TOTAL

APTI-8

REPORT 1 REPUNT 2 HEPUNT 3 NEPURT 4 NEPUNT S REPORT & NEPURT 7 REPUNT S

COUNT NIJMBER

This is a brief of our meeting with the Department of Education I.G., Department of Justice Attorneys and a representative from the HHS I.G. Α list of attendees is attached for your information.

I began the meeting by advising the participants that you had intended to be there but had been called away at the last minute. I advised the I.G. people that projects completed to date indicate serious problems with a number of New York religious schools and that you (SFA) and the Department of Justice were committed to doing case development work which may lead to administrative action, civil litigation or criminal convictions. I said that the purpose of the meeting was to get a commitment from I.G. investigations, I.G. audit and the HHS I.G. to devote staff resources to case development.

Since some of the attendees were not familiar with the problems being discussed I gave them a brief synopsis of the problems encountered with some institutions. (See Attachment A). I said that evidence developed to date indicates the problems found with regard to Be'er Shmuel have been found in other institutions as well. I continued by giving a summary of our findings with regard to the birth verification project - 633 births out of 1478 could not be verified (See Attachment B).

I also discussed the computer match projects we completed using Pell Grant data, cross matching one school's data against another, and the eight computer reports (Attachment C) we contemplate using to focus on Pell related problems at various schools.

I asked Steve Altman to discuss his impressions of the cases in development.
Steve advised that the evidence uncovered would dictate any action taken by
DOJ. He said that he would devote a substantial amount of his time to case
development as well as a substantial amount of Ron Clark's and Alan Klienburd's
time. Steve said there are basically two ways to work these cases. The first
is to work on the school eligibility aspect if a school was never eligible
then all the Title IV money they ever received must be returned. The second
is the student eligibility issue - which we have strong evidence for but which
must be developed further on a student by student basis. Steve said that we
would need person power commitments in order to focus on either area but that
it appears, at this time, that we will have to focus on the students. He said
he needed information that will require interviews.

73-880 094-15

I stated that SFA was prepared to match the I.G. person for person in devoting staff resources toward such a project. Arthur Sinai asked for our views on where we were going with all this data we are gathering.

I said that Steve and I had discussed this matter to some extent and I felt that we had to narrow our focus. I said that right now I have identified 10 school's which have received approximately 22 million in Title IV funds. I intend to check their financials to see if we could recover federal funds if we decided to file suit. I said that we would also explore the possibility of a common link between the schools (e.g. Rabbi A. Tenenbaum). I also said that it was my plan to refine the data in Attachment C so that an index could be developed which would indicate the degree of problems at a particular school. Once we decide which schools to focus on we would need the date of birth/place of birth data from SSA on each recipient and perform birth verification on each. We would need to perform program reviews and/or audits at each school. We would then need to interview students who appear to be problems - as a result of birth venfivation or program review/audit. Concurrently we would have to check the work of CPA's who have previously performed Title IV audits.

Once this developmental work has been completed we (the government) would then have to make decisions with regard to the type of action to take administrative action, no action, civil suit or criminal prosecution.

Mr.

Mr. Sinai said he would devote staff as needed but would commit to assigning one investigator to do interviews on a 1/2 time basis beginning September 17. SFA agreed to commit one person 1/2 time to assist with the interviews. Sinai also agreed to speak to the HHS Inspector General for investigations about opening a joint investigation and giving ED access to SS5 data.

I agreed to continue working with the I.G. in Region II on cross match projects with various agencies including the New York State Guarantee Agency. I also agreed that you would write to Frank Yanni requesting expansion of their audit of 3 I.C. schools to cover the other institutions which appear to have related problems.

I also advised Art Sinai that we are in the process of gathering data for each school which would show reported Title IV awards/expenditures for each year. He is interested in seeing the financial data for certain schools over the last three years. I feel that the meeting was productive in that specific commitments were made and that the people in attendance have a better understanding of the problems related to the New York religious schools. The meeting also helped the participants get a feel for the direction future projects must take if we expect to achieve a return.