Overview
- Former executives Dave Phillips and Ben Chaib filed the qui tam case in June 2024, and it was unsealed in May 2025 after the Department of Justice declined to join.
- The complaint claims LAFS financed thousands of short-term gigs to meet a 70% placement benchmark, including nearly $1 million paid from 2010 to 2017 to Ivar Music Group and others for two-day jobs.
- Plaintiffs allege the school misled Education Department auditors in 2017 and concealed an illegal incentive-compensation program tied to student enrollment.
- LAFS denies the allegations, calling them time-barred and previously investigated and settled by the Department of Education from 2017 to 2020, and the school is expected to move to dismiss the suit on Oct. 1.
- The complaint cites about $85 million a year in federal assistance to LAFS and names affiliated Full Sail University and owner James "Bill" Heavener as defendants, noting Full Sail reportedly receives about $377 million annually; LAFS’ accreditation was renewed in 2023 for five years.