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Arizona College District Settles Qui Tam Case

The Justice Department announced that the Maricopa County Community College District (“MCCCD”) in Arizona has agreed to settle a qui tam case alleging it had knowingly submitted false claims to the government in order to receive federal funds.  MCCCD, based in Phoenix, operates the community college system in Maricopa County, Arizona.  According to its website, MCCCD is one of the largest providers of higher education in the United States, with 10 colleges and 2 skill-training centers.  According to the Department of Justice, MCCCD submitted false claims to the Americorps program run by the Corporation for National and Community Service (“CNCS”) in order to receive service-learning grants and awards.

CNCS is a federal agency established in 1993 that administers several service-oriented programs including Senior Corps, Americorps, and the Social Innovation Fund.   In 2011, Christine Hunt, an employee of Paradise Valley Community College, part of the MCCCD system, filed a complaint under the qui tam provisions of the False Claims Act alleging that MCCCD knowingly submitted falsified documents to the Americorp’s Project Ayuda program, a student community-service work program involving nearly 1,000 MCCCD students.    Specifically, the whistleblower alleged that she witnessed another MCCCD employee forging signatures and overstating the number of community-service work hours performed by students.

Students participating in the Project Ayuda program could receive awards of up to $5,350 in return for performing community service. It was alleged, however, that students received credit for work they did not actually perform, were credited for community-service work when they were doing schoolwork, or received credit for community service they performed prior to their involvement with the program.

The whistleblower filed her complaint under the qui tam provisions of the False Claims Act which permit individuals to bring lawsuits on behalf of the government and share in any recovery.  MCCCD has agreed to pay $4.08 million to settle the allegations.  In this case, the whistleblower will receive approximately $775,000 as her reward under the qui tam provisions of the False Claims Act.

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