July 1, 2014

Students seeking admission to college know how expensive tuition can be and often apply for financial assistance using the Free Application for Federal Student Aid (FAFSA). FAFSA helps eligible students by providing access to federal grants and loans to pay for their college education. Unfortunately, the temptation of receiving “free” financial aid may lead some people to lie on their FAFSA application.

Wallin & Klarich wants you to be aware that if you filed a fraudulent claim for student financial aid, you may have violated federal law. 20 U.S.C. section 1097 makes it a federal offense to knowingly and willfully obtain student aid funds by means of making false statements to the government.

A recent decision by the United States Court of Appeals for the Ninth Circuit illustrates how you can be charged with committing financial aid fraud. If you are convicted of this federal offense, you may have to pay a substantial fine, serve time in prison, or both.

U.S. v. Carlos Javier Ezeta (Case No. 12-10304, 9th Cir. May 23, 2014)

fraudulent claim for student financial aid
There are serious consequences for making a fraudulent claim for student financial aid.

Between 2008 and 2011, defendant Carlos Javier Ezeta worked as a counselor and professor at the College of Southern Nevada (CSN). Motivated by his interest in helping the Hispanic community, Ezeta often assisted Spanish-speaking students in their CSN applications and selecting courses. Beyond performing his official duties, Ezeta “helped” these students obtain federal financial aid by falsifying several FAFSA applications which he later filed electronically. Based on false representations made on the forms, student aid money was dispersed to several students.

Ezeta learned that the students had not successfully completed high school, received a GED, or an “ability-to-benefit” test. To qualify for funding, the U.S. Department of Education requires that at least one of these conditions be satisfied in order for an applicant for federal student aid to be eligible.

On the forms, Ezeta falsely reported that the students satisfied the education requirements and submitted the forms without the students’ knowledge that they contained false information.

Eight applications were generated and six students obtained funding in the amount of $8,709. One application was intercepted before money could be dispersed, and another was never sent because the student had yet to obtain a phony certificate of high school completion. In all, the falsified documents sought financial aid amounting to over $37,000.

An undercover sting operation was launched and Ezeta eventually admitted to falsifying the applications. Although he did not personally obtain any funding, Ezeta was arrested and charged with four felony counts of financial aid fraud in violation of 20 U.S.C. section 1097(a).

The Ninth Circuit Court concluded that although Ezeta did not receive any money himself, criminal liability under federal law extends to knowingly and willfully causing the funds to be disbursed to a third party by fraud, false statement or forgery.

Consequences of Federal Financial Aid Fraud (20 U.S.C. section 1097)

Federal law prohibits anyone from knowingly and willfully embezzling, stealing, or obtaining by fraud, false statement or forgery any funds provided for higher education purposes.

If the amount of the funds provided is $200 or more, you could be charged with a felony. If you are convicted of a felony violation of financial aid fraud under federal law, you could be imprisoned for up to five years, fined a maximum of $20,000, or both.

If the funds are less than $200, you face a misdemeanor charge. A misdemeanor violation under 20 U.S.C. 1097(a) carries a sentence of not more than one year in prison, up to a $5,000 fine, or both.

Federal law also prohibits the acceptance of a loan made under false pretenses. If you are convicted of intentionally providing false information in order to obtain a federal student aid loan, you face a misdemeanor, punishable by up to one year in prison, a maximum fine of $10,000, or both (20 U.S.C. 1097(b)).

Because fraud is considered a crime of moral turpitude, a federal fraud conviction can also result in disciplinary proceedings being brought against you if you hold a professional license (such as a teacher), and may also lead to your deportation if you are not a U.S. citizen.

Falsifying an Application for Financial Aid is Risky and Foolish

In the example above, the defendant seemed to have good intentions. After all, he simply wanted to help students from the Hispanic community to pay for their college education. However, as the court pointed out, a crime committed with a “good heart” is still a crime.

Additionally, the court noted the professor stood to benefit indirectly from his wrongdoing since the unlawfully obtained funding provided to his students would go to the college where he was employed.

Contact Wallin & Klarich if You are Facing Federal Fraud Charges

federal fraud attorneys
Call our experienced federal fraud attorneys today so we can begin to help you.

If you or someone you care about is facing federal fraud charges, you should contact an experienced federal defense attorney at Wallin & Klarich today. Our attorneys have over 30 years of experience in state and federal court successfully defending our clients facing fraud-related charges.

Hiring an attorney from Wallin & Klarich to represent you may be your best chance to avoid the serious consequences of a federal fraud conviction.

With offices in Los Angeles, Sherman Oaks, Torrance, Tustin, San Diego, Riverside, San Bernardino, Ventura, West Covina and Victorville, our attorneys are available 24 hours a day, 7 days a week, to make certain all of your constitutional rights are protected. We will evaluate and employ every available strategy that helps you achieve the best result possible in your case.

Call us today at (877) 4-NO-JAIL or (877) 466-5245 for a free telephone consultation. We will get through this together.

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Author: Paul Wallin

Paul Wallin is one of the most highly respected attorneys in Southern California. His vast experience, zealous advocacy for his clients and extensive knowledge of many areas of the law make Mr. Wallin a premiere Southern California attorney. Mr. Wallin founded Wallin & Klarich in 1981. As the senior partner of Wallin & Klarich, Mr. Wallin has been successfully representing clients for more than 30 years. Clients come to him for help in matters involving assault and battery, drug crimes, juvenile crimes, theft, manslaughter, sex offenses, murder, violent crimes, misdemeanors and felonies. Mr. Wallin also helps clients with family law matters such as divorce and child custody.

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