The Law Firm of Piacentile, Stefanowski & Malherbe LLP
Education Fraud

Education Fraud

Education fraud occurs when a school or university violates federally mandated standards or the Higher Education Act (HEA) to increase profits. Ruthless administrators cheat the system by enrolling more students or cutting costs. These schemes will eventually exert their burden on taxpayers as unqualified students whose grades were artificially inflated will fail to repay their loans. Blowing the whistle against this type of fraudulent practices help the government uncover those who prey on youths who want to receive an education to improve their lives.

How does Education Fraud works?

jar of money

Higher education has become a lucrative business for thousands of colleges and universities across the country. Most of these institutes rely on the $150 billion they receive in federally backed student loans and grants to stay in business, so they can keep driving up enrollment prices without worrying about attendance. However, many schools still turn to fraud to increase their bottom line. Anti‐kickback laws are violated by illegally paying recruiters commissions,  students grades are inflated to qualify for more grant money, and accreditation standards are failed to comply with in order to save on expenses. These education scams leave the future graduates with lackluster career prospects and overwhelming debt.

Unlike publicly funded state colleges or private nonprofit universities, for‐profit schools treat education as a business and try to maximize their profits by increasing enrollment while saving money on expenses like teacher salaries and extracurricular activities. High-pressure and deceptive sales tactics are often employed, such as misrepresenting the quality of their facilities and programs. A 2010 report by the Government Accountability Office found that almost all for‐profit institutions devised suspect and potentially fraudulent business practices. All forms of education fraud are prosecuted under the False Claims Act, which has its own provisions for whistleblower protection and rewards.

Harm Caused by Education Fraud

Schools that commit education fraud often have much lower graduation rates. The students who complete their studies often have difficulty finding a job that allows them to repay their loans, forcing the government and ultimately taxpayers to pay this price rather than the schools. The default rate among students who attend for­-profit schools is over triple than that of those who attend public or private nonprofit colleges. Ultimately, these young citizens are fed false promises by unscrupulous educational institutions and are the primary victims of this type of scheme.

Types of Education Fraud


Prominent Cases of Education Fraud


How to Report an Education Fraud

We can be young only one time during our lives. during that time we got a single chance to change our lives by receiving a better education. Ruthless institutions who use their despicable schemes to steal taxpayers’ money do so regardless of the consequences on our youths’ future. Those unfortunate enough to graduate with a lackluster education will often find themselves overwhelmed by debts since they’re unable to properly develop their careers. By helping us stop these criminals by blowing the whistle, you are actively contributing to build a better future for your own sons and daughters.

Contact us by filling out a form or calling toll-free at (800) 689-8552.


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