International Student Recruiting Firm Faces False Claims Act Complaint for Violating Federal Student Aid Programs,

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The Study Across the Pond LLC (SATP), an international student recruiting firm, is facing a False Claims Act complaint filed by the United States Department of Justice. The complaint alleges that SATP and its principal, John Borhaug, knowingly caused UK schools to submit false claims to the Department of Education for federal student aid.

SATP, based in Massachusetts, recruits American students to attend foreign schools in the UK and other countries. The complaint states that SATP demanded that the foreign schools enter into arrangements that violated the federal ban on incentive-based compensation. This ban, established under Title IV of the Higher Education Act, aims to protect students from aggressive recruitment practices that prioritize the financial interests of recruiters over the educational needs of students.

The complaint alleges that SATP collaborated with at least 28 UK schools in violating the Incentive Compensation Ban while participating in a federal student aid program. SATP recruited American students to attend these schools and demanded a commission, which was essentially a share of the funds claimed from federal financial aid programs intended for American students.

The lawsuit was filed under the qui tam, or whistleblower, provisions of the False Claims Act. The government is entitled to intervene in the lawsuit and share in any recovery. The Department of Justice emphasizes its commitment to upholding the ban on incentive compensation, protecting the integrity of federal student financial aid programs, and ensuring that students can make enrollment decisions without improper influence.

While the claims against SATP and Borhaug are allegations at this stage, the lawsuit highlights the government’s dedication to investigating and addressing violations of the False Claims Act in the education sector.

It is important to note that this is not the first time the Department of Justice has pursued cases related to fraudulent practices in the higher education industry. In recent years, there have been several high-profile cases involving for-profit colleges and universities that misled students and defrauded federal student aid programs. These cases serve as a reminder of the ongoing efforts to protect students and maintain the integrity of the education system.

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