Embattled Riverside County Christian college under investigation for fraud, money-laundering

An Anza-based Christian college with satellite schools across the world has been the target of a three-year federal investigation triggered by a frantic 911 call to Riverside County authorities from a student who claimed she had not been allowed to leave the campus for months.

Homeland Security Investigations, a division of U.S. Immigration and Customs Enforcement, launched its investigation into Olivet University in 2019 in partnership with the Riverside County Sheriff's Department and District Attorney's Office. The focus of the probe has reportedly been fraud, money-laundering and labor trafficking.

Additionally, the university's New York campuses were shut down following criminal convictions there for defrauding lenders and links to a $35 million money-laundering scheme.

The school was founded in Los Angeles and Seoul, South Korea, in 2000 as Olivet Theological College and Seminary by Korean American pastor David Jang. In 2014, the university purchased its 1,000-acre site in Anza, a former laborer training school, setting up its headquarters and fulfilling a vision, university President Matthias Gebhardt said.

"The goal was to always have a large campus," Gebhardt said during a tour of the snow-dusted campus on Tuesday, Dec. 13. He said the property, located in the San Jacinto Mountains halfway between Temecula and Palm Springs, was an ideal location for Olivet — large enough for student housing and much cheaper than property in the Bay Area, where the university was incorporated in 2004.

The school attracts students from all over the world, mainly China, and offers full scholarships to prepare students for missionary work and ministry. About 70% of Olivet's students, 40% of whom are from overseas, are enrolled in the school's master of divinity program, Gebhardt said.

Asked why so many of its students were from overseas, Matthias said, "This is how ministry grows."

Federal probe

Locally, Olivet's troubles can be traced to the 911 call made at 11:03 p.m. March 27, 2018, by Rebecca Singh, a 22-year-old student who immigrated to the U.S. from India to attend the university. According to a sheriff's dispatch report, Singh said she was living in a camper on the Anza campus and had not been allowed to leave for months.

Singh also told the dispatcher there were "300 Asian men and women" living five to six people to a room in campus buildings.

By the time a sheriff's deputy arrived, however, Singh was already gone. In the interim, she had also called Olivet's former kitchen manager, Melissa Sims, whom Singh befriended when Sims worked at the school. She told Sims she was being held captive on campus and needed to be picked up.

Sims, fortunately, still had the Olivet's gate access code.

Extraction

In a telephone interview, Sims said she drove to the school, punched in the code at the entrance gate and then drove to the dorms about a half-mile up the road, where Singh — crouched in some bushes — spotted her, ran to the car and got in.

Sims said she brought Singh back to her Anza home, where she stayed a few days until Singh's mother could arrange to fly Singh to her sister's home in Boston.

"We took her to the airport in Palm Springs. She got on the plane and went to Boston to be with her sister, I believe," said Sims, an Anza resident for 19 years. "From what (Singh) told me, they locked her in her room for a long period of time and she wasn't able to do anything. They brought her food and were trying to get her to stay."

Olivet denies the allegations. Gebhardt said he could not comment further, other than to characterize Singh's claims as "outrageous."

Singh could not be reached for comment. Her mother, Shirley Singh, did not respond to a request for an interview.

Sims said several other students managed to flee the campus and complain to the authorities about their treatment. Some of the students, according to Newsweek, said they had been offered full scholarships to attend the school, but when they arrived at the remote Anza campus they were informed that they owed the college money and had to work to pay off their debt.

Food scarcity

Sims said that during her employment at Olivet, which began in 2017 and lasted about a year, she complained to university officials about food scarcity and how students often complained of hunger pangs.

She said she wrote a letter to university officials pushing for them to increase the weekly food budget. The campus had no vending machines or a cafeteria open during school hours, Sims said. Students sometimes subsisted on meager portions of rice and vegetables, she said.

"I just remember it was really hard trying to feed them," Sims said. "I fought for them to have a proper diet."

