Jewish college under investigation over Pell Grants

Kim Kozlowski
The Detroit News

The Michigan Jewish Institute is under investigation by the U.S. Department of Education’s Office of Inspector General, officials confirmed Thursday.

The investigation comes after the U.S. Department of Education notified the private, four-year college in West Bloomfield Township it would no longer be eligible for federal student financial aid, which includes student loans and Pell Grants, awarded to low-income students.

The school was notified of the cut-off of federal funds after officials discovered the college allegedly fraudulently obtained more than 2,000 grants for students who studied in Israel but had no intention of getting a degree, according to a Feb. 26 letter sent to Rabbi Kasriel Shemtov, the Michigan Jewish Institute’s president.

“We do have an investigation of the Michigan Jewish Institute under way,” Catherine Grant, spokeswoman for the Office of Inspector General, wrote via email. “Per our policy, however, we do not discuss details of our ongoing work. This longstanding policy is in place to protect and maintain the integrity of our efforts.”

Grant added she could not comment further.

The Office of Inspector General conducts independent and objective investigations, audits and inspections of fraud, waste or abuse of Department of Education funds, according to the department’s website.

In a statement sent by Mort Meisner Associates, Michigan Jewish Institute denied all of the allegations.

“Its decision is inaccurate, relies on hearsay, speculation, and information that would not be admitted into any court of competent jurisdiction as credible evidence,” the statement said. “It is arbitrary and capricious in the extreme.”

Last July, federal agents seized thousands of documents in more than 130 boxes of files during a raid at the Michigan Jewish Institute and The Shul Chabad-Lubavitch, the affiliated Orthodox Jewish group which houses the college campus. Most of the boxes were filled with student records and included one labeled as “Pell Grant fraud.”

Pell Grants are funding from the federal government for low-income students to mitigate the costs of college and do not have to be paid back.

To receive a Pell Grant, a students must be a “regular” student of a college, according to the letter. That means a student is either enrolled or accepted for an enrollment at a higher education institution for earning a degree, certificate or other credential at that institution.

It is not clear how many federal dollars were funneled to students in Israel. But the maximum Pell Grant for the 2014-15 was $5,730 for students enrolled on a full-time, full-year basis, according to Michigan Jewish Institute’s website.

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