Michael Perik, a Jamestown, Rhode Island businessman and the husband of Rhode Island Democratic Party Chair Liz Beretta-Perik, faces a dozen felony charges in a sweeping Ohio indictment accusing him and two others of orchestrating a coordinated scheme that diverted roughly $20 million in federal financial aid, Pell Grants, and state subsidies from Eastern Gateway Community College before the institution collapsed.
Ohio Auditor of State Keith Faber announced the indictments on October 8, 2026, following a multi-year investigation by his Special Investigations Unit.
A Jefferson County grand jury returned a 24-count indictment charging Perik and co-defendant Nicole Rowe Colclasure with engaging in a pattern of corrupt activities (racketeering), aggravated theft of $1.5 million or more, theft in office, telecommunications fraud, bribery, having an unlawful interest in a public contract, receiving stolen property, and money laundering.
Former Eastern Gateway president and chief financial officer Michael Geoghegan faces nine related felony counts. Court appearances were scheduled for October 19.
According to the Ohio Auditor’s office, Perik allegedly used four for-profit entities he controlled, including the Student Resource Center, to improperly divert funds through fraudulent reimbursements and illegal incentive compensation.
Federal law bars incentive payments tied to enrollment and financial aid activities unless handled by a truly independent third party.
Investigators allege the companies did not operate independently; instead, they exercised significant control over enrollment, attendance verification, financial aid access, and other core functions.
Aid was allegedly disbursed for ineligible students, and proper checks on attendance or withdrawals were ignored. Millions flowed to the Perik-controlled entities.
According to the Ohio Auditor of State:
“The Jefferson County Grand Jury has handed down indictments against three individuals in the alleged theft of about $20 million from the now-defunct Eastern Gateway Community College (EGCC), Auditor of State Keith Faber announced.
The racketeering case against Michael Perik, Nicole Rowe Colclasure and Michael Geoghegan alleges a coordinated criminal scheme that diverted Pell grants and other federal financial aid and state subsidies through fraudulent reimbursements and illegal incentive payments, ultimately contributing to the closure of one of the region’s only higher education options.
“These public resources were supposed to help disadvantaged students in an area of the state where educational opportunities were scarce,” Auditor Faber said. “Instead, it appears these individuals took advantage of their positions, and students were left out in the cold.”
Perik and Colclasure each face a dozen felony counts, including engaging in a pattern of corrupt activities, aggravated theft of $1.5 million or more, theft in office, telecommunications fraud, bribery, having an unlawful interest in a public contract, receiving stolen property, and money laundering.
Geoghegan faces nine felony counts, including engaging in a pattern of corrupt activities, aggravated theft of $1.5 million or more, theft in office, telecommunications fraud, bribery, and having an unlawful interest in a public contract.
The indictment was filed in Jefferson County Common Pleas Court on Thursday. Attorneys from the Auditor of State’s Special Investigations Unit (SIU) were appointed by Jefferson County Prosecutor Jane Hanlin to serve as special prosecutors in the case.
Auditor Faber announced the indictments Thursday during a press conference at the Ohio Statehouse alongside U.S. Under Secretary of Education Nicholas Kent.
“Since day one, President Trump and Secretary McMahon have tackled fraud, waste, and abuse, which requires a whole-of-government approach,” Under Secretary Kent said. “It is a disgrace that individuals may have taken advantage of the federal student aid programs that are intended to help students access postsecondary education. We are proud to stand with Ohio Auditor Faber and his team to hold fraudsters accountable and protect the integrity of critical resources that millions of students and families rely on.”
EGCC was founded in 1968 in Steubenville, originally as the Jefferson County Technical Institute. Before closing for good in September 2025, it offered more than 70 associate degrees and majors and numerous certificate programs. Enrollees included families of steelworkers and high school graduates who could not afford to relocate to other campuses and workers who needed retraining as area factories closed.
SIU launched an investigation into EGCC, initially after receiving information about questionable purchasing by college officials. SIU, along with the Jefferson County Sheriff’s Office, the Ohio State High Patrol’s Computer Crimes Unit, the U.S. Secret Service, the Columbus Division of Police’s Digital Forensics Unit, and the Ohio Narcotics Intelligence Center executed a search warrant in January 2024 at EGCC as part of its ongoing investigation.
Thursday’s indictment alleges that Perik used four separate for-profit entities he owned, including the Student Resource Center, to divert funds from EGCC, illegally receiving incentive payments and other compensation in violation of federal and state laws. Colclasure was president and part owner of the Student Resource Center, among other roles in Perik’s companies. Geoghegan was chief financial officer and president of EGCC.
Federal law prohibits the payment of incentive compensation to individuals and entities that engage in activities related to colleges’ enrollment and financial aid, unless operated by an independent third party.
The indictment alleges the companies did not operate as independent third-party contractors, as required, but instead exercised significant and improper influence over EGCC. They controlled attendance verification, enrollment, fees, access to financial aid, and other critical functions at the college.
The illegal activities included disbursing aid for ineligible students and failing to confirm whether students actually attended or had withdrawn from classes. As a result, millions of dollars in financial aid were improperly paid to entities owned and controlled by Perik and Colclasure.
The indictment alleges Geoghegan knew about the scheme but still approved the disbursements.
Among other activities, entities controlled by Perik, Colclasure, and others were contracted to expand academic and degree programs, including online coursework offered through EGCC.
Between 2017 and March 2022, when the alleged crimes took place, enrollment at the college increased from about 8,500 students to more than 60,000, with more than 90% of students enrolled only in online courses, and about 80% reportedly lived out of state. Many of the latter participated in a “Free College Benefit Program,” through which union members and their family members and friends enrolled in EGCC classes at no direct cost to them.
In its final program review of EGCC, the U.S. Department of Education found that the college improperly used Pell grants and other financial aid to cover the costs for eligible and ineligible students. Federal officials identified more than $44.4 million in resulting liabilities that should have been repaid, though their final review projected liabilities of more than $259 million due to EGCC’s closure and its failure to provide required enrollment documentation and other records.
The final review also identified serious compliance issues within EGCC’s administration of federal aid programs, including the college abdicating core financial aid and operation responsibilities to third-party servicers. The issues impacted students, strained taxpayer resources, contributed to the college’s closure, and affected the broader community.
The most recent audit released by the Auditor of State’s Office, in November 2025, identified more than $17 million in questioned costs and rampant financial mismanagement by the college’s administrators.”
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