A Louisiana man was convicted on Wednesday of defrauding the federal student loan system of more than $1.4 million in an elaborate scheme to impersonate students and hire impersonators to obtain financial assistance which he then pocketed.
The man, Elliott Sterling, of Baton Rouge, secured grants and loans for 180 students by using their personal information to complete federal financial aid applications and enroll them in classes at Baton Rouge Community College in September 2017 to November 2019, prosecutors said.
Mr Sterling, who was 32 when he was charged in September 2020, took most of the financial aid money for himself and spent more than $253,000 of it at Louisiana casinos , Nevada and Pennsylvania, prosecutors said.
A jury in the United States District Court for the Intermediate District of Louisiana convicted Mr. Sterling of 15 counts of wire fraud, financial aid fraud and money laundering. The FBI had seized approximately $422,600 of the proceeds, which the jury ordered forfeited.
Mr Sterling, who does not have a law degree, appeared in court this week claiming he was innocent and claiming he was being punished for ‘making money’, reported The Advocate, a Louisiana newspaper. Mr. Sterling did not respond to requests for comment on Saturday.
Edd Cole, special agent in charge of the Department of Education’s Inspector General’s Office of the South West Regional Office, said in a statement that the office is “committed to combatting student financial aid fraud. students and will continue to aggressively pursue anyone who orchestrates or participates in these types of crimes.”
Baton Rouge Community College said in a statement it hopes Elliott’s sentencing will deter others “who seek to deceive and abuse the federal student loan process.”
Kizzy Payton, a spokeswoman for the college, said Saturday the fraudulent activity came to the school’s attention after the FBI received an alert from BankMobile, a banking service the college uses to process money. financial aid.
“We then partnered with the FBI and maintained our strong internal controls to help minimize the impact of fraudulent activity and provided all requested documents to support the investigation,” Ms Payton said.
Mr Sterling first approached potential students to enroll in courses in September 2017 and offered to help them for a fee. He also promised some students that they could get financial aid that they would not need to repay.
To collect federal grants and loans, Mr. Sterling used students’ personal information and associated it with fraudulent obituaries, fraudulent diplomas and other falsified background details to complete the free application for federal student aid. students, known as FAFSA.
Most applicants were ineligible for federal financial aid without the false documents, including 145 students who had not actually received a high school diploma or its equivalent, such as a GED, and incarcerated students. prosecutors said. Students generally did not have access to their accounts with the FAFSA, the college, or the bank accounts that received the financial aid.
None of the students made academic progress in college and 172 failed or withdrew from every class they were enrolled in, prosecutors said.
In one instance, Mr. Sterling collected nearly $7,000 in federal student aid on a student’s behalf, but ultimately gave the student only $1,000.
Mr Sterling hid his role in preparing the financial aid documents and signed a form promising to repay the Ministry of Education for the loan, a principal promissory note, posing as the student.
Most of the students who received the money told investigators they did not know they had applied for student loans and that it was Mr Sterling who had signed notes promising they would repay the loans.
Mr. Sterling has accompanied many students to the college campus to help them complete the financial aid process. He also occasionally introduced himself as a student and offered to pay individuals to pose as students at the financial aid office.
In addition to the student loan program, Mr. Sterling also received a $90,000 loan from the Small Business Administration for his company, Sterling Educational Consulting LLC, after he falsified his company’s earnings in the aid application for helping businesses affected by the Covid-19 pandemic.
Sentencing of Mr Sterling is scheduled for July 7.