FBI raids Michigan Jewish college suspected of defrauding federal government
Source: haaretz.com
Michigan Jewish Institute students claimed $25 million in Pell Grants; almost all of them took courses at yeshivas and seminaries in Israel that they never completed.
Federal agents raided the offices of a Jewish college that has prospered from millions of dollars in federal aid even though almost all its students live in Israel and hardly any of them graduate.
Federal officials declined to comment on the reason for the July 7 raid at Michigan Jewish Institute, in a suburb of Detroit.
But in 2012, the Forward showed how MJI’s assets soared as the college enrolled thousands of students in distance and online learning courses.
During a five-year period, MJI’s students claimed $25 million under the Federal Pell Grant Program, which is designed for the neediest American students.
Almost all those students took degree courses in Judaic studies at yeshivas and seminaries in Israel that they never completed.
Although MJI’s academic record has been poor, its assets have increased to $4.6 million in 2013, the most recent tax year available, from $1.2 million in 2008.
About 15 federal agents descended on MJI’s administrative offices in Southfield, a suburb of Detroit, on the morning of July 7.
According to an eyewitness to the raid, who did not wish to be named, the agents herded employees into a conference room, took their personal details and then sent them home.
The eyewitness saw agents bringing boxes into the building on a hand truck.
A spokeswoman for the Department of Education’s Office of the Inspector General, Catherine Grant, confirmed on July 7 that agents were “on site” at MJI. She declined to give any further information.
Rabbi Kasriel Shemtov, MJI’s president, and Dov Stein, MJI’s director of academic administration, did not respond to requests for comment.
MJI has grown from a college of about 300 students in 2004 to one with more than 2,000 students today. But when a Forward reporter visited MJI’s headquarters, in the leafy suburb of West Bloomfield, in 2012, the only students on campus were a couple of dozen high schoolers taking dual-enrollment Hebrew classes. That’s because almost all of MJI’s students live overseas.
Even so, because they are U.S. citizens they can claim financial assistance under the Federal Pell Grant Program, which is currently worth $5,730 per student.
MJI charges students an administrative fee of more than $2,500 for its study-abroad program in addition to the host school’s tuition fee.
When the Forward wrote about MJI in 2012, according to DOE figures only 10% of students went on from their freshman year to their sophomore year. In 2011, MJI awarded only three bachelor’s degrees.
The year after the Forward’s focus on MJI, the college’s academic record improved dramatically. In 2012, according to government figures that are based on submissions by colleges, 40% of students returned from their freshman to their sophomore year and MJI awarded 20 bachelor’s degrees.
Despite the lack of students on campus, MJI has moved ahead in recent years with ambitious expansion plans.
Currently, the college’s few on-site classes are run out of rooms in The Shul, an impressive $6 million synagogue.
The Shul sits at the heart of the 45-acre Campus of Living Judaism, which is affiliated with the Chabad-Lubavitch movement. The Shul is led by MJI’s president, Shemtov, a son of Berel Shemtov, the powerful leader of Chabad of Michigan.
Another of Berel Shemtov’s children, Bassie Shemtov, is the director and co-founder of the hugely successful Friendship Circle, a group that caters to children with special needs. The Friendship Circle’s flagship headquarters is also based on the Campus of Living Judaism.
In January 2013, West Bloomfield Township granted permission for MJI to build a third building on the Campus of Living Judaism.
The building would be the 16,000 square-foot headquarters for MJI, which was to include office space for 42 administrative staff and six classrooms.
At around the same time as building work began, MJI was struggling to renew its grant of accreditation.
The Accrediting Council for Independent Colleges and Schools, MJI’s accrediting agency, deferred its decision on renewal three times — a rare number of deferrals for the council — before finally renewing MJI’s accreditation on the school’s fourth attempt, in April 2014. Throughout the process, ACICS and MJI declined to divulge the reason for the deferrals.
A spokesman for ACICS, Anthony Bieda, would say only that “it has to do with compliance with our standards and expectations.”
Source: haaretz.com
