New College Independent Alumni/ae Association

The US Department of Education letter and supporting documents dated March 6, 2008  contain no surprises that I can decipher. They do, however, confirm my suspicions about why responsible parties like Financial Aid Director Renee M. Stonework bolted last summer faster than a quarter-miler at Santa Anita, leaving people like long-time Business Manager Carol Small holding the bag.

Most of the supporting docs are either related to federal rules and regulations governing student loan funds, or bank statements from one of the three banks used by New College during the final year of its demise. Perhaps of note from a bank statement dated July 31, 2007 (when the you-know-what hit the fan) are the names of Martin Joseph Hamilton and Peter J. Gabel on the Student Loan Account. (Just so we don’t forget who the responsible parties were should a federal investigation turn up criminal conduct.)

Speaking of which, there is one other item of interest in the U.S. Department of Education packet, and that is this:

WARNING: Any person who knowingly provides false or misleading information on this certification will be subject to a fine of up to $10,000 or to imprisonment of up to 5 years or to both under the provisions of the United States Criminal Code, Title 18, Section 1001.

I just read the DOE letter of revocation from March 6, 2008, and I can see why they opened an investigation. The school at that time was missing a quarter million dollars in student loan funds from the current cycle, and this was at a time when they were already on WASC probation following their special investigation.

This tip of the iceberg would definitely whet the appetite of an inspector.

I also notice that DOE copied their letter to WASC as well as the Department of Consumer Affairs, which I believe is housed in the California Department of Justice, headed by California Attorney General Jerry Brown.

Looking over the San Francisco Superior Court filings for August, it appears about 115 former employees of the school filed claims as substantiated by the Department of Labor in July. While most of these claims for back wages fall in the under $25,000 range, a few notable exceptions apply to vice presidents, special assistants and friends of Peter Gabel involved in the conning of WASC, defrauding the Department of Education, harassing whistleblowers, sabotaging the reform efforts, as well as the subsequent cover-up.

Mildred Henry is seeking $95,000; Michael McAvoy $75,000; Kathy Voutyras $63,000. And as noted previously, the mastermind of the mess, Matthew Wilkes, is asking $72,000.