LA school district employee, tech firm owner accused in $22M pay-to-play scheme
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A former Los Angeles Unified School District (LAUSD) IT employee and a technology company owner is facing charges in what prosecutors described as one of the “largest” alleged money laundering schemes in district history.
Hong “Grace” Peng, a former LAUSD technical project manager, and Gautham Sampath, owner of tech firm Innive, are accused of orchestrating a years-long “pay-to-play” scheme that allegedly diverted more than $22 million to Sampath’s company in school district contracts.
“This case involves a blatant abuse of the public trust, involving the diversion of taxpayer dollars intended for students into personal safes,” Los Angeles County District Attorney Nathan Hochman said in a statement. he said.
“This vendor, working with an LAUSD project manager, allegedly operated a multi-year, multi-contract pay-for-play arrangement that funneled millions of dollars through our schools.”
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Los Angeles Unified School District headquarters are in downtown Los Angeles. (Justin Sullivan/Getty Images)
According to prosecutors, Peng played a role in awarding contracts tied to LAUSD’s My Integrated Student Information System (MiSiS) between 2018 and 2022.
Authorities allege that these contracts, totaling $22 million, were largely directed to Innive.
Investigators say Sampath funneled more than $3 million back to Peng through intermediaries.
Prosecutors say messages between the two show discussions about deleting chats, securing contracts and moving money.
Peng, a Pasadena resident, was charged with money laundering and illegally obtaining financial benefits from government contracts.
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Sampath, of Flower Mound, Texas, faces similar charges and is also charged with aiding and abetting a public servant.
An arrest warrant has been issued for Peng, while Sampath faces extradition to California. Court dates have not yet been set.
Peng resigned from LAUSD in late 2022 after investigators executed search warrants at his home and business.
Authorities say Sampath and his company continue to pursue government contracts in California and across the country.
If convicted, both defendants could face up to seven years in county jail.
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Los Angeles County District Attorney Nathan Hochman called the case a “blatant abuse of the public trust.” (Derek Shook for Fox News Digital)
“We will not tolerate public officials who sell their responsibilities or contractors who line their pockets by gaming the system,” Hochman added. “Both will be held fully accountable.”
LAUSD said in a statement that it was aware of the allegations against Peng.
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“LAUSD is committed to full compliance with all applicable laws, and we expect our employees and business partners to adhere to the highest standards of ethics and integrity,” the school district said in a statement. “The district will continue to cooperate fully with the relevant authorities.”
Innive did not immediately respond to Fox News Digital’s request for comment.
