In a move to resolve allegations of fraudulent claims, Five Point Enterprises LLC has agreed to pay over $2 million to the U.S. government. According to the Justice Department, the settlement of $2,049,159 is a response to the company's practices related to the Post-9/11 GI Bill education benefits which were found to breach federal regulations.
Based in Austin, Texas, until 2021, 5PE operated as a for-profit entity, providing vocational training through a partnership with New Horizons Inc. The allegations against 5PE claim that from 2015 to 2020, it knowingly violated the "85/15 Rule" by enrolling a disproportionate number of veterans into its courses, effectively undermining the program's quality assurance measures. Moreover, claims suggested that 5PE did not disclose to the VA the tuition reductions given to veterans, which is in direct violation of the "Last Payer Rule," as per the Justice Department's statement.
Amid the settlement announcements, Principal Deputy Assistant Attorney General Brian M. Boynton emphasized the imperative of integrity within the GI Bill program, "The Post-9/11 GI Bill educational assistance benefits are part of our promise to the brave women and men who have served our country. Today’s settlement demonstrates our commitment to safeguarding the integrity of this important program."
Joining the pursuit for accountability, U.S. Attorney Jaime Esparza for the Western District of Texas, pointed out the necessary protection of educational benefits for military veterans, "My office is committed to protecting the integrity of our federal programs and the education benefits military veterans and their families have earned by serving this country. We and our partners stand ready to hold accountable those who take advantage of them through fraudulent practices." Meanwhile, the Department of Veterans Affairs Office of Inspector General (VA OIG) indicated that their efforts to protect the program from abuse will persist.
Handling the matter involved the collaboration of several divisions within the government, including the Civil Division's Commercial Litigation Branch, the Fraud Section, the Western District of Texas U.S. Attorney’s Office, and the VA OIG. Although the payments made by 5PE will close the case on these allegations, the Justice Department noted that no determination of liability was established in the settlement.
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