counts. In his role at the Indiana Virtual School (IVS) and at Indiana Virtual Pathways Academy (IVPA), a related online school, Holden was responsible for student enrollment, attendance and teacher compensation, according to the federal indictment in the case.
Prosecutors alleged in the indictment that Holden, together with school founder Thomas Stoughton and former superintendent Percy Clark, inflated the schools' enrollment numbers so the schools would receive more per-pupil funding from the state than they were entitled to. The indictment says the schools then funneled that money to for-profit companies owned by Stoughton and paid it out to Stoughton, Clark and others involved in the case.
A verdict that follows the trial Awaaz Punjab covered last month
The conviction is the verdict phase of the case readers followed when Holden's trial opened in federal court in Indianapolis in late October. Holden was the sole defendant at trial: Stoughton pleaded guilty to fraud charges the day before a joint trial of the two men was due to begin, and Clark had pleaded guilty to conspiracy to commit wire fraud in June 2025 and agreed to pay back around $1.3 million.
Holden's defense took a different position from the two men who pleaded guilty. His attorneys characterized him as a fall guy who did not financially benefit from the scheme the way more senior administrators did. "My client did not take a dime," Holden's attorney, Jon Little, told Chalkbeat on Friday. "My client is not even alleged to have taken a dime. My client was only paid for his labor." The jury, after hearing the trial evidence, convicted on all counts regardless.
Background: a school undone by its own numbers
The case traces back to a 2017 Chalkbeat investigation of the Indiana Virtual School, which found ballooning enrollment, financial conflicts of interest and just one teacher for every 222 students. That reporting led Indiana lawmakers to tighten funding and attendance requirements for virtual schools. Both IVS and IVPA closed in 2019. A federal grand jury indicted Holden and Stoughton in January 2024, and Indiana Attorney General Todd Rokita has filed a separate civil lawsuit seeking $154 million from the schools, their officers and their companies.
For Indiana families, the case is a landmark in how publicly funded online education is policed. The schools were charter schools paid with public money on the basis of reported enrollment — the very numbers prosecutors said were inflated — which is why the reporting rules that followed the 2017 investigation, and now a jury verdict, matter to any parent choosing a virtual school and to every taxpayer funding one.
Holden is due to be sentenced on February 25. The U.S. Attorney's Office for the Southern District of Indiana did not immediately return a request for comment after the verdict, Chalkbeat reported. The state's separate $154 million civil case against the schools and their officers continues alongside the criminal case.
No sentence has been imposed yet, and the February 25 sentencing will decide what punishment follows a conviction on all 18 counts. Reporting for this story is based on Chalkbeat Indiana's verdict coverage of November 6, 2026 and the Indianapolis Focal's report of the conviction, with background from Chalkbeat's trial coverage in October 2026.