San Diego Indian Couple Nimesh Shah and Nidhi Shah Sentenced for Defrauding the VA

October 27, 2020 - San Diego Indian Couple Nimesh Shah (37), owner of Blue Star Learning Technical Training School, and his wife Nidhi Shah (35) sentenced today for defrauding the Department of Veterans Affairs (VA) out of almost $30 million in G.I. Bill Education Benefits.

While Nimesh Shah was sentenced to 45 months in custody, his wife Nidhi Shah was sentenced to two years of probation by federab.

Besides the 45 months custody, Nimesh Shah was ordered by court to forfeit $3,076,361.77 and to pay the VA $29,350,999 in restitution.

According to court documents:
...from March 2016 to June 2019, he devised a scheme to defraud the VA with regards to Post 9/11 G.I. Bill benefits. Specifically, although Shah knew that close to 100 percent of students at Blue Star Learning were veterans receiving VA educational assistance, Shah repeatedly misrepresented to the California State Approving Agency for Veterans Education (CSAAVE) and the VA that Blue Star Learning was in compliance with the 85/15 Rule. In order to deceive CSAAVE and the VA, Shah created, and directed at least three other employees at Blue Star Learning to create, fake student files for the purported non-veterans in each program. Shah additionally emailed the VA 48 fraudulent enrollment agreements for fictitious people he represented were non-veteran students at Blue Star Learning, complete with fraudulent dates of birth, social security numbers, addresses, phone numbers and emails for each fraudulent non-veteran student.

...Blue Star Learning additionally had to provide vocational attainment data to CSAAVE on a yearly basis, as part of a required yearly approval process.

....Shah knew that the vast majority of Blue Star Learning graduates did not obtain jobs in the fields in which they were purportedly receiving training, and that the employment statistics on Blue Star Learning’s website were fraudulent.

...Shah nonetheless submitted fraudulent spreadsheets to CSAAVE claiming that all of the Blue Star Learning students listed were employed in the informational technology field. On these spreadsheets, Shah provided fraudulent phone numbers, email addresses, employers, and employer contact information for each student. Shah hired individuals to create the fraudulent email addresses for the Blue Star Learning students, and directed these individuals to answer emails received at the fraudulent email addresses pretending to be satisfied Blue Star Learning graduates working in the information technology field. Shah additionally created 30 fictitious companies that he listed as the employers on the fraudulent spreadsheets, and hired individuals to create fraudulent email addresses and domain names for each fictitious company. Shah directed a Blue Star Learning employee to purchase 30 cellular telephones, one for each fictitious employer, and had employees of Blue Star Learning create voicemails on each cellular telephone so that it would appear that the fraudulent businesses were legitimate if CSAAVE called to check.

As a result of Shah’s fraud, the VA issued over $11 million in tuition payments to Blue Star Learning, and over $18 million in housing allowances and stipends. In total, the VA lost $29,350,999.
San Diego Indian couple Nimesh Shah and Nidhi Shah pleaded guilty to one count of wire fraud and one count of making false statement respectively on November 13, 2019.