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MIT Alumnus Pleads Guilty to Loan Fraud Miller Faces Up to Five Years in Prison, Fine

By Dan Kane

Former North Carolina state Rep. Paul Miller ’82 pleaded guilty Tuesday in federal court to a fraud charge that was related to his attempts to avoid paying $23,000 in overdue student loans.

Miller, a three-term Democrat from Durham, faces up to five years in prison and a $250,000 fine for the felony crime. He is scheduled to be sentenced Dec. 8 in the same federal courthouse in Winston-Salem where he entered his guilty plea.

In June, federal authorities accused Miller of doctoring personal checks to convince officials with the U.S. Department of Education that he had paid off federally backed student loans that he obtained while he was a student at MIT. Authorities found that in early 2005, Miller had taken five $100 checks written for loan repayment in 1992 and altered them to look as if each were made out for $4,100.

Miller, 47, who had already decided not to seek re-election, stepped down from his seat in July. He was replaced by Larry D. Hall, a lawyer and community activist who won the Democratic primary for the seat. Hall faces no Republican opposition in the general election.

Assistant U.S. Attorney Harry Hobgood said that he dropped the other fraud count as part of the plea agreement. He said that Miller will likely face a much lower sentence than the five-year maximum. Miller had paid back the $23,000 before he was charged.

Miller signed the plea agreement Aug. 23, a few weeks before the case was to go to trial.

Miller could not be reached for comment. His attorney, Christopher Fialko of Charlotte, said in a prepared statement, “After more than 40 years of being a good student, professional, father and legislator, Paul made a mistake. He has accepted responsibility for it, and is looking forward to the resolution of the case.”

Miller, a former Durham City Council member, identified himself as a computer consultant and an investment adviser at different times during his years in the House. In 2004, he drew criticism for missing more than half the legislative session while collecting $104 per day for expenses such as food and transportation.