The operators of a defunct Florida chain of for-profit colleges have been hit with federal charges that accuse school operators of defrauding taxpayers.
FastTrain, which once operated on eight campuses spread across the state and taught technical courses in information technology, medical work, and other fields, was founded in 1999 and ceased operations in 2012 following a federal raid.
Now, two years later, officials say the school was little more than an elaborate tax scam, with employees encouraging students to make fraudulent applications for federal Pell grants and student loans.
As a result, four of its personnel could face years in prison. The criminal charges are in addition to an ongoing civil lawsuit by a former admissions employee for the school, who filed a whistleblower lawsuit alleging that the school sought to recruit as many students as possible in order to max out federal student aid.
The charges could be uncomfortable for some Florida politicians as well. Florida Democratic Rep. Alcee Hastings, a major supporter of for-profit colleges, once gave a commencement address at a Fast Train campus graduation ceremony, and had a scholarship offered by the school named after him.
The accusations are another black eye for the for-profit education industry, which has faced increasing state and federal government efforts to regulate its activities. The Florida indictment goes farther, however, in alleging not just civil liability but also criminal wrongdoing as well.
The list of alleged malfeasance by the school runs long, and includes claims of shoddy coursework, questionable charges for students and overly aggressive recruiting.
The key accusation from the federal government, however, is that FastTrain evaded federal requirements that recipients of federal aid have a high school diploma or GED before being allowed to enroll. The indictment details several spectacular instances of students allegedly being told a diploma was not necessary or that they could obtain one while attending the school. In one case, the school is alleged to have given a student a fake diploma from Cornerstone Christian Academy (a real Florida school) after taking a written test given by the school.
These students who lacked genuine diplomas were then encouraged to make fraudulent applications for student loans and Pell grants, which once granted went towards the school’s tuition. The indictment alleges that over a thousand such fraudulent applications were made, resulting in improper government loans and grants totaling over $5 million.
While the school’s legal troubles revolve around the government aid process, the school’s academics allegedly left much to be desired as well. A former student told the Miami Herald that the school’s classes were a sham, with outdated computer equipment being used to teach students skills that would not be enough to get them a job.
“It was just a bunch of nonsense,” he said, adding that school employees also lied to students that they wouldn’t have to take out student loans to attend.
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