WACO, Texas – ELPSS Career Institute LLC, a career school located in Killeen, and its director, Ricky J. Daniels, Jr., were ordered in federal court in Waco on Wednesday, to pay $9,024,886.99 in damages and civil penalties to the United States under the False Claims Act for defrauding the Post-9/11 GI Bill.
The Post-9/11 GI Bill provides financial support to members of the military, veterans, and eligible dependents who enroll in certain education programs. A non-accredited career school such as ELPSS Career Institute must operate for at least two years before it may enroll students receiving Post-9/11 GI Bill benefits. This requirement is intended to limit the payment of veterans’ benefits to established courses offered at a reasonable cost by seasoned institutions.
In October 2020, the United States filed a complaint in the U.S. District Court for the Western District of Texas alleging that Daniels had falsely certified to the Department of Veterans Affairs (VA) and the Texas Veterans Commission (TVC) that ELPSS Career Institute had been in operation for more than two years in order to obtain approval to enroll Post-9/11 GI Bill students. The United States alleged that Daniels formed ELPSS Career Institute less than a year before applying for approval. According to the United States, Daniels provided student files from an unaffiliated school in El Paso to the TVC when it conducted a site visit to verify the school’s dates of operation.
Following discovery, the United States moved for summary judgment under the False Claims Act, which allows the government to recover three times the amount of funds fraudulently obtained plus a civil penalty for each false claim. A magistrate judge concluded that the undisputed evidence showed that Daniels knowingly made a false certification regarding ELPSS Career Institute’s compliance with the two-year requirement; that the false certification was material to the VA’s decision to allow ELPSS Career Institute to receive tuition reimbursement for veterans receiving Post-9/11 GI Bill benefits; and that the false certification caused the VA to disburse more than $2.3 million to the school. U.S. District Judge Alan D. Albright adopted the magistrate judge’s report and recommendation, granting the government’s motion and awarding it $9,024,886.99.
“Fraud on the Post-9/11 GI Bill threatens the integrity of education benefits provided to military veterans and their families,” said U.S. Attorney Jaime Esparza of the Western District of Texas. “This office is committed to holding accountable anyone who undermines the critical benefit programs that assist those who serve our country.”
“Safeguarding Post-9/11 GI Bill education benefit funds reserved for deserving veterans remains a priority,” said Acting Special Agent in Charge Patrick Roche of the Department of Veterans Affairs Office of Inspector General’s South Central Field Office. “This judgment is a testament to the VA OIG’s commitment to working with the United States Attorney’s Office to hold accountable anyone who would defraud VA’s benefits programs.”
The VA Office of Inspector General conducted the investigation. Assistant U.S. Attorney Thomas Parnham represented the United States in the lawsuit, which is captioned United States v. Daniels et al., Civil Action No. 6:20-CV-00986-ADA.
The claims resolved by the settlement are allegations only and there has been no determination of liability.