Feds Bust Alleged Immigration “Pay-to-Stay” L.A. Trade Schools

Thursday, March 12, 2015

Students who were signed up at Prodee University in 2011, the year Homeland Security agents began investigating the main campus in Los Angeles, probably would have graduated by now if anyone actually bothered going to classes.

But that’s not why they were enrolled.

The U.S. Attorney’s Office announced this week that three L.A. residents were arrested on federal charges for allegedly operating a network of four schools that let foreign students receive education extensions on their visas in exchange for “tuition.” The 21-count indictment returned by a federal grand jury alleges immigration fraud, money laundering and a bunch of other immigration offenses as part of a “pay-to-stay” scheme.

The schools allegedly issued Form I-20s, which indicate acceptance into a government-certified school as a full-time student, to foreign nationals who had no intention of attending the schools and often lived outside of Los Angeles. The school operators produced bogus student records and moved “students” who wished to remain in the country longer from one school to another. 

Six months of “tuition” cost up to $1,800 and allegedly netted the operators $6 million a year. The schools’ 1,500 students were largely Korean and Chinese. The indictment says the students had entered the country on F-1 visas from Homeland Security’s Student and Exchange Visitor Program (SEVP) and later transferred to the Prodee network.

Three of the schools—Prodee University/Neo-America Language School; Walter Jay M.D. Institute, an Educational Center (WJMD); and the American College of Forensic Studies (ACFS)—are in Koreatown. A fourth, Likie Fashion and Technology College, is in Alhambra.

The investigation began when a compliance team from SEVP dropped in on the Prodee campus for an unannounced spot check and found just three students. Prodee’s two campuses supposedly enrolled 900 students. A quick check that same day of ACFS found a single religion class with a lone student.   

Four years later, the feds indicted owner and manager Hee Sun Shim (aka Leonard Shim and Leo Shim) of Beverly Hills, Hyung Chan Moon (aka Steve Moon) of Los Angeles and Eun Young Choi (aka Jamie Choi) of Los Angeles. They face decades in jail if convicted.

According to a press release, Homeland Security will “be seeking to withdraw the schools’ SEVP certification, which will bar the institutions from enrolling foreign students.”

SEVP monitors approximately 1 million international students.

A report (pdf) from the U.S. Government Accountability Office (GAO) castigated Homeland Security’s U.S. Immigration and Customs Enforcement (ICE) in 2012 over its inability to assess “the fraud risks posed by schools that do not comply with requirements” for SEVP. The report found that, “ICE does not maintain records to document SEVP-certified schools’ ongoing compliance.”

–Ken Broder


To Learn More:

Scam U.? Feds Bust Alleged Student Visa Fraud Ring in LA (by Andrew Blankstein, NBC Los Angeles)

Feds: 3 Collected Millions in Fraudulent School Scheme (by Michael Martinez and Paul Vercammen, CNN)

Federal Agents Raid Suspected Fake Schools (by Miriam Jordan, Wall Street Journal)

Feds Allege Sweeping Immigration Fraud in L.A. Trade Schools (by Joseph Serna, Los Angeles Times)

Student and Exchange Visitor Program: DHS Needs to Assess Risks and Strengthen Oversight Functions (U.S. Government Accountability Office) (pdf)

Three Indicted for Operating “Pay-To-Stay” Schools That Allegedly Enabled Foreign Nationals to Remain in U.S. as Foreign “Students” (U.S. Attorney’s Office for the Central District of California)

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