Lawsuit filed against defendants in alleged multi-million dollar Limestone County school fraud scheme

Alabama

HUNTSVILLE, Ala. – There are new details in the alleged multi-million-dollar school fraud scheme in Limestone County. Six people including former superintendents Trey Holladay and Tom Sisk were indicted earlier this year on federal charges of conspiracy to defraud the United States. Now, they’re also facing a civil lawsuit filed by attorneys based in Huntsville.

Holladay, Sisk, and four others are accused of falsely enrolling students from Alabama’s Black Belt in virtual learning programs in Athens City and Limestone County Schools.

“Then they were getting money from the State of Alabama, and then that money was leaving Athens City Schools and then funneled out to these LLCs controlled by these defendants that were running the virtual academy,” said Eric Artip, of Mastando and Artrip.

The civil class action lawsuit was filed against Holladay, Sisk and the four others who were indicted, as well as the LLCs they allegedly used to funnel money in the scheme. Will League and Eric Artrip are Huntsville-based attorneys representing the plaintiffs, children whose identity was allegedly stolen in the alleged scheme.

The lawsuit was filed in Barbour County where Lakeside School, one of the private schools involved in the case, is located. The civil suit also says Jackson Academy, Pickens Academy and Southern Academy, in addition to Lakeside Academy, signed enrollment forms for students to attend a virtual school in the Athens City School District.

According to the civil suit, “defendants offered incentives of technology and web-based educational resources, as well as fringe benefits and perks to private schools with minial means in exchange for private student information, including dates of birth, addresses, Social Security identification numbers.”

Atrip and League don’t know exactly how many children were victims of the scheme, but court documents from the civil lawsuit say there are approximately 94 persons in the puntative class.

Federal investigators say in an attempt to keep this fraud from being brought to light, the defendants went as far as to create fake report cards, transcripts, and even home addresses and report those to the state.

League and Artrip say their clients are concerned about how that could affect them in the future.
“How will this affect their child? As they’re going through the application process to college… We’re in a different area of trying to secure transcripts, grades past achievements to make sure that they can, that their academic record is intact,” said Will League, of Sinard, Timberlake and League, P.C.

The lawsuit also asks for punitive damages to be awarded to students’ families. According to federal investigators the defendants allegedly funneled millions of dollars to school systems in Limestone County.

“That identity theft resulted in a lot of money going toward these defendants. We think that money ought to be turned over to the parents,” Artrip stated.

As for the criminal case, three of the defendants pleaded guilty last week. Those defendants were Tom Sisk, David Tutt and Greg Corkren.

A trial date is set later this year for former Athens City Schools Superintendent Trey Holladay, his wife Deborah and Richard Carter. Carter was currently employed by the Athens school system when he was indicted.

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