A federal appeals court Wednesday ordered a for-profit college to defend itself on charges it defrauded the U.S. government by altering grade and attendance records in an effort to receive more federal student aid.
The ruling by the U.S. Court of Appeals for the Eighth Circuit came in a False Claims Act lawsuit launched by two former employees against Western Educational Inc., which operates 10 campuses nationally and is known as Heritage College. A lower court had dismissed the employees' claims.
The plaintiffs allege the for-profit college committed fraud by signing a federal Program Participation Agreement, or PPA, without intending to maintain the records necessary for receiving federal funds.
False Claims Act lawsuits against higher education companies are common, and most tend to be dismissed. Under the act, plaintiffs or relators sue on behalf of the federal government claiming the defendants have committed fraud. The government is not required to join the case -- it did not in this case -- and the plaintiff shares any financial penalties.
Read more at Inside Higher Ed: https://www.insidehighered.com/news/2015/04/30/federal-appeals-court-requires-heritage-college-defend-itself-against-fraud-claims