Educational facilities as well as their owners and operators were charged with a massive case of fraud in Illinois court, according to a Chicago Tribune report on Monday. The tutoring firms are charged with having defrauded hundreds of public school districts throughout 19 states – including the firm’s home state of Illinois. They have allegedly defrauded more than $33 million in educational funding. The names of the companies are Brilliance Academy Inc. and Babbage Net Schools Inc. They are based in Niles, Illinois, which is located just northwest of Chicago.
The firms’ criminal acts involved misleading schools regarding the nature and quality of their businesses’ tutoring services – misleading information that would enhance the financial benefits of the companies and their owners. The owners are Jowhar Soultanali and his son Kabir Kassam. As co-owners, Soultanali – the director of operations at Brilliance Academy Inc. and at Babbage Net Inc. – and Kassam – president of the two companies – have been indicted.
Specifically, Soultanali, a 58-year-old from Morton Grove, and Babbage Net School have been charged with eight counts. Five counts are for having allegedly committed mail fraud as well as three counts of federal program bribery. Kassam, a 34-year-old from Wheeling, and Brilliance Academy have been charged with seven counts. Five counts of mail fraud and three counts of federal program bribery have been charged.
The two owners had been approved as Supplemental Educational Services providers in Illinois and 17 other states across the county during two school years. The first was the 2008-2009 school year and the next was 2009-2010. The father-son team are also being charged with bribing three school officials in Texas and one New Mexico state education official for having recruited students and steering federal and state funds to their two companies.
The bribery charges have extended to other individuals as well, according to a related-CBS report. On the federal program bribery charges, Arturo Martinez who is a 52-year-old administrator with the New Mexico Public Education Department has been charged. Additionally, Cedric Petersen who is a 61-year-old assistant principal at Fox Technical High School in San Antonio, Armando Rodriguez who is a 54-year-old former SES coordinator at Roy Miller High in Corpus Christi, and Brian Harris who is a 33-year old SES coordinator at Sam Houston High in San Antonio have are all facing charges. Each of these individuals allegedly received an unspecified amount of bribe money. Peterson also accepted at least one Caribbean cruise vacation.
Across the 17 states, Soultanali kept 8 million and Kassam kept $13.6 million for themselves from approximately $33 million they received from more than 200 public school districts. Besides the illegally obtained educational funds, the court case is attempting to have possessions of the two men forfeited. Of the forfeitures sought, the federal authorities are going after the homes of the two, as well as three additional condominiums, five luxury automobiles, six life insurance policies, and diamond jewelry purchases made in 2009.
The reports claim that the company co-owners Soultanali and Kassam and the four alleged bribe-takers, as well as the two educational tutoring companies will be arraigned in U.S. District Court in Chicago at a future time. The maximum sentence for each count of federal program bribery is 10 years in prison and a fine of $250,000. The mail fraud violation carries a maximum of 20 years in prison and a $250,000 fine for each violation. The two companies, Brilliance Academy and Babbage Net are facing a maximum penalty of a-five-year probation and a $250,000 fine each.