OIG: Office of Inspector General
   Current Section

Investigation Report

August 8, 2008
U.S. Department of Justice


Telephone: (205) 244-2001
Fax: (205) 244-2171

Scottsboro Woman Sentenced to 30 Months for Role in Pell Grant Fraud

BIRMINGHAM, AL — WANDA BELL GAITHER, 58, of Scottsboro, Alabama, was sentenced today by United States District Court Judge R. David Proctor to 30 months in federal prison for her managerial role in a scheme that defrauded the United States Department of Education of approximately $100,000.00. GAITHER was also ordered to pay restitution in the amount of $107,527.00. The sentence is announced today by United States Attorney Alice H. Martin and the U.S. Department of Education Office of Inspector General.

GAITHER was the owner of Gaither and Company Beauty School in Scottsboro, where the majority of students received Pell Grant awards to cover their tuition. GAITHER pled guilty in April to participating in and directing her employees to participate in a scheme in which Gaither and Company Beauty School submitted falsified Pell Grant applications to obtain Pell Grant funds for which students were not qualified.

"The Pell Grant program exists to help the neediest people in our society receive higher education and vocational training that they otherwise could not afford. When someone like Wanda Gaither steals from that program, she steals from those people who truly need those education dollars," said Alice H. Martin, U.S. Attorney for the Northern District of Alabama.

"I am proud of the work of OIG Special Agents and their commitment to protecting the integrity of federal education funds," said Mary Mitchelson, Acting Inspector General for the U.S. Department of Education. "We will continue to work with our colleagues in law enforcement to aggressively pursue those who seek to defraud federal education programs at the expense of our nation's students.

This case was investigated by Special Agents of the U.S. Department of Education Office of Inspector General. Assistant United States Attorneys Melissa K. Atwood and William C. Athanas and Trial Attorney Nicola Mrazek of the United States Department of Justice Fraud Section prosecuted this matter on behalf of the United States.

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Last Modified: 08/22/2008