Owner of Philadelphia Technical School Indicted for $1.2 Million Student Aid Fraud

PHILADELPHIA - Acting United States Attorney Laurie Magid today announced the filing of an indictmene charging Thomas Mathew, a/k/a "Thomaskutty Mathew," with multiple counts of mail and wire fraud, theft, and false statements. Defendant Thomas Mathew owned and operated the American Center for Technical Arts and Sciepces (ACTAS), a technical school with two Philadelphia campuses that offered vocational training for adult students in business, medical and computer fields. The indictment charges that in 2003 and 2004 ACTAS fraudulently received approximately $1.2 million in Pell Grant funds and student loans for students who had dropped out of the school's programs. Instead of refunding the money to the Department of Education, the indictment alleges the defendant kept it for himself.

According to the indictment, during this same period, Mathew devised a scheme to defraud the Pennsylvania Department of Labor and Industry by causing ACTAS employees to file claims for unemployment compensation when they were still working for ACTAS but being paid "under the table.

"Mathew's double rip off stole from programs intended to help students and the unemployed," said Magid. "While enriching himself, he reduced the amount of funding available for eligible students who rely on federal funding to pay for their education. At the same time he stole federal student funds, he also stole from a state program meant to assist those who are unemployed."

If convicted, the defendant faces a guideline sentencing range of 46 to 57 months in prison, a $5 million fine, three years of supervised release, and a $2,000 special assessment.

This case was investigated by agents from the United States Department of EducationOffice of Inspector General, the United States Department of Labor, Office of Inspector General, Office of Labor, Racketeering, and Fraud Investigations, and an investigator from the Pennsylvania Department of Labor and Industry, Internal Audits Division. It is being prosecuted by Assistant United States Attorney Thomas M. Zaleski.