Former Testquest Manager Pleads Guilty To Defrauding Federal Government By Falsely Claiming To Have Provided Tutoring Services That Were Paid For With Federal Funds

Preet Bharara, the United States Attorney for the Southern District of New York, announced today that MICHAEL LOGAN, a former manager of TESTQUEST, INC. (“TESTQUEST”), an educational services company that provided tutoring services to public school children as part of a federally funded program, pled guilty in Manhattan federal court for his role in a scheme to defraud the federal government by falsely submitting claims for payment for tutoring services that were never actually provided. LOGAN pled guilty before U.S. District Judge John F. Keenan.

Manhattan U.S. Attorney Preet Bharara said: “The federal government devotes important resources to a program intended to benefit students in need, and not intended to be manipulated by people like Michael Logan for their own benefit. To make matters worse, rather than focusing on the instruction of children, Logan focused on instructing witnesses to lie. With his guilty plea today, he will now face the consequences of his shameful exploitation of this vitally important program.”

According to the Criminal Complaint and Criminal Information filed against LOGAN, and a Civil Complaint that was filed against TESTQUEST and LOGAN earlier this year:

Each year during the time period at issue, 2005 through 2012, the New York City Department of Education (“NYCDOE”) received funds from the federal government to pay for New York City’s Supplemental Educational Services program (“SES”), which included after-school tutoring and other remedial and supplemental academic enrichment services for students attending underperforming public schools. NYCDOE entered into contracts with private entities and organizations to provide SES tutoring to public school students. Students were eligible to receive SES tutoring if they met certain criteria, such as attending a school that had been identified as needing improvement or restructuring for at least two years. Private entities contracted by NYCDOE to provide SES tutoring were required to have each student who attended a class sign a standard attendance form. The tutor was also required to sign the form, attesting to the fact that he or she provided SES tutoring to those students. Further, as a condition of getting paid for providing tutoring, the private entities were required to certify to the NYCDOE that their attendance records were “true and accurate.”

From 2005 through 2012, TESTQUEST contracted with the NYCDOE to provide SES tutoring. It provided individual tutoring to students at their homes and group tutoring at various New York City public schools, including the Monroe Academy of Business and Law/High School of World Cultures (“Monroe”) and the Global Enterprise Academy/Christopher Columbus High School (“Columbus”). TESTQUEST received tens of millions of dollars in federal funding for tutoring during this time period, including more than $2.3 million for purported tutoring at Monroe and Columbus alone.

MICHAEL LOGAN was an employee of TESTQUEST responsible for managing its SES tutoring program at Monroe and later at Columbus. LOGAN also worked as a long-term substitute teacher and computer technician at Monroe and sometimes coached its baseball team. LOGAN instructed TESTQUEST employees to forge student signatures on attendance forms and to have students sign attendance forms for tutoring classes they had not attended. On some occasions, LOGAN caused TESTQUEST employees to fraudulently obtain students’ signatures by collecting them from students assembled in the school cafeteria or participating in afterschool activities such as baseball or basketball practice. For example, LOGAN would direct employees to participate in this fraud by saying, “if you can’t find the students, sign them in,” and “make them sign or you won’t get paid.” Further, when LOGAN learned of the criminal investigation, he coached others to lie. In one recorded conversation, LOGAN encouraged another witness to lie about teaching classes that occurred when he and the witness were actually coaching after-school sports. As a result of LOGAN’s conduct, TESTQUEST employees repeatedly submitted bills to NYCDOE for tutoring that never occurred and for which TESTQUEST was paid substantial sums of money.

LOGAN, 48, of White Plains, New York, pled guilty to one count of conspiracy to defraud the United States and the U.S. Department of Education. He faces a maximum sentence of five years in prison, and is scheduled to be sentenced by Judge Keenan on October 9, 2013. The charges in the Civil Complaint against LOGAN and TESTQUEST remain pending.

Mr. Bharara thanked the U.S. Department of Education’s Office of Inspector General for its extraordinary assistance in this case.

The case is being handled by the Complex Frauds Unit. Assistant U.S. Attorneys Joseph P. Facciponti and Christopher B. Harwood are in charge of the prosecution.

U.S. v. Michael Logan Information