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Former Riverside technical school CEO gets prison for $105 million VA scam

July 1, 2023

The founder and chief executive officer of the defunct California Technical Academy in Riverside has been sentenced to five years in federal prison for scamming $105 million in the largest post-9/11 GI Bill fraud case at the Department of Veterans Affairs.

Michael Bostock, 54, of Nampa, Idaho, was sentenced Monday, June 26, in U.S. District Court in Washington, D.C. He previously pleaded guilty in September 2022 to one count of conspiracy to commit wire fraud.

Co-conspirators Eric Bostock, 48, of Riverside and Philip Abod are scheduled to be sentenced on Oct. 19 for their roles in the scheme at CTA campuses in Riverside, Temecula and Escondido.

Information was not immediately available regarding the relationship between Michael and Eric Bostock.

From 2012 to 2022, CTA received about $32 million in tuition payments and about $72.5 million in education-related benefits from the VA for 1,793 veterans enrolled at the school, according to a Department of Justice sentencing memorandum.

Bostock and the two other defendants falsely attested to CTA’s compliance with federal regulations mandating that no more than 85% of enrollees in an approved program could be VA-funded. Additionally, they lied to the VA about the enrollment of veterans in approved courses, class attendance and grades, prosecutors said.

To conceal their scheme, Bostock and the other defendants falsified veterans’ contact information by substituting phone numbers purchased in bulk that would ring a cellphone they controlled to ensure regulators could not contact the veterans.

“When regulators called the falsified phone numbers to obtain information about the school, the defendant and his co-conspirators would impersonate students,” says the sentencing memorandum

Bostock and his co-conspirators also faked records to make it appear veterans had completed CTA courses, when, in fact they had not, according to prosecutors.

The memorandum says Bostock fleeced the government to expand the two-year college and provide his wife, stepdaughter and brother with employment.

“This was not a one-off criminal episode or temporary lapse in judgment,” the memorandum states. “The defendant engaged in this fraudulent conduct to ensure that the VA would continue to provide funding to CTA.”

Individuals have filed anonymous complaints with the Better Business Bureau claiming that, after federal agents swarmed CTA, the school abruptly shut down and failed to reimburse them for enrollment fees and tuition-related expenses.

“My son was going to school there one day,” according to an individual, who said CTA owes them $4,369. “I went to drop him off (and) the FBI had all employees and students outside on the ground. I was terrified, I asked what was going on (and) the FBI agent could not give me any information.”

In a statement to federal probation officials, Bostock apologized for defrauding the VA.

“I accept full responsibility for my criminal acts,” he said. “There is no excuse for providing false information to the VA. It is particularly offensive that I abused the GI Bill. This law is designed to serve America’s military heroes. When I committed this crime, I betrayed my own values and disappointed countless people. I am very sorry I acted so recklessly.”

Prosecutors said Bostock’s remorse is “noteworthy,” but added that his history of traffic infractions and drug possession demonstrates his difficulty in following rules.

“The severity of and breadth of the fraudulent scheme that the defendant led, as well as the defendant’s prior criminal conduct, warrant giving significant weight to specific deterrence,” says the complaint.

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Former Riverside technical school CEO gets prison for $105 million VA scam

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