Indictment says a contractor's scheme took $20M and killed a community college

On 8 October 2026, an Ohio special grand jury indicted former Eastern Gateway Community College president Michael Geoghegan and Michael Perik and Nicole Rowe Colclasure — cofounders of the Student Resource Center (SRC), a private contractor — on charges including aggravated theft in office, tampering with records, money laundering, bribery and having an unlawful interest in a public contract. The 23-page indictment alleges the scheme "stole more than $20 million" from the college, the federal government, students and the state over five years from 2017.

The alleged mechanics: SRC posed as an independent contractor while controlled by Perik and Colclasure. A consultant hired as interim financial aid officer found a $3.6 million overpayment and began correcting it; the indictment says Geoghegan told him the college "had already spent the money" and could not repay, then fired him when he refused to stop. SRC employee Luis Rosa, paid about $80,000 while serving as EGCC's acting financial aid director in 2018 without being a college employee, allegedly disbursed over $1.5 million to ineligible students.

The fallout: Eastern Gateway collapsed and closed, leaving a multi-county region of eastern Ohio without a community college. Auditor of State Keith Faber said Ohio put in more than $15 million of subsidy advances and emergency funds, thousands of students faced transfers and risks to Pell grant eligibility, and the federal liability exceeds $44.4 million. The college's ballooning online enrollment also siphoned state subsidy dollars away from other Ohio community colleges.

More than $20M allegedly stolen; the college closed, leaving a 'higher education desert'; $15M in state emergency funds; a $44.4M federal liability.

The enterprise's stated purpose, per the indictment, was to capture as much federal aid and state subsidy as possible for the contractors' entities.

The 'independent contractor' facade let SRC place its own paid staff inside the college's financial aid office with system access.

Complaints were neutralised: the consultant who found the $3.6 million overpayment was fired for refusing to stop correcting data.

Bribery of top financial aid and admissions officers, prosecutors allege, kept the scheme hidden from regulators and auditors.

When a college's core function — financial aid — is outsourced to a contractor its own president steers work to, no audit trail inside the college will save it.

All three face charges including aggravated theft, money laundering and bribery; the case is at the indictment stage and the allegations are unproven. The college is closed, and US Undersecretary of Education Nicholas Kent called the indictment an important moment in the fight against fraud in higher education.