Study Across the Pond, LLC, Federal Student Aid Program Fraud, Massachusetts 2024

BOSTON – In a shocking case of financial impropriety, Study Across the Pond, LLC (SATP) and its principal, John Borhaug, have agreed to pay $1.3 million to resolve a lawsuit alleging that they knowingly caused United Kingdom (UK) schools to submit false claims to the U.S. Department of Education.

The United States filed a complaint against SATP and Borhaug in April 2024, alleging that they convinced foreign schools to enter arrangements that violated the federal ban on incentive-based compensation for student recruitment.

"Today's settlement resolves the United States' lawsuit against Study Across the Pond and Mr. Borhaug, who used improper incentives in an attempt to influence American students to attend foreign schools," said United States Attorney Leah B. Foley. "My office is committed to ensuring American students are not taken advantage of for financial gain and protecting the integrity of federal student financial aid programs."

The Incentive Compensation Ban, Title IV of the Higher Education Act, prohibits any institution of higher education that receives federal student aid from compensating student recruiters with a commission, bonus, or other incentive payment based directly or indirectly on the recruiters' success in securing student enrollments.

According to facts admitted in the settlement agreement, SATP entered into contracts with UK schools that provided that SATP received a percentage share of the American student's tuition to the UK school in exchange for SATP's recruitment of that student. Meanwhile, federal student financial aid programs paid those American students' tuition, of which SATP received a share under the illegal agreement.

As part of today's resolution, the relator will receive a share of the settlement amount. U.S. Attorney Foley, Assistant Attorney General Brett Shumate, and DOE-OIG Assistant IG Jason Williams made the announcement today. Assistant U.S. Attorneys Brian LaMacchia and Alexandra Brazier of the Affirmative Civil Enforcement Unit are handling the matter along with Trial Attorney Allison Carroll of the Justice Department's Civil Division.

The claims resolved in today's settlement include claims that were brought under the qui tam or whistleblower provisions of the False Claims Act, a law that allows a private party to file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned United States ex rel. Hitrost LLC v. Study Across the Pond, LLC, et al., No. 21-CV-10274-ADB (D. Mass.).

Defendant: Study Across the Pond, LLC, Crime: Federal Student Aid Program Fraud, State: Massachusetts, Year: 2024, Sentence: $1.3 million settlement.

Source: https://www.justice.gov/usao-ma/pr/student-recruiting-firm-and-its-principal-agree-pay-13-million-fraud-federal-student-aid