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S. Hrg. 103—491

ABUSES IN FEDERAL STUDENT GRANT PROGRAMS

HEARINGS

BEFORE THE

PERMANENT
SUBCOMMITTEE ON INVESTIGATIONS

OF THE

COMMITTEE ON
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE

ONE HUNDRED THIRD CONGRESS

FIRST SESSION

OCTOBER 27-28, 1993

Printed for the use of the Committee on Governmental Affairs

U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 1994

73-880 cc

For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC 20402

ISBN 0-16-044134-X

3

77 SU
XL

684

HABENDA

212 211cn non

COMMITTEE ON GOVERNMENTAL AFFAIRS

JOHN GLENN, Ohio, Chairman SAM NUNN, Georgia

WILLIAM V. ROTH, Jr., Delaware CARL LEVIN, Michigan

TED STEVENS, Alaska JIM SASSER, Tennessee

WILLIAM S. COHEN, Maine DAVID PRYOR, Arkansas

THAD COCHRAN, Mississippi JOSEPH I. LIEBERMAN, Connecticut

JOHN MCCAIN, Arizona DANIEL K. AKAKA, Hawaii

ROBERT F. BENNETT, Utah
BYRON L. DORGAN, North Dakota

Leonard Weiss, Staff Director
Franklin G. Polk, Minority Staff Director and Chief Counsel

Michal Sue Prosser, Chief Clerk

PERMANENT SUBCOMMITTEE ON INVESTIGATIONS

SAM NUNN, Georgia, Chairman

JOHN GLENN, Ohio, Vice Chairman CARL LEVIN, Michigan

WILLIAM V. ROTH, Jr., Delaware JIM SASSER, Tennessee

TED STEVENS, Alaska DAVID PRYOR, Arkansas

WILLIAM S. COHEN, Maine JOSEPH I. LIEBERMAN, Connecticut THAD COCHRAN, Mississippi BYRON L. DORGAN, North Dakota

JOHN MCCAIN, Arizona

ROBERT F. BENNETT, Utah
Eleanore Hill, Chief Counsel
Daniel F. Rinzel, Chief Counsel to the Minority

Mary D. Robertson, Chief Clerk

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(II)

Page

17 199

Stiener, Richard C.:

Testimony

Prepared statement
Thomas, James B.:

Testimony
Prepared statement

75 212

APPENDIX

Staff statement
Prepared statements of witnesses in order of appearance

135 11

EXHIBITS

1. Selected documents from U.S. Department of Education certification

and eligibility files regarding Beth Rochel Seminary 2. Beth Rochel School Bulletin, Independent Study Program, dated 1989–

90, 1990–91 and 1991-92 3. Selected documents pertaining to the accreditation of Beth Rochel Semi

nary by the Accrediting Council for Continuing Education & Training

(ACCET), dated August 23, 1990 through October 22, 1991 4. Miscellaneous documents regarding Beth Rochel Seminary Mentor Em

ployees 5. Beth Rochel School for Girls “Personnel Manual" 6. U.S. Secret Service Report of Examination regarding Handwriting Anal

ysis of Pell Grant applications and various school documents, with

exhibits 7. Deposition of Rabbi Jacob Rosenbaum, Director, Beth Rochel Seminary,

before the Senate Permanent Subcommittee on Investigations, dated

June 30, 1993
8. SEALED EXHIBIT: Various workpapers of the U.S. General Accounting

Office, Office of Special Investigations, regarding investigation of Beth
Rochel Seminary, including students applications for enrollment, re-
duced priced meals, transportation and the Beth Rochel School for

Girls
9. SEALED EXHIBIT: U.S. Department of Education Pell Grant Program

Student Payment Summary for Beth Rochel Seminary for the 1990–

91 and 1991-92 school years 10. Financial Statement of Beth Rochel Seminary, as prepared by Mayer

Rispler & Company, Certified Public Accountants, as of June 30,

1988 11. Letter to Beth Rochel Seminary, dated September 23, 1992, from U.S.

Department of Education, regarding intention to terminate the school

from Federal Student Financial Aid 12. U.S. Department of Education Decision, issued October 20, 1993, re

garding Beth Rochel Seminary's termination of the eligibility to par

ticipate in the Federal Student Financial Aid Programs 13. Letter to the Permanent Subcommittee on Investigations, dated Sep

tember 20, 1993, from Leigh M. Manasevit, Esquire, Brustein &

Manasevit, regarding Tzini Berger 14. Selected documents pertaining to U.S. Department of Education eligi

bility determination of Sara Schenirer Teachers Seminary, Brooklyn,

New York, dated August 8, 1974 through May 13, 1993
15. Selected documents pertaining to the accreditation of Sara Schenirer

Teachers Seminary by the Accrediting Council for Continuing Edu-
cation & Training (AČCET), dated September 5, 1988 through April

14, 1992
16. Program and institutional gues of Sara Schenirer Teachers Semi-

nary, dated 1988–89, 1989–90, 1990–91 and 1992–93 17. Internal Revenue Service Forms 990 for the years 1989 through 1991,

as filed by Sara Schenirer Teachers Seminary

.............

