::cheers:: Let's post it before it slips into the archives
Former Wellspring Academy head given 30 months in prison
By Mike Gangloff
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School's founder guilty of fraud
Robert Serge Gluhareff, who headed the financially troubled Wellspring Academy in Halifax County, will spend 30 months in prison for a variety of fraud charges.
Gluhareff, who in April pleaded guilty to two federal charges linked to bank fraud, one to mail fraud and one to tax fraud, led a high-priced school for troubled boys that touted the Christian framework of its program. Prosecutors said he propped up the school's shaky finances by depositing bad checks or tuition checks that he knew parents could not yet cover. He also encouraged parents to label advance tuition payments as scholarship donations and to claim tax deductions for them, prosecutors said.
When the school closed suddenly in 2003, parents who paid in advance were out thousands of dollars.
Today, U.S. District Judge Samuel Wilson sentenced Gluhareff to 30 months in prison on each of the four charges, to be served concurrently. Gluhareff also was ordered to pay more than $500,000 restitution, although both defense and prosecution agreed that it’s unlikely he’ll be able to repay that much.
School's founder guilty of fraud
The former head of Wellspring Academy in Sutherlin pleaded guilty to four counts of fraud in the school's closing.
Mike Gangloff
Legal fallout from the collapse three years ago of a pricey Christian school for troubled youth in Halifax County continued Monday with guilty pleas in U.S. District Court.
Robert Serge Gluhareff, the 62-year-old founder and former head of Wellspring Academy in Sutherlin, pleaded guilty to four counts of fraud -- two related to bank fraud, and one each to tax and mail fraud. Those charges, and 49 more dismissed under a plea agreement, stemmed from what prosecutors described as the South Boston resident's attempts to stave off his school's financial collapse and preserve his family's livelihood.
The school's abrupt closing in 2003 left parents who had paid tuition in advance out thousands of dollars.
Contacted by telephone after the court hearing, Ted Mitchell of Youngsville, N.C., said he doubted he'd get back the more than $30,000 he'd borrowed to pay for his son to attend Wellspring.
"He has ruined my life, my wife's life, my son's life," Mitchell said of Gluhareff.
The plea agreement set a sentencing range of 27 to 33 months in prison followed by three years of supervised release. Details of restitution are to be set at sentencing, which is scheduled for July 16.
Wellspring was set up in the late 1980s as a Christian residential program for children with behavioral and academic problems. By 1997, it had become a boys-only facility, and in its final years, about 60 to 100 boys attended at any time. Annual tuition ranged from $43,000 to $49,000.
Gluhareff's wife, two sons and their wife and girlfriend were on Wellspring's payroll during its last years.
Prosecutors said that between 1999 and 2003 Gluhareff temporarily inflated the balances of Wellspring's bank account by depositing bad checks written on his personal accounts and by depositing parents' tuition checks when he knew they had not yet acquired loans to cover them.
Gluhareff or his staff, at his direction, also told parents they could claim advance tuition payments as tax deductions by calling them scholarship donations, and gave them misleading letters to help claim the improper deductions, prosecutors said.
Jay Darden, a U.S. Department of Justice trial attorney who presented the government's evidence, said the bogus deductions cost the government $405,051 in taxes. After the court session, U.S. attorney's office spokeswoman Heidi Coy said she did not know how the improper deductions were being handled.
In newspaper accounts at the time of the school's shutdown, Gluhareff blamed procedural errors and a disgruntled employee for problems.
June Speaker, the parent of another Wellspring student, said Monday after Gluhareff's plea that she initially chose the school because it billed itself as a Christian program. Later, though, she wanted to bring her son back to their home near Chicago because of what she described as harsh discipline and because she wasn't allowed to talk to her son for more than two months.
When she got a call on Easter weekend 2003 that the school was closing and she needed to retrieve her son, it was the answer to her prayers, Speaker said.
Staff researcher Belinda Harris contributed to this report.
