CALDWELL, NJ — Caldwell University has agreed to pay the United States more than $4.8 million to resolve allegations that it engaged in a fraudulent scheme to defraud a federal education benefit program, U.S. Attorney Craig Carpenito announced Jan. 3.
“Caldwell University tried to hoodwink the Department of Veterans Affairs and, worse, veterans themselves, by claiming to offer online classes developed and provided by Caldwell that were in fact marked-up offerings by an online correspondence school,” Carpenito said. “Our veterans should never be treated this way, and we will continue to work to ensure that they receive all of the benefits that they deserve as a result of their service to the country.”
“Caldwell University’s civil settlement, along with the previous criminal convictions, sends a clear message to other educational institutions that VA OIG is dedicated to holding those accountable who would take advantage of VA programs that are intended to assist veterans and their families,” said Jeffrey Stachowiak, acting special agent in charge of the U.S. Department of Veterans Affairs Office of Inspector General. “Our veterans sacrificed to serve our country and they deserve to receive the full education benefits that they earned through their military service. VA OIG is committed to working closely with our fellow law enforcement partners and thanks the U.S. Attorney’s Office, District of New Jersey, for its dedication to this investigation.”
According to the settlement agreement, from Jan. 1, 2011, through Aug. 8, 2013, Caldwell University submitted false claims for payment to the Department of Veterans Affairs in order to receive education benefits and funds pursuant to the Post-9/11 Veterans Education Assistance Act to which it was not entitled. The Post 9/11 GI bill was designed specifically to help veterans who served in the armed forces following the terrorist attacks on Sept. 11, 2001.
Three individuals previously pleaded guilty to separate informations charging them with one count of conspiracy to commit wire fraud related to this scheme to defraud the VA. Lisa DiBisceglie, the university’s former associate dean of the Office of External Partnership; David Alvey, founder and president of Ed4Mil LLC; and Helen Sechrist, a former employee of Ed4Mil, admitted their respective roles in the conspiracy to fraudulently obtain millions of dollars in tuition assistance and other education-related benefits from the Post-9/11 GI Bill. In 2018, Alvey was sentenced to five years in prison, and DiBisceglie and Sechrist were each sentenced to three years of probation. All three defendants were also ordered to pay $24 million in restitution.
According to documents in this case and statements made in court, Caldwell contracted with Ed4Mil to recruit and enroll eligible military veterans in non-degree fully online classes that were purportedly provided by Caldwell. DiBisceglie helped get approval from Caldwell’s administration to develop and administer a series of non-credit online courses for veterans in Caldwell’s name. In order for the courses to be eligible for education benefits under the Post-9/11 GI Bill, DiBisceglie, Alvey and others prepared and submitted an application to the VA stating that the courses were developed, taught and administered by Caldwell faculty and met Caldwell’s stringent educational standards; the VA then approved the online courses for education benefits.
However, Caldwell did not participate in developing or teaching the online courses. The courses were developed, taught and administered by a subcontractor of Ed4Mil, an online correspondence school in Pennsylvania that was not approved to receive education benefits under the Post-9/11 GI Bill.
Thousands of veterans were ultimately enrolled in the unapproved online correspondence courses without their knowledge while Caldwell and Ed4Mil profited. Even though Caldwell contributed no content or value to the courses, Caldwell charged the Post 9/11 GI Bill 10 to 30 times the prices charged by the online correspondence school for the same courses. As a result, the government paid more than $24 million in tuition benefits to the university.
The claims settled by this agreement are allegations only, and there has been no admissions of liability.