Page

18. Financial Reports (Balance Sheet Compilation) of Beis Sefer Govoha

Lebanos Sara Schenirer, as prepared by Hirsch, Delbaum, Bram &
Hanover, Certified Public Accountants, for the years 1989 through

1992
19. Auditor's Reports and Examinations (2) of Sara Schenirer Teachers

Seminary's participation in the Student Financial Assistance and Pell
Grant Programs, prepared by Samuel Kohn, CPA, for the periods
July 1988 through June 30, 1989, and July 1, 1989 through June

30, 1991 and supporting workpapers
20. Settlement Agreement between Sara Schenirer Teachers Seminary and

the U.S. Department of Education, pertaining to the school's failure
to submit audits of its administration of Federal student financial

aid funds, dated April 13, 1990
21. Review of Sara Schenirer Teachers Seminary's Eligibility to Participate

in Federal Student Financial Aid Programs, prepared by the U.S.
Department of Education, Office of Inspector General, Audit Control

Number 02-40082, dated January 28, 1986 and related materials 22. Program Reviews (2) of Sara Schenirer Teachers Seminary, prepared

by the U.S. Department of Education, dated September 26, 1991

and June 30, 1993 23. SEALED EXHIBIT: U.S. Department of Education Pell Grant Program

Student Payment Summary for Sara Schenirer Teachers Seminary

for the 1992–93 school year 24. Letter to the Permanent Subcommittee on Investigations, dated October

12, 1993, from Michael D. Hays, Esquire, Dow, Lohnes & Albertson,

regarding testimony of Michoel Meisels and Tobi Broyde 25. Agreement and Understanding Between Sara Schenirer Teachers Semi

nary and Innovative Consultants (Mr. Yehuda Lowinger), for the

period September 1, 1989 through August 31, 1991 26. Letter to Permanent Subcommittee on Investigations, dated October

13, 1993, from George S. Meissner, Esquire, Meissner, Kleinberg &

Finkel, regarding Yehuda Lowinger 27. Letter to Permanent Subcommittee on Investigations, dated October

5, 1993, from M. Joshua Aber, Esquire, regarding Yitzchak

Eichenthal 28. Memorandum of Permanent Subcommittee on Investigations, dated Au

gust 17, 1993, regarding telephone conversation with Michael D.

Hays, Counsel for Sara Schenirer Teachers Seminary 29. Memorandum of the Permanent Subcommittee on Investigations, dated

September 8, 1993, listing Sara Schenirer Teachers Seminary stu

dents who attended multiple schools and received Pell Grants 30. Affidavit of Donald S. Bluestone made to the Permanent Subcommittee

on Investigations, dated July 20, 1993, regarding Sara Schenirer

Teachers Seminary 31. SEALED EXHIBIT: Various memoranda of interviews prepared by Of

fice of Special Investigations, General Accounting Office 32. SEALED EXHIBIT: Student files produced by Bais Fruma pursuant

to Permanent Subcommittee on Investigations' subpoena 33. SEALED EXHIBIT: Selected Bais Fruma student files from the office

of Jacob Ginzburg 34. SEALED EXHIBIT: Monthly account statements and cancelled checks

reflecting checking accounts held by Bais Fruma at various banking

institutions for the period 1989–93.
35. Letter to Alan Edelman, Esquire, Permanent Subcommittee on Inves-

tigations, dated October 20, 1993, from David S. Sabghir, Esquire,
regarding appearance before the Subcommittee of Mr. B. Eliezer

Herbst
36. Letter to Alan Edelman, Esquire, Permanent Subcommittee on Inves-

tigations, dated October 12, 1993, from George S. Meissner, Esquire,
regarding appearances before the Subcommittee of Messrs. George

Goldberger, Yitzchak Klein, Charles Ettinger, and Tovia Rottenberg 37. Letter to Alan Edelman, Esquire, Permanent Subcommittee on Inves

tigations, dated October 12, 1993, from George S. Meissner, Esquire,
regarding appearance before of the Subcommittee of Messrs. S. Kohen

and Sandy Gross
38. Various forged verification letters taken from student files from offices

of Jacob Ginzburg

264

274

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