Gebhardt did not respond to a request for comment about Sims' allegations.

Campus raided

In April 2021, special agents with Homeland Security Investigations and Riverside County sheriff's and district attorney's investigators served a search warrant at Olivet. The warrant remains under seal, and the government has not disclosed any additional information since then.

In April 2022, a former senior DHS official who was briefed on the case told Newsweek that federal agents were looking for any evidence of "force, fraud or coercion" in relation to international students, primarily ones from China and South Korea.

Richard Beam, a Homeland Security spokesman in Los Angeles, would neither confirm nor deny if investigators were seeking such evidence during the raid. He said the probe is ongoing.

Gebhardt said investigators have not interviewed any administrators or students, as far as he knows.

New York convictions

In February 2020, Olivet pleaded guilty in New York to one count of conspiracy and falsifying business records in a scheme to fraudulently obtain $35 million from lenders.

Olivet's former board chairman, Andrew Lin, also pleaded guilty to one felony count of a scheme to defraud but averted jail time. He was sentenced to 200 hours of community service, said Kay Nguyen, a spokesperson for the Manhattan District Attorney's Office.

Olivet was ordered to pay $1.25 million in forfeiture over two years, while Lin agreed not to serve in an executive or managerial capacity at Olivet during that time.

Also convicted in the case were Etienne Uzac, former co-owner and chairman of IBT Media Inc., which for a time owned Newsweek magazine, and William Anderson, former CEO of Christian Media Corp., or CMC.

Uzac and Anderson each pleaded guilty to money laundering and a scheme to defraud for their roles in fraudulently obtaining the more than $35 million in financing for IBT, CMC and Olivet, according to the Manhattan District Attorney's Office.

Uzac and Anderson, according to New York state prosecutors, laundered the money through a network of corporate bank accounts to mask the origin of the funds and to disguise the fact that they were not being used to purchase equipment.

The majority of the money, according to prosecutors, was used to purchase land in New York and California and fund the day-to-day operations of Newsweek Media Group, CMC and Olivet. Uzac and Anderson used some of the money to make monthly payments on previously received financing to help conceal their scheme from lenders.

Olivet met the terms of its plea agreement when it paid the $1.25 million in forfeiture, and therefore, under the terms of its plea agreement, the felony conviction was withdrawn in February and a misdemeanor plea was entered, Nguyen said in an email.

Lin stepped down from Olivet's Board of Trustees in 2020 and has not been involved with the university since, Gebhardt said.

Accreditation issues

Olivet also has been tasked with proving to the state of California and its accrediting agency, the Association of Biblical Higher Education, that it is operating to agency standards.

Last month, the ABHE placed the university on warning status through February 2024 for failing to demonstrate "integrity in all of its practices and relationships with strict adherence to ethical standards and its own stated policies," according to the agency's Nov. 9 letter to Gebhardt.

The ABHE also criticized Olivet for failing in "honest and open communication" with its accrediting, licensing and governing agencies and compliance with legal and governmental regulations.

Olivet's failure to resolve the deficiencies could result in action ranging from an extended warning status to withdrawal of its accreditation. An ABHE evaluation team is planning to inspect the school in spring 2023.

Gebhardt said the ABHE, while determining Olivet has weaknesses, also found the university to be in "substantial compliance" with ABHE accreditation standards.

"Olivet University has identified areas of improvement already and is working diligently towards implementing them this year or early next year," Gebhardt said.

State action

In February 2019, the state Bureau of Private Postsecondary Education, a division of the Department of Consumer Affairs, slapped Olivet with a notice to comply after the college failed to provide it with essential student data for tuition recovery. The university, according to the notice, failed to provide student identification numbers, email addresses, mailing addresses, courses enrolled in and the cost of the courses, among other things.

Olivet subsequently provided the state with the information and paid a $5,000 fine. Olivet is now in good standing with the state.

