A doctor and his wife accused in a college admissions bribery scheme face an additional felony charge, conspiracy to commit money laundering, according to a new indictment released by a federal grand jury on Tuesday.

Palo Alto residents Amy Colburn, 59, and Dr. Gregory Colburn, 61, are now accused of two felonies for their part in a nationwide scam to fraudulently snag coveted spots at major universities involving at least 50 people. The money-laundering accusation is in addition to a previous charge of conspiracy to commit mail and wire fraud and honest services mail and wire fraud, which federal prosecutors filed earlier in March.

The Colburns are among 33 wealthy parents who allegedly paid off a cabal that included a college-admissions coach, a test proctor, university athletics coaches and admissions officers to get their children into top universities, including Yale, Stanford and the University of Southern California, according to federal prosecutors. Scam ringleader William "Rick" Singer told clients that he could get their children into the highly competitive colleges through a "side door" and the bribes were a routine way to game the system.

The scheme allegedly faked college-admissions test scores and produced fraudulent athletics profiles to facilitate acceptance into coveted colleges in exchange for money and stocks. As much as $25 million exchanged hands, according to the U.S. Attorney's Office in Massachusetts, which filed the indictments.

Ten of the parents have connections to Palo Alto, Menlo Park, Atherton and surrounding cities, including the Colburns. The latest charge against the couple stems from a wiretap made by federal authorities in October 2018. The recording captured the couple allegedly agreeing to support lies told to the Internal Revenue Service by Singer. He told IRS investigators that $25,000 in bribes and other payments the Colburns made and funneled through his charitable organization were for donations to the Key Worldwide Foundation and would benefit needy children to have better educational opportunities.

For his part, Gregory Colburn allegedly transferred $24,443.50 in stock to the foundation to facilitate the cheating scheme for his son in December 2017. The foundation then issued a letter to Colburn falsely indicating that "no goods or services were exchanged" for his $25,000 donation. Colburn issued a check to the foundation for $547.45 on Dec. 30 and wrote "charitable donation" in the memo, according to the indictment.

On Oct. 24, 2018, Singer called the Colburns from Boston, Massachusetts. He told Amy Colburn the Internal Revenue Service had asked him about the payments for her son's March 10, 2018 SAT test in southern California at the West Hollywood Test Center, where Singer sent his clients' children to cheat on the college-admissions tests.

"OK, is that a problem?" Amy Colburn allegedly replied.

Singer said that he was not going to mention to the IRS that Mark Riddell, a Florida man Singer had brought in to "proctor" the exams, had taken the test for their son.

"Mmm-hmmm," Amy Colburn allegedly said.

Singer said he told the IRS that her payment "went to the foundation to help underserved kids."

"OK," Amy Colburn responded.

Singer also spoke to Gregory Colburn during that same phone call. He said that he was not telling the IRS that Riddell took the test for his son at the West Hollywood Test Center.

"And just in case they were to call you, I just wanted to -- because I've already told them that, you know, this -- essentially this payment was made to our foundation in lieu of, but we both know that, Mark took the test for (your son). But I just wanted to make sure that we don't -- we're all on the same page," Singer said.

Gregory Colburn allegedly replied, "Right. It was to help underserved kids ... Got it. No problem."

Riddell and Igor Dvorskiy, owner of the West Hollywood center where students took the tests, each received $20,000 each from Singer for their work regarding the tests for the Colburns' child and another student who took the exam at the same time.

The Colburns' son's score was 1190 out of a possible 1600, which was submitted as part of his college applications in November 2018 to Texas Christian University, Indiana University Bloomington, the University of Oregon and the University of Arizona.

The Colburns are being represented by attorneys David Schumacher and Patric Hooper of the Boston law firm Hooper, Lundy & Bookman PC. In a statement, the attorneys said the Colburns completely deny the allegations in the indictment.

"The Colburns' son took his SAT test with no assistance, and the couple were unaware that his test was altered in any way," the attorneys said.

"These types of heavy-handed tactics have resulted in widespread criticism against the DOJ in Boston and nationally. The government has cast its net too widely in this investigation. The Colburns have done nothing wrong and are shocked by the indictment out of Boston, where they have no ties. They will seek a speedy trial to clear their names through their counsel," the attorneys said.

Since the indictment, the Colburns' lives have been turned upside down, their attorneys said. They were arrested at their home in front of their children. The Colburns ask that members of the public respect their privacy and especially the privacy of their son, the statement said.

Gregory Colburn, a radiation oncologist, will be taking a leave of absence from his work so he can devote his full attention to defending his wife and himself against the charges, the attorneys said.

The Colburns' initial appearance in federal court in Boston was scheduled for this Friday, March 29, but that date has been canceled, according to the U.S. Attorney's Office. A new date for an appearance hasn't been scheduled by the court.

A conviction on each charge carries a maximum sentence of 20 years in prison and three years of supervised release, in addition to hundreds of thousands of dollars in fines associated with the scheme.

Related content:

• Listen to the March 15 episode of "Behind the Headlines," where Palo Alto college adviser John Raftrey discusses the implications of the nationwide admissions bribery scandal, now available on our YouTube channel and podcast.

• Feds: Parents paid tens of thousands to game the admissions system

• William 'Rick' Singer, head of college-admissions scam, had many Palo Alto connections

• Pressure over college admissions 'out of control'

• Stanford students file class action lawsuit in admissions scandal

• Ex-global equity firm exec, a grad of Gunn High, implicated in admissions scam

• Opinion: Making the college-admissions system more equitable

• Opinion: Lessons parents should learn from the college-admissions scandal

• Editorial: The audacity of privilege

• In response to college-admissions scandal, Stanford to probe policies, current athletic recruits

• $75K for a fake ACT score? Students say cheating happens without the big bucks

• Following college-admissions indictments, feds investigate whether Stanford was lax in complying with financial-aid laws