Former HVAC school named in report of $300 million trade school fraud

A Washington Post report released Tuesday revealed that 20 for-profit trade schools that educate military veterans under the GI Bill have fleeced the federal government out of more than $300 million, including a former HVAC school in Texas that raked in $72 million over three years.

What’s happening: At Retail Ready Career Center in Garland, just outside of Dallas, owner Jonathan Dean Davis charged around $20,000 for a six-week “boot camp” that trained students to become HVAC technicians. 

• The tuition — “10 times what many Texas community colleges charged for an entire semester,” according to The Post — funded travel to and from school, as well as food and housing. From 2014 to 2017, the career center enrolled more than 3,500 veterans.

The big picture: The GI Bill is a set of federal programs, funded by the Department of Veterans Affairs (VA), that helps offset the costs of education and housing for veterans. 

• The bill generally covers up to 36 months of expenses for students enrolled in college or vocational school, with the VA now paying a maximum of roughly $31,000 annually in tuition at most schools. 
• Yes, but: There’s no standard for minimum course length, and the GI Bill doesn’t require trade schools to obtain academic accreditation. 

Zoom in: Unaccredited schools in Texas must receive certification from a state agency — the Texas Veterans Commission (TVC) — to be approved for funding under the GI Bill.

• However, due to lax oversight, per The Post, Davis was able to launch Retail Ready without meeting all of the requirements.
• He falsely claimed to the TVC that he had sufficient funds to operate the school, according to the U.S. Attorney’s Office, and falsely stated that Retail Ready had existed for two years. 

As the school succeeded, Davis spent lavishly, purchasing a $428,000 Lamborghini, a $282,000 Ferrari, and a $260,000 Bentley Continental GT, among other cars, as well as a $2.2 million Dallas mansion. He also acknowledged spending “under $200,000” at strip clubs.

What they’re saying: In documents obtained in a public records request by Veterans Education Success, several former HVAC students reported that the education was inadequate and that they were unable to obtain stable employment.

• “The Retail Ready Career is [a] scam,” one former student wrote in a complaint. “[A] six-week course that barely teaches you anything. The curriculum is not on a real schedule, the promises made to students are not kept.”

The other side: Some students, however, remember the education as a positive experience. 

• “I wouldn’t have gotten as far as I have without going through that school,” said Brandon Moulding, a Marine veteran from North Carolina, who has since launched a successful career as a service technician. 

Zoom out: In 2020, a grand jury convicted Davis on 11 counts of wire fraud and money laundering, finding that he had defrauded the VA by lying about the school’s finances. 

• One year later, he was sentenced to nearly 20 years in federal prison, ordered to pay $65.2 million in restitution, and required to forfeit $72.5 million to the federal government.
• “Mr. Davis’ crimes were a slap in the face to the sacrifices made by our servicemembers, and we are proud to put him behind bars for such a significant period of time,” Acting U.S. Attorney Prerak Shah said at the time. 

“In an interview with The Post from a minimum-security federal prison outside Dallas, Davis said he was wrongly convicted,” the newspaper wrote Tuesday. 

The bottom line: According to The Post’s report, 15 of the 20 trade schools investigated were unaccredited, and several similar schemes were uncovered.

• The federal government paid $2 million in GI Bill funds to a New Hampshire school for a $14,900, week-long course on how to grow grass.
• A separate New Hampshire school charged $18,500 a head for veterans to learn how to make concrete look like natural rocks, earning $17.8 million from the VA.