Most of you are aware of CRI and the way it masqueraded as a viable court reporting school when in sobering reality it was merely a vessel to enrich the clever cronies who had ventured upon a clever scheme to separate vulnerable students from government money. Yes, government money. Strange is it not? If its government money, why does it belong to the students you might inquire? Well it belongs to the students because its the students who end up having to pay it back...and that's forever!
Actually Janisch was a bit more advanced than many of the unscrupulous school operators out there. He managed to swindle not just the students but the Department of Education itself, actually not that difficult. The Dept. of Education has a requirement that a school must meet certain financial standards in order to participate in the financial aid program which is literally the lifeblood of any proprietary school since the students do not pay the tuition for most of these schools, they just have to pay the tuition back. Janisch, in order to meet this requirement, engaged in a version of Three Card Monty, with his finances and those of two of his cohorts or elves if you will. The Dept. of Education requirements are not difficult to anticipate inasmuch as they appear at the end of the year regularly, a bit like Santa Claus. Thus, if a school has enough money at the time the DOE checks their finances then they are good to go. Its as if Santa Clause only checks if you're naughty or nice at the end of the year, ignoring your behavior during the rest of it. Read the summary judgment in the CRI bankruptcy case to get an overview of how this worked.
So Janisch, made sure that he had enough money, jewelry, letters of credit, or whatever negotiable instrument he could locate to satisfy the DOE's predictable journey through his books and then as soon as they turned the corner, simply repatriated what ever collateral his friends had loaned him and went on on about his crooked business.