Crown College Financial Fraud Case Update

There are many developments in the Crown College Financial Fraud indictment of the four former officers of Crown College. On July 26, 2010, Misty Lee pleaded guilty to counts 1 and 2 of the indictment pursuant to a plea agreement with the government which was sealed. The minute order of the hearing is here:

Minute Entry for proceedings held before Judge Karen L Strombom- CRD: Traci Whiteley; AUSA: Nick Brown; Def Cnsl: Colin Fieman; PTS: Todd Skipworth; Time of Hearing: 11:30; Courtroom: F; Session #: TAC100726 (SEALED); INITIAL APPEARANCE AND PLEA (via video conference) as to Misty Lee held on 7/26/2010. At the request of the defense and with agreement from the government, the Defendant is present via video conference from the Clerk's Office of the US District Court for the District of Kansas at Topeka. Defendant placed under oath and advised of rights/charges/ penalties; Defendant executes Consent to Rule 11 Plea in a felony case before a U.S. Magistrate Judge; Education = 2 yrs college; Court reviews the plea agreement; Pleas guilty to counts 1 and 2; Remaining Count to be dismissed at sentencing. Court finds the Defendant is competent to enter a guilty plea; Court signs the Report and Recommendation and Counsel have fourteen days to file objections; Court orders the preparation of a Presentence Report. Defendant remains "at liberty."

Sentencing set for 10/15/2010 at 10:30 AM in A Courtroom before Judge Robert J. Bryan. (TW)

Well the Misty Lee's sentencing was continued until the rest of the defendants could enter the pleas or go to trial and then followed a great deal of postponements as the defendants and prosecutors Next Sheila Mullineaux plead guilty and was sentenced because, apparently, she was not going to testify against the other defendants.

Crown College Ex-Officers Steal from You

As most are aware, Crown College ex-officers, former vice president, Sheila Mullineaux; the college's admissions director and registrar, Jesica McMullin; and financial aid director Misty Lee, and Jennifer Byers, the fiscal manager and bookkeeper were indicted by a federal court. Their arraignment was set continued from May 28 to June 11, 2010. On June 11, 2010 only Jesica McMullin appeared. The clerk clerk stated that the U.S. Attorney's office was inquiring as to whether they had received notice of the arraignment before taking further action.

This indictment will most likely not be news to many of the unfortunate students not to mention the even more unfortunate taxpayers. Actually one could argue, and I do, that Crown College and their staff have allegedly been stealing from the federal government for some time which is what happens when you lie to students about the transferability of credits. Those students do not receive the education they bargain for and are stuck in place and have wasted the taxpayers' money or they must continue their education in another school, again in determent to the taxpayer.

In reality, if these ex-officers are guilty, what they have done is simply dispense with the middle man, i.e., the students and stuck their hands directly into the public till. You see, the federal government and you gentle taxpayer fund higher education and for-profit schools through the grants and federal loans. Yes, the student is responsible, however, since the federal government guaranteed the loan, the taxpayer is on the hook.

Crown College Former Officers Indicted

Well as the Seattle PI reported four former Crown College officers were indicted for financial aid fraud. This would include almost the entire office staff: former vice president, Sheila Mullineaux; the college's admissions director and registrar, Jesica McMullin; and financial aid director Misty Lee and Jennifer Byers, the fiscal manager and bookkeeper. Well, it took three years, but justice has never been known for its speed and the truth is easily obscured and obfuscated. Crown College was always been a business and that trumped every other consideration, including educating and honesty. Most people think accreditation is accreditation. Unfortunately, it is not. There is national accreditation, which is basically conferred to vocational, career schools and regional accreditation which is conferred on academic institutions. In many cases, the credits don't mix, i.e., most academic institutions do not accept credits from Crown College and other nationally accredited schools. Now there is quite a debate as to whether this is fair or not, however, that issue never excused Crown College from being honest with their students. Instead, they complained about the unfairness of regional accredited schools not accepting their credits for transfer while at the same time, telling their students, that Crown's colleges credits transferred. No problem.

Let's take a trip back in time. Crown College's success and even existence was always intricately tied to the ability of its staff to convince students that its credits were transferable to academic institutions. So they lied to students, bold faced lies, and they were able to get away with it, for a long time.

Each of these former officers, that have been charged by the federal grand jury lied to students in order to keep Crown College in the black and in fact it brought in $4,000,000 at its zenith. Your tax money boys and girls, since the money comes from the federal government. As far back as 1997 a complaint was filed against Crown College complaining that that credits that Crown College officials stated would transfer did not. Lola Jackson finally brought a case against Crown College and they finally settled out of court. However, Latisha Gonzalez filed a lawsuit and then a class action lawsuit was filed and then the media became involved. John Wabel, who basically was Crown College, had no choice but to stake his entire reputation on defeating the Gonzalez suit. It's amazing to see how he refuses to even accept the possibility that his administrators could lie, which, of course it appears that they did.

The publicity generated by the class action lawsuit exposed Crown College's practice of lying about the transferability of their credits and then, after an epic judicial struggle, Crown College lost the Gonzalez lawsuit, was saddled with paying Gonzalez's attorneys $70,000 and an injunction which prohibited them from deceiving students. They settled a second law suit for $70,000 and then hoped to resume their "business" practices. However, stuffing a cat back into a bag is no mean task, especially with the indelible stain that the internet can leave, but I'm mixing metaphors. Suffice to say, that once students realized that the Crown College's credits did not transfer, they no longer wished to pay the premium fee to attend it. Community colleges were a much better deal.

Crown College was never able to recover despite an influx of money and a new round of advertisements. It was already all over the internet that the school's credits did not transfer. Thus, it was clear it was going to close and that is when these officers hatched this scheme.