Veterans victimized in $24M education scam, authorities say

A $24 million “bait and switch” college education scam -- targeting U.S. military veterans -- could send two women to prison.

Court documents released Tuesday in Newark, N.J., described a scheme in which thousands of veterans using their Post-9/11 G.I. Bill tuition benefits thought they had signed up for courses at Caldwell University, a small Catholic college in New Jersey.

But instead, the veterans were enrolled in low-cost correspondence courses marketed by a Pennsylvania company – courses that were not covered by the Post-9/11 G.I. Bill.

Authorities in New Jersey said two women have pleaded guilty to one count each of wired fraud in connection with the scam: Lisa DiBisceglie, 56, of Lavallette, N.J., a former associate dean at Caldwell University; and Helen Sechrist, 61, of Sandy Level, Va., a former employee of Ed4Mill, the Pennsylvania company.

The pair defrauded the government of $24 million between 2009 and 2013, federal prosecutors said. They could face up to 20 years in prison and a $250,000 fine when they are sentenced Jan. 24, 2018.

The women have also been ordered to repay the $24 million, although authorities were uncertain how much money would ultimately be recovered. It was unclear Tuesday whether the women had benefitted personally from the scam.

“DiBisceglie and Sechrist were part of an elaborate bait-and-switch scheme that stole millions of dollars in Post-9/11 GI Bill tuition assistance," acting U.S. Attorney William E. Fitzpatrick said in a statement. "Instead of receiving a quality education under the Caldwell brand, the veterans that were recruited by Ed4Mil were enrolled in unapproved online courses without their knowledge, all while members of the conspiracy profited from their hard-earned benefits.”

“Scams like this steal money from hardworking taxpayers and legitimate students -- and in this case, our veterans -- and that is completely unacceptable," said Debbi Mayer, assistant special agent in charge of the U.S. Department of Education Office of Inspector General's Northeastern Regional Office, which helped investigate the case.

Also indicted was David Alvey, 50, of Harrisburg, Pa., the founder and president of Ed4Mil. He is charged with one count of conspiracy to commit wire fraud. His case is still pending.

Caldwell University officials said in a statement that they ended their relationship with Ed4Mil in 2013 and only learned of the "bait-and-switch" scheme after DiBisceglie quit her assistant dean position to work for Ed4Mil.

“Neither Caldwell University nor its current administration or staff is accused of wrongdoing, and only learned of the conduct after the former employee left the school to work for Ed4Mil,” the university said in a statement. “Caldwell University has and will continue to cooperate with the government until this investigation is concluded.”

The government was charged between $4,500 and $26,000 per course, instead of the $600 to $1,000 per course the correspondence company charged for the same classes, prosecutors said.

The $24 million in tuition benefits collected through the GI Bill was allegedly paid to Caldwell University, which then turned over between 85 percent and 90 percent of the money to Ed4Mil, according to court documents.

The Post-9/11 GI Bill was created after the Sept. 11, 2001, terrorist attacks to give military veterans money for tuition, housing and other education costs. The money is paid directly to colleges for eligible courses.