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Whistleblower Proceeds Alone, Recovers Near $58M for Alleged Student Loan Fraud

November 20, 2010

After a former employee of the Department of Education blew the whistle on alleged fraud involving federal student financial aid programs, Nelnet Inc. paid $47 million, Southwest Student Services Corp. paid $5 million, Brazos Higher Education Authority paid $4 million, and Panhandle Plains Higher Education Authority paid $1.75 million, announced DoJ this week.  Although the Department of Justice declined to intervene in the case, the whistleblower, Dr. Jonathan Oberg, continued to pursue the lenders for allegedly “created billing systems that allowed them to receive improperly inflated interest rate subsidies from the Department of Education.”  For exposing the lenders’ actions and litigating the case, Dr. Oberg will receive $16.5 million.  Tony West, Assistant Attorney General for the Civil Division of the Department of Justice expressed his appreciation to Mr. Oberg and other whistleblowers for continuing to pursue such cases where others will not:

“Collaboration between the federal government and citizens with knowledge of fraud is important to the successful enforcement of the False Claims Act. Whistleblowers like Dr. Oberg are critical to our efforts to recover taxpayer money lost to waste, fraud, and abuse.”

To report False Claims Act violations, contact Frohsin & Barger.

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