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The Suburbanite
  • Carnegie Career College officials face federal indictment

  • Almost two years after FBI agents and the U.S. Department of Education raided Carnegie Career College, a federal grand jury has indicted the school's founders and an employee on charges they conspired to steal millions in federal financial aid dollars
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  • Almost two years after the FBI raided Carnegie Career College, a grand jury has charged the school's founders with conspiring to steal $2.3 million in federal student aid and spending some of the money on property, jewelry and vacations.
    The FBI arrested John Richard Ceroni, 64, and Adale Marie Ceroni, 62, both of Canton, on Thursday. They remain in custody following a hearing in U.S. District Court in Cleveland where they denied charges of conspiracy to commit mail and wire fraud, money laundering conspiracy and four counts of engaging in a monetary transaction in property derived from unlawful activity.
    John Richard Ceroni also denied a single charge of making a false statement to a federal agent.
    A third defendant, Carnegie employee Tammy Pyle, 43, of Waynesburg, is also charged with conspiracy to commit mail and wire fraud. Records indicate she hasn't yet appeared in court, nor was her attorney listed.
    A hearing is scheduled for Monday where the Ceronis' attorneys are expected to argue for their release pending trial.
    "We did not defraud the government, they did not defraud any financial institutions and the money that they derived was legitimate funds," said Donald Malarcik, the attorney for Adale Marie Ceroni.
    A call seeking comment was left for an attorney representing John Richard Ceroni.
    The charges are serious: The mail and wire fraud charge by itself carries a statutory maximum of 20 years, Malarcik said.
    Federal prosecutors also are seeking a monetary judgment against the defendants in the amount of $2.3 million, as well as forfeiture of Carnegie's building at 1320 W. Maple St. and more than $400,000 in cash seized from various bank accounts.
    The case is assigned to Judge Patricia A. Gaughan.
    ALLEGED SCAM
    In December 2011, FBI agents and the U.S. Department of Education confiscated thousands of records from Carnegie's North Canton branch and its main campus at 1292 Waterloo Road in Portage County's Suffield Township.
    John Richard Ceroni was the dean and director of education. Adale Marie Ceroni was the school's director. Both are commonly known by their middle names.
    According to the federal indictment unsealed Thursday, Carnegie recruited students who didn't have a high school diploma or GED by falsely claiming those students could get a valid diploma while attending the college and receiving financial aid.
    The defendants then obtained fake diplomas from "online high schools," such as Adison High School, an entity registered in Australia, according to the indictment.
    Federal prosecutors allege the Ceronis got more than 140 fake diplomas. Pyle participating in the conspiracy by taking an online diploma "test" for some students, and providing "test" answers to several others, according to the indictment.
    Page 2 of 3 - The Ceronis used the diplomas to fraudulently obtain $2.3 million in federal student aid between 2007 and 2011, money that was intermingled with legitimate student aid, according to the indictment.
    The Ceronis and other Carnegie instructors claimed to be unpaid volunteers, but authorities say the staff was paid under the table. The Ceronis also used financial aid money to pay off personal debts, run related businesses, take vacations, and buy vehicles, lingerie, property and jewelry for themselves and others, the indictment alleges.
    SCHOOL CLOSED
    After the raid, the school gave students the chance to finish their studies, then closed, Malarcik said.
    Signs outside the North Canton building Thursday identified it as Applied Job Placement and The Massage Center. About 20 vehicles were in the lot, including several that were snow-covered, indicating they had been parked there over night.
    An employee said the operation "used to be a school" but now is "just a massage center." The employee said she knows the Ceronis, but was unaware of any criminal charges being filed against the couple.
    The Ceronis started the Institute of Integrative Medicine and Massotherapy as a not-for-profit about 13 years ago. That entity did business as Carnegie Institute of Integrative Medicine and Massotherapy before becoming Carnegie Career College in 2010.
    The school held itself out as a private not-for-profit college and in early 2004 qualified to receive federal student aid.
    The Cernonis initially held classes at a church building in Suffield that housed Historical Chapel Ministries, another entity associated with the couple. Carnegie opened a branch in 2007 in a single-family home in Canton, before moving to North Canton in 2010.
    The school offered associate degrees in rehabilitation massage therapy, chemical dependency counseling and forensic science, as well as certificate programs medical assisting.
    Tuition for degree programs was around $12,500, while a certificate cost almost $7,000, according to the school catalogue in 2011.
    The Department of Education put Carnegie under greater scrutiny in March 2008 after a program review noted administrative errors and concerns, according to the indictment.
    Three years later, a Stark County judge raised questions about the authenticity of an Adison diploma obtained by a man who was on probation.
    Malarcik said he has been in contact with the U.S. attorney's office since the raid and that the charges were not a surprise to himself or his client.
    He also said there are a number of colleges and universities that accept Adison diplomas.
    A student adviser who answered the phone at Adison's toll-free number and gave his name as Jasper McCalister said the online school is based in Houston, Texas, and doesn't give fake diplomas.
    Reach Shane at 330-580-8338
    Page 3 of 3 - On Twitter: @shooverREP
    Repository staff writer Edd Pritchard contributed to this report.