A former Los Angeles Unified School District employee and a Texas tech company owner are facing felony charges in what prosecutors are calling the largest money laundering scheme in the district’s history — an alleged pay-to-play arrangement that steered more than $22 million in contracts to a single vendor over four years.
Hong “Grace” Peng, 53, of Pasadena, worked as a technical project manager for the Los Angeles Unified School District (LAUSD) when prosecutors say she illegally helped direct millions of dollars in contracts to Innive, a Texas-based technology company. In return, Innive’s owner allegedly funneled more than $3 million back to her through a network of intermediaries.
According to KTLA, the scheme unfolded between 2018 and 2022 and centered on contracts for the district’s My Integrated Student Information System (MiSiS), a platform used to manage student records across the district.
Gautham Sampath, 53, of Flower Mound, Texas, owns Innive and is accused of routing the kickback payments to Peng. He faces three felony counts: money laundering, having a financial interest in a contract or purchase made in an official capacity, and aiding and abetting a government official to have a financial interest in a contract or purchase made in an official capacity.
Peng faces two felony counts — money laundering and having a financial interest in a contract made in an official capacity.
The case first came to light in April 2022. Investigators served search warrants at Peng’s Pasadena home and her LAUSD workplace later that year. As reported by the San Gabriel Valley Tribune, Peng resigned from the district shortly after those warrants were served. Since then, LAUSD’s Office of Inspector General and the District Attorney’s Bureau of Investigation have been actively working the case.
An arrest warrant has been issued for Peng. Because Sampath lives in Texas, an extradition warrant has been issued for him. His company, Innive, currently holds government contracts throughout California and across the country.
Los Angeles County District Attorney Nathan J. Hochman said in a statement, “This case involves a blatant abuse of public trust — funneling taxpayer dollars intended for students into personal coffers. This vendor, working with an LAUSD project manager, allegedly carried out a multi-year, multi-contract pay-to-play arrangement that siphoned millions of dollars from our schools. We will not tolerate public officials who sell out their responsibilities or contractors who line their pockets by gaming the system. Both will be held fully accountable.”
If convicted on all charges, both Peng and Sampath could face up to seven years behind bars. Arraignment dates for both defendants will be scheduled at a later date.
According to Patch, prosecutors are asking anyone who has information about an organization that entered into contracts with Innive to contact the DA’s Public Integrity Division at 213-257-2475 or submit a tip through the online form at da.lacounty.gov/contact/email.
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