Innovative Educational Programs, LLC (Innovative), an educational services provider, has agreed to pay the United States $1,185,000 to resolve civil allegations that it fraudulently billed the United States for tutoring services for underprivileged New York City students that it never actually provided.
Seth D. DuCharme, Acting United States Attorney for the Eastern District of New York, and Terry Harris, Special Agent-in-Charge, U.S. Department of Education, Office of Inspector General, Eastern Regional Office (DOE-OIG), announced the settlement.
“This settlement should put providers of educational services on notice that this Office will aggressively protect federal programs meant to help disadvantaged students and will hold accountable those who exploit and manipulate such programs,” stated Acting United States Attorney DuCharme.
“The Office of Inspector General has a unique and special law enforcement mission – to protect public education funds for eligible students. Today’s settlement is a result of the hard work and effort of OIG special agents and staff,” stated DOE-OIG Special Agent-in-Charge Harris. “I'm proud of their efforts, as well as those of our law enforcement partners and the U.S. Attorney’s Office whose actions today corroborates the importance of maintaining the integrity of Federal education programs and the taxpayer funds that support them.”
The settlement resolves allegations that, between 2009 and 2012, Innovative, a New Jersey limited liability corporation, fraudulently obtained federal funds for purportedly providing after-school tutoring services to underprivileged students attending underperforming New York City public schools. The New York City Department of Education paid Innovative $72.80 per hour for each student that Innovative tutored. This money consisted entirely of funds made available to New York State by the United States under the Elementary and Secondary Education Act of 1965, as amended by the No Child Left Behind Act of 2001. As a condition for receiving payment for its tutoring services, Innovative was required to certify that its attendance records were true and accurate. The government’s investigation revealed that Innovative billed the government for allegedly providing after-school tutoring services to students on days when the students were, in reality, absent from school.
The allegations were brought to the government’s attention through the filing of a complaint pursuant to the qui tam provisions of the False Claims Act (the Act). Under the Act, private citizens can bring suit on behalf of the United States and share in any recovery. The Act also permits the government to intervene in such actions, as the government has done in this case.
The claims resolved by the settlement are allegations only and there has been no finding of liability by a court. Innovative has expressly denied these allegations and any liability under the Act.
The United States’ case was handled by Assistant U.S. Attorney James R. Cho of the Office’s Civil Division, with assistance from Affirmative Civil Enforcement Paralegal Loan Nguyen.
E.D.N.Y. Docket No. 12-CV-094 (FB)