Every year, federal, state, and local governments spend billions of dollars on education. These funds are used to provide financial aid to college students, support primary and secondary schools, assist students with disabilities, and fund research at colleges and universities nationwide.

Unfortunately, this spending is also a target for fraud and abuse.

Under the False Claims Act (FCA), whistleblowers can file claims on behalf of the government to report fraud and misconduct related to government contracts. If successful, the whistleblower receives shares as a percentage of the recovery.

Types of Fraud in Education

Fraud in education can take many forms, including fraud on applications for financial aid, fraudulent recruitment of prospective students, falsifying grant applications, misuse of research funds, or misappropriation of educational spending. Each of these forms of fraud in education violates state and federal laws and threatens the integrity of the education system.

Federal Student Aid Fraud

Federal student aid fraud occurs when someone provides false or misleading information to help an individual obtain financial aid they are not entitled to receive. Examples of federal student aid fraud include paying kickbacks to student recruiters, recruitment techniques that violate the Department of Education’s ban on incentive compensation, helping ineligible students obtain financial aid, and misrepresenting graduation, job placement, or other standards of academic quality.

Student Recruitment Fraud

Education fraud also occurs in the recruitment of prospective students. Under federal and state laws, institutions of higher learning are prohibited from paying recruiters for signing up new students. Nonetheless, in the competition for higher enrollment, some schools simply disregard this ban.

Grant and Research Fraud

Grant and research fraud can take many forms, such as:

• Lying on a grant application
• Misrepresenting grant-funded activities or research results
• Embezzling or misappropriating grant funds
• Obtaining the grant under false pretenses

Fraud in Education Spending

State and local governments devote substantial resources to education programs, and they are not immune from fraud. Examples of education fraud at the state and local levels include:

• Charter schools inflating attendance and learning hours to obtain additional reimbursements
• Admitting unqualified students into programs for students with disabilities
• Charging public education purchasers excessive fees for goods or services
• Paying bribes or kickbacks to secure contracts
• Embezzling public funds

Do I Need a Whistleblower Attorney to Bring a Legal Claim for Fraud in Education?

The False Claims Act requires that whistleblowers be represented by an attorney to file a qui tam action on behalf of the government. These lawsuits are filed in the name of the United States, and individuals cannot represent the government without an attorney.

Bringing a legal action under the False Claims Act is unlike a typical lawsuit. These claims are often highly technical and involve sealed filings, government investigations, and coordination with the Department of Justice (DOJ).

Blowing the Whistle on Fraud in Education

Blowing the whistle on fraud in education is critical to stopping and correcting unethical and illegal practices. If you witnessed fraud, waste, or abuse in government funds for education, contact the whistleblower attorneys at Madsen, Prestley, & Parenteau today. Our attorneys can help you navigate this complex area of the law, interface with government investigators, and provide you with the legal protection you deserve.