Inmate uses Webster University to commit $467,000 student aid fr -

Inmate uses Webster University to commit $467,000 student aid fraud

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By KMOV Web Producer By KMOV Web Producer

(KMOV) -- A former inmate at a South Carolina correctional facility is likely headed to federal prison after admitting to a student financial aid fraud involving Webster University totaling $467,500.

Michelle Owens, 35, pleaded guilty Monday to one count of federal student financial aid fraud and one felony count of mail fraud.

Owens was confined to the Leath, South Carolina Correctional Institution from December 2007 to September 2008 for forgery and financial identity fraud. Owens worked in the prison's Education Department where she had access to the personal information of other inmates.  She used 23 different inmate identities to commit the fraud.

Here is how the U.S. Attorney's office described how her scheme worked.

According to court documents, from December 2007 to October 2009, Owens submitted online applications for admission to Webster University's distance learning program in the names of individuals who were inmates at Leath without their knowledge. 

Owens intended to use the financial aid funds for improper non-education purposes.

On those applications, Owens used several residential addresses located in South Carolina.  Based upon the information contained on the applications Webster University accepted the individuals and mailed the letters to South Carolina.  Additionally, Owens falsely applied for federal student financial aid on behalf of the inmates by completing the Free Application for Federal Student Aid (FAFSA) either by computer over the internet or by paper application using the inmates personal information. Once Webster University received the required supporting documentation, they created a financial aid package for that "applicant" and mailed the award notification to the same South Carolina addresses controlled by Owens.

Owens received the excess financial aid intended for the inmate “applicants”  through Higher One, Inc. in the form of debit/MasterCard cards which she cashed or used for personal expenses totaling $124,821.

Student financial aid fraud carries a maximum penalty of five years in prison and possible fines up to $20,000. Mail fraud carries a maximum penalty of 20 years in prison and fines up to $250,000.



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