OIG: Office of Inspector General
   Current Section

Investigative Reports

August 11, 1999

Contact Person::
Traci Wilnerd (316) 269-6481
1200 Epic Center
301 N. Main
Wichita, Kansas 67202

Investigation into Pell Grant Fraud Results in 290 Settlement Agreements -1.6 Million in Penalties and Restitution

WICHITA - United States Attorney Jackie N. Williams announced today that a two year investigation into Pell Grant Fraud has uncovered over 300 cases in which students and their parents provided false information in order to obtain Pell Grants. Williams said that the false information ranged from the substantial understatement of the parents' income to students falsely claiming to be orphans or wards of the court. Orphans or wards of the court are not required to disclose their parent's income on Pell Grant applications.

Williams said that the civil investigation grew out of the criminal case of Ernest Dale Bleam, 62, Mulvane, Kansas, who was sentenced on Wednesday, July 15, 1998, to twenty-one months in federal prison, without parole, and ordered to pay a $5,000 fine for aiding students and parents in obtaining Pell Grants, most in Kansas and Missouri, based on false information. Bleam entered a guilty plea on April 13, 1998, to fraud against the Department of Education.

Williams further stated that the cases have resulted, to date, in 290 settlement agreements with the students and their parents to settle allegations of violations of False Claims Act and payment of over $1.6 million In restitution for grant repayment ($975,000) and penalties ($638,000).

The Pell Grant Program provides direct grants to help financially disadvantaged students obtain post secondary education. Grant amounts range from $400 to $3,125 for each academic year. Schools pay Pell Grants directly to the students or credit their school accounts from funding received from the Department of Education. Nationally, Congress allocates over $7 billion in Pell Grants each year to help over 3 million students attend school. In Kansas, the Pell Grant Program awards over $117 million each year to help over 50,000 students attend Kansas schools.

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Last Modified: 03/02/2005