"Payment of the fine as well as compliance with the order of abatement is considered final resolution," Cheryl Lardizabal, citation analyst for the BPPE, said in a letter to Olivet in April 2020.

On Dec. 2, 2022, the BPPE approved Olivet to provide dozens of courses at its school and continue offering bachelor's, master's and doctorate degrees. Many of the courses are offered in partial Korean, Chinese and Spanish.

New York shutdown

Unlike in California, Olivet did not have such success maintaining operations in New York.

In a May 17 letter to Gebhardt, the state education department informed him it would not recommend renewal of Olivet's permit to operate. The agency said the school was operating with insufficient resources, failing to responsibly administer institutional policies and programs, and had not established or enforced explicit policies with respect to working conditions.

Additionally, the education department noted other issues at the school, including tax liens, civil lawsuits for defaulting on contracted payment terms, failure to pay workers' compensation insurance, and the criminal case, all of which showed a "pattern of mismanagement of the institution's finances."

Olivet's appeal of the decision was denied and its permit to operate expired on July 1, 2022.

War with Newsweek

Much of the Olivet story has been fueled by Newsweek, a New York-based weekly online news magazine that confirmed its co-owner, Johnathan Davis, is still a member of Olivet World Assembly and that company CEO and President Dev Pragad is a former member of the "Olivet sect."

Olivet attributes Newsweek's aggressive reporting to an agenda by Pragad over a company shareholder dispute involving Davis. Davis also is the CEO of IBT Media. His wife, Tracy Davis, is Olivet University's former president and was serving in that capacity when Olivet and Lin were convicted in New York in 2020.

Tracy Davis no longer works for the university, Gebhardt said.

"We are in active litigation with Newsweek's executive team and you should presume that their reporting does not have any factual basis, and is purposefully damaging the reputation of our university," Gebhardt said in an email. "We have been working with our regulators to set the record straight and the courts to defend our reputation, and will continue to do so."

Nancy Cooper, Newsweek's global editor-in-chief, said in a statement: "We've been accused of being a partisan actor in the shareholder dispute because we've committed resources to covering a little-known Christian sect whose latest troubles have drawn scant attention from other media outlets.

"If these controversies had no connection to Newsweek's owners, we'd likely not cover them either. But it's crucial for us to report on our proprietors. We absolutely cannot be in the position of knowing about law enforcement activity related to the company and failing to report on it," Cooper said.

On a mission

Despite its setbacks in recent years, Olivet continues to operate in California and is working to expand its student base, which Gebhardt said has only ranged from 80 to 100 students in the past five years. Gebhardt attributes the school's minimal enrollment to funding limitations. It does not receive an endowment and depends largely on donations.

"We don't have a large pile of money gathering interest," Gebhardt said.

The school offers 32 programs and dozens of courses, and is pushing to start civil engineering, agriculture and architecture programs, Gebhardt said.

Olivet also has a K-12 school at its Anza campus, Olivet Academy, which Gebhardt said is accredited by the Association of Christian Teachers and Schools, or ACTS. During the recent tour of the campus, a throng of children, most of faculty members, scampered about in the chilly, crisp December air, playing basketball and working on an art project.

Gebhardt emphasized that Olivet's mission is to prepare its students for global ministry work — what he calls "church planting."

Nate Tran, Olivet's board chairman, said the many programs and courses Olivet offers its students — business, journalism, graphic design, information technology, etc. — are aimed at providing students special skills to accompany them in their mission work.

"Whatever the student learns here, they take with them, wherever they do their ministry," Tran said.

Phoebe Sun, a student at the school for the last six years, sat at a desk in the school's information technology center, working on a TikTok video presentation.

"I feel God has called me to ministry," said Sun, 36, of Yunnan, China.

She said she came to the U.S. to attend Olivet in 2015, earned her bachelor's degree in journalism in 2020 and is now working on her master's of divinity.

"It's a home to me," she said. "I feel God opened a door to reach outside the world."