Six Charged In Conspiracy To Defraud Veterans And VA Of Nearly $20 Million In GI Bill Benefits

Orlando, Florida - United States Attorney Gregory W. Kehoe announces the return of an indictment charging Zachary Somers Hiscock (41, Arizona), Timothy Slater (66, Illinois), Nikhil Patel (48, Missouri), Gangadhar Bathula (59, Virginia), and Arif Hasan Sayed (54, California) with one count of conspiracy to commit wire fraud and ten counts of wire fraud. If convicted, each faces a maximum penalty of 20 years in federal prison on each count. A sixth conspirator, Kyle Blake Kotecha (38, Apopka), was charged by information and signed a plea agreement for his role in the conspiracy.

According to the indictment, Hiscock, Slater, Patel, Bathula, and Sayed conspired with Kotecha to violate the U.S. Department of Veterans Affairs (VA) regulations that prohibit predatory practices targeting veterans for their GI Bill tuition benefits. As a result of this conspiracy, Hiscock, Slater, Patel, Bathula, Sayed, and Kotecha defrauded the VA and veteran students of millions of dollars of their hard earned GI Bill benefits.

Hiscock, Slater, Patel, Bathula, and Sayed operated for-profit, non-college degree schools across the United States. These schools purported to provide courses in cybersecurity and computer coding and were approved to receive GI Bill benefits.

VA regulations prohibit schools that receive GI Bill benefits from compensating individuals who recruit and enroll veteran students with a portion of the tuition they secure. Despite this ban on commission-based recruitment, Hiscock, Slater, Patel, Bathula, and Sayed hired Kotecha to target and recruit veteran students to attend their schools and paid Kotecha approximately 25 percent of the benefits the schools obtained through the veteran students that Kotecha enrolled. The defendants undertook various efforts to conceal and obfuscate the nature of this recruitment from VA auditors, including by using coded terms, concealed payments, backdated and falsified contracts, and phony enrollment records. Some of the schools created false records of attendance of non-veteran students to legitimize and disguise the dramatic increases of veteran enrollments.

Kotecha's recruitment scheme was successful and pumped millions of dollars of GI Bill benefits into schools that had previously received little to none. The schools charged veterans tuition at or near the annual cap of $24,000 for instruction that lasted only 8 to 13 weeks. A small fraction of the veteran students went on to seek or obtain any certifications in programs purportedly taught.

The schools are charged with forfeiting $19,232,390 of GI Bill benefits fraudulently obtained as a result of the conspiracy. Kotecha has agreed to forfeit $3,965,264.34 to the United States as an estimate of the amount he personally obtained from the scheme.

"These charges serve as stark warning to those who would defraud the Post-9/11 GI Bill education benefits program," said Special Agent in Charge David Spilker with the Department of Veterans Affairs Office of Inspector General's Southeast Field Office. "The GI Bill has served millions of veterans since World War II and the VA OIG, along with our partners, will aggressively investigate fraud committed against this vital program."

An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.

This case was investigated by the Department of Veterans Affairs, Office of Inspector General. It will be prosecuted by Assistant United States Attorneys Noah P. Dorman and Dana E. Hill.