A former Los Angeles Unified School District (LAUSD) IT employee and a tech company owner have been charged in a $22 million fraud scheme, prosecutors say. Hong "Grace" Peng, a former LAUSD technical project manager, and Gautham Sampath, owner of Innive, allegedly orchestrated a "pay-to-play" scheme between 2018 and 2022 that diverted taxpayer funds meant for students.
Peng and Sampath are accused of steering contracts tied to LAUSD’s My Integrated Student Information System (MiSiS) to Innive, with prosecutors alleging Sampath funneled over $3 million back to Peng through intermediaries. Both face felony charges, including money laundering and illegally holding financial interests in government contracts.
Prosecutors cited text messages between the two, including one where Peng allegedly wrote, "I broke all law for you already lol." Peng resigned in 2022 after a search warrant was served at her home and workplace. The scheme predates the tenure of current Superintendent Alberto Carvalho, who is separately under investigation for unrelated allegations.
The case highlights systemic vulnerabilities in contract oversight within the nation’s second-largest school district. LA County District Attorney Nathan Hochman described the scheme as one of the largest in LAUSD history, emphasizing the misuse of funds intended for student services.