In the 19 months since he arrived at Heartland Christian Academy, a boot camp for troubled teens in northeastern Missouri, Matt Smith has been paddled more than 300 times—sometimes for infractions as minor as looking at a girl or passing a note. Last September, when he refused to stand with his nose pressed against a fire extinguisher as a punishment for being loud, a staffer broke his arm by twisting it behind the 14-year-old’s back. Not surprisingly, Smith says he would like to leave Heartland. “They take the Bible and turn it into punishment,” he says. “I hate this place.”

However much he hates it, though, Smith isn’t going anywhere. With a juvenile record of assault, he was sent to the sprawling campus 150 miles north of St. Louis by court order, and with the blessing of his custodial grandmother, in February 2005 and placed in the care of Charles Sharpe, a millionaire insurance tycoon turned preacher. Sharpe, who has poured more than $50 million of his own money into building Heartland, enforces an educational philosophy heavy on discipline for 104 troubled students, mostly from the Midwest, who range in age from 5 to 17: daily Bible study, strict rules and corporal punishment with a 2½-ft. wooden paddle. “The only thing these kids understand is pain,” says Sharpe, 79. “We’ve created a society where the kids are in charge, and it’s causing a complete breakdown.” Adds his wife, Laurie, 47, who runs the girls’ dormitory: “Swatting [paddling] is biblical. You have to teach a child to live right.”

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Boot camps for problem kids are nothing new in this country, but Heartland, with its emphasis on religion, is one of about a dozen last-resort schools that have flourished in Missouri, where the state’s interpretation of freedom of religion permits such faith-based facilities to go unregulated. “We don’t monitor, we don’t supervise, and their discipline policies are not regulated by state authorities,” says Jim Morris, spokesman for the Missouri Department of Education. “We tell parents to ask a lot of questions.”

Most mainstream child-development experts criticize boot camp techniques—separating kids from their families, subjecting them to humiliation—as ineffective, even harmful. “These programs create in parents a sense of crisis. If you don’t act, your child will end up in jail or dead on the streets,” says critic Dr. Robert Friedman, a clinical psychologist at the University of South Florida and an expert on teen mental health issues. According to Maia Szalavitz, author of a new book about boot camps, Help at Any Cost, the heavy use of punishment doesn’t necessarily build strong character. “The idea that you need to break people to fix them may produce compliance, but that’s all,” she says.

Heartland, in particular, has been accused of taking discipline too far. After multiple reports of abuse, including a student whose eardrum was punctured during an altercation with a junior staffer, a dozen deputy sheriffs and juvenile officers raided the campus in 2001, removing 115 students. Although charges were eventually dropped and the majority of the students have returned—and been joined by recent arrivals—law enforcement has kept an eye on the facility. “He’s not an educator, not a child expert, not even an ordained minister,” says Lewis County prosecutor Jake DeCoster of Sharpe. Sharpe’s take is even harsher. In a 2002 sermon, he called DeCoster “a pawn of Satan.” (As for Matt Smith’s broken arm, the sheriff determined it was not an assault.)

Sharpe’s students pay no fees in return for a commitment to stay until graduation, but if they leave early they are billed for back tuition of $600 a month. “I wanted my kids to get through these years without a criminal record and without getting pregnant,” says Sheri Farley, 48, who sent three of her six children to Heartland when they became violent and sexually active during adolescence. One recently graduated; two still remain at the facility. “I don’t agree with everything they do, but my kids were totally out of control.”

Founded in 1995, Heartland grew from a promise that Sharpe, the son of poor farmers from Newark, Mo., made to God after his second wife began suffering from anxiety attacks. “The Lord spoke to me. He said, ‘Build this place or your wife won’t make it,'” he says. Sharpe, who had long been contemplating creating a school with the profits from his insurance company, Ozark National Life Insurance, designed a program where every minute of a student’s day is choreographed: Wake-up is at 5:30 a.m., followed by daily Bible study, classroom instruction and evening church services. Students have chores ranging from pulling weeds to scrubbing toilets. Lights out in the sex-segregated dorms is at 8:30 p.m.

Seventeen-year-old Sam Calicotte from Hannibal, Mo., was smoking pot and cigarettes when her mother sent her to Heartland. She didn’t like it at first, but now Calicotte happily mops floors and talks of going to Bible college one day. “I’ve learned to finish what I start,” she says. “There’s a lot of rules to keep you in line.” And punishment for breaking them. Isolation, food deprivation and hours of extra chores are common. Girls who misbehave are forced to wear a grannyish “ugly dress”; unruly boys put on a bow tie and a suit. Teens who run away or self-mutilate must wear an orange jumpsuit for at least a month and, most days, several students are paddled. Some punishment techniques have been dropped in recent years, including digging graves to “bury an attitude” and eating “Heartland stew,” a mixture of table scraps and leftovers.

Over the years, child welfare authorities have intervened at Heartland, which shares a sprawling campus with a Bible college for non-delinquent adults. During the 2001 raid, investigators learned student Josh O’Rourke, then 16, was paddled more than 50 times the previous year and forced to sit in a metal chair overnight. His father, Jim, who lived at Heartland and participated in the beating, had accused his son of stealing $100. (Jim O’Rourke ultimately pleaded guilty to child abuse.) At the same time, five staffers were arrested for forcing 11 teenagers to wade into concrete-lined pits of manure up to chest height.

Jurors decided the manure case did not meet the definition of child abuse in Missouri. And Sharpe makes no apologies. “The kids said, ‘We don’t want to go to school.’ Okay, we’ll show you what life is like without schooling,” he says. “The next day, they decided school wasn’t so bad.” Although no charges are currently pending against Heartland, a registered sex offender—one of seven who work at the facility—pleaded guilty four months ago to charges of making lewd comments to a 14-year-old girl. Sharpe responds that he does not turn his back on anyone: “Our job is to take care of people that are messed up.”

Heartland’s legal problems may not be over yet. Mark Stajduhar, now 20 and married, told PEOPLE that four months after arriving at Heartland in 1999, he was sexually assaulted in the dormitory by a male student supervisor. The abuse, he says, continued for months. “He was bigger than me,” says Stajduhar, now a freshman at Culver-Stockton College in Canton, Mo. “If I told someone, I knew I’d get accused of being a homosexual.” Stajduhar filed a report with the local sheriff’s department in 2003, and a criminal investigation, the sheriff says, is ongoing. Stajduhar has also hired a lawyer and filed a class action suit against Heartland that was served last November. “I’m not saying it’s impossible but I don’t know about it,” says Rob Patchin, Sharpe’s grandson and the boy’s dorm supervisor, of Stajduhar’s claims. “And I’m sticking to that.'”