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Schools Closed in Alleged Fraud

Immigrants paid hundreds of dollars to be taught that there are 53 states in the union.

August 06, 2004|Jason Felch | Times Staff Writer

A chain of alternative high schools accused of selling phony diplomas has taught thousands of immigrants that there are 53 states in the union, four branches of government and two houses in Congress -- one for Republicans and one for Democrats.

Federal agents on Thursday raided the offices of California Alternative High School, based in Huntington Park, after Atty. Gen. Bill Lockyer obtained a court order to freeze the school's assets.

Among the items seized was the school's 54-page curriculum, which taught students that the Treasury Department was part of the "administrative" branch of the government, and that the flag had not yet been updated to reflect the nation's 53 states.

According to court records, the school has given worthless diplomas to students after just 30 hours of instruction. It charges students, mostly Latinos, $450 to $1,450 for the 10-week course.

The school claims 77 locations nationwide and says 1,500 students graduate every 10 weeks, according to state officials. The victims could number in the tens of thousands, officials said.

A civil suit Lockyer filed Monday names three corporations and six people, including school Director Daniel Gossai of Rancho Palos Verdes and his wife, Janet. The couple could not be reached for comment.

The defendants "made a lucrative career of exploiting immigrants' dreams of a better life through education," according to a request for a temporary restraining order that was granted Wednesday. They used community churches to solicit students and hold classes, according to the records, and claimed to be "fulfilling a divine mission to help Latinos escape poverty by earning a high school education."

Lockyer said the "scam is especially disturbing because it shatters dreams" by taking advantage of people hoping to acquire knowledge and improve their lives.

Rose Serrato, a 52-year-old Pacoima resident, paid $475 to enroll in the course in February after learning she needed a high-school equivalency diploma, or GED, to keep her part-time job with the Los Angeles Unified School District.

After two classes, she said, she had doubts about the program. She asked her daughter to look up the school on the Internet, and both were convinced by the website they found that the school was legitimate.

"I thought it was a way to get a GED quickly," Serrato said.

According to court records, instructors spent class time reading questions aloud from the workbook and giving students the answers.

"It was all too easy," said Josefina Roa, who attended with Serrato. "They didn't make us think. They gave us all the answers."

The school promised a diploma to students who spoke no English, and most instruction was in Spanish. Serrato, who speaks Spanish but doesn't read it, said she had to request an English version of the workbook.

When the course ends, graduates are required to rent a cap and gown and participate in a graduation ceremony to receive their official transcripts, court records said. Gossai often gives the commencement speech, and another school official translates it into Spanish.

The school claims to be authorized by the state and affiliated with Los Angeles Unified. Its brochures imply that graduates are "eligible for admission to accredited colleges and universities" and "eligible to receive state and federal financial aid," court records said.

Gossai claims to hold a "lifetime credential from the state of California" to teach at the community college level, but court records say he was dismissed from the Victor Valley Community College District "on grounds that he engaged in immoral conduct."

The court order also freezes the Gossais' assets related to the school, including eight bank accounts, five cars, their Palos Verdes Peninsula home and six other properties in the Los Angeles area. Court records say the couple tried to hide assets by manipulating the title to property and placing funds in Gossai's wife's name.

The lawsuit also names David Soto, president of West Side Education Corp., which bought the rights to operate school sites; Nel Brito, director of an affiliated school; Fabricio Sandoval, director of admissions; and Janira Jacobs, a teacher and administrator.

Thursday's raid was the result of a two-year investigation by local, state and federal authorities.

Authorities in Iowa and Nebraska also have taken legal action against the school in the last year.

The civil suit seeks restitution for victims, $32 million in civil penalties and an end to allegedly illegal business practices.

The court order named attorney David J. Pasternak to run the school until the civil suit is decided.


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Workbook examples

According to court papers filed by the California attorney general's office, the California Alternative High School's 54-page bilingual workbook contains the following statements:

* There are 53 states in the United States. In addition to the "original" 50 states, the union has added Alaska, Hawaii and Puerto Rico. But the flag has not yet been updated to reflect the addition of the last three states.

* There are four branches of government. They are the legislative, judicial, executive and "administrative" branches. Asked about the fourth branch by investigators, one teacher responded that "not much is heard about it because it works behind the scenes." The Treasury Department is part of the "administrative" branch.

* There are two houses of Congress: the Senate for Democrats and the House for Republicans.

* World War II occurred from 1938 to 1942.

* One question in the workbook says: "Read the book 'Death of a Traveling Salesman' and write a commentary."

Source: California attorney general's


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