Feds affirm halt in funding to Jewish college accused of fraud


(JTA) — The U.S. Department of Education upheld its decision to withhold federal student financial aid from a Jewish college in suburban Detroit.

The Education Department last month cut off the federal funding to the Michigan Jewish Institute, after the four-year college in West Bloomfield illegally obtained the Pell Grants and loans for students in its study abroad program. The students, who studied in Israel at yeshivas and seminaries, had no intention of getting a degree, according to the department.

The institute, which has about 2,000 students, received millions of dollars in Title IV funds under the federal Pell Grant Program between 2006 and 2012.

“For an institution to be eligible to receive Title IV funds, it must award those funds only to eligible students. And for a student to be eligible to receive federal student financial assistance, he or she must intend to receive a degree from the institution where he or she has enrolled,” read a letter sent to the college on April 15 and obtained by the Detroit Free Press. “Title IV funds are not available for the benefit of institutions; they are available for the benefit of students attending those institutions. Here, MJI created a scheme with little or no regard for the integrity of the Title IV programs, and the department, as steward of these funds, must end MJI’s Title IV eligibility.”

The letter said that the college could reapply to be eligible to receive the funding in the future.

The Department of Education in a letter sent to the college in February asserted that many of the students identified by the institute as living in Israel and being enrolled in distance and online learning courses actually have “no meaningful connection” to the institute, and that the institute just uses them to obtain additional Pell Grants illegally. The letter was signed by Susan Crim, director of the department’s Administrative Actions and Appeals Service Group.

The April 15 letter is the response to the college’s appeal of the February letter.

Most of the onsite classes take place in West Bloomfield at a synagogue located on the 45-acre Campus of Living Judaism, which is affiliated with the Chabad-Lubavitch movement.

Last July, federal agents raided the offices of the college at the synagogue and in offices in Southfield, Michigan.

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