The U.S. Justice Department announced that it was accusing Stevens-Henager College and its owner in a civil lawsuit of illegally compensating recruiters. The college and its owner, The Center for Excellence in Higher Education, are alleged to have "falsely certified compliance with provisions of federal law that prohibit a university from paying incentive-based compensation to its admissions recruiters based on the number of students they recruit," according to the DOJ news release. The college and its owner are denying wrongdoing, and the lawsuit is pending. Under the federal False Claims Act, two former employees of the school who were "whistleblowers" and reported suspected wrongdoing to the government stand to receive financial rewards if the government is successful in recovering money previously paid to the college in the form of federal student aid. If you have concerns about possible wrongdoing at a school that you wish to share with an attorney, complete this form or call 877-540-8333 to contact the attorneys who operate www.collegewatchdogs.net.
A substantial jury verdict against a for-profit school in Minnesota has been upheld by a judge. As reported in the Huffington Post, a Minnesota judge not only refused to set aside a jury verdict of $395,000 against Globe University, but also awarded $500,000 in attorney's fees to be paid by the school.
The lawsuit was filed against the for-profit school by a former dean, Heidi Weber, who claimed she had been fired for complaining to the school about use of false job placement statistics and other misconduct.
The Huffington Post reported:
"Weber's suit claimed that Globe had violated a state whistleblower law when it fired her from her job as dean of the school's medical assistant program. The Washington County, MN, jury concluded that Weber was indeed fired in 2011 for raising with management that Globe was providing false information to students about placement rates, starting salaries, and the school's accreditation; failing to provide adequate training for students; and improperly paying commissions to school recruiters. The jury awarded Weber $205,000 for lost wages and $190,000 for emotional distress.
"Globe runs 11 campuses in Minnesota, Wisconsin, and South Dakota and has more than 10,000 students. From 2011 to 2012, the company obtained more than $170 million from federal student aid. More than half of Globe's students drop out without graduating; on some campuses, three-quarters drop out."
Questionable representations about job placement are a recurring problem at for-profit colleges and trade schools. If you are an employee or student at a for-profit school with concerns about representations made to students at the school that you wish to discuss with one of the attorneys operating this College Watchdogs site, call us at 877-540-8333, or complete this form.
A new system aimed at making it easier for veterans and military service members to file complaints regarding deceptive practices by for-profit colleges is up and running. As reported in the Huffington Post, the new portals for complaints are the result of a collaboration involving the Department of Education, the Department of Justice, the Department of Veterans Affairs, the Department of Defense, the Consumer Financial Protection Bureau, and the Federal Trade Commission. Numerous investigations have revealed that for profit colleges have engaged in widespread abuses of vets and military families.
A California-based for-profit school suddenly closed recently, marking the latest example of students and faculty being blindsided by the shuttering of a school with accreditation and financial aid troubles.
The Los Angeles Times reports that Career Colleges of America abruptly closed on January 9, 2014, after more than 25 years of operation. Months earlier, the school had been notified by its accreditor that it was in danger of losing its accreditation due to budgeting and other fiscal issues.
A federal judge has revoked an accreditor's decision to strip a massage school of its accreditation, finding that the decision by the accreditor was arbitrary and unreasonable. The decision by U.S. District Judge Liam O'Grady reversed the March 2012 actions of the Accreditation Alliance of Career Schools and Colleges to revoke the accreditation of the Professional Massage Training Center in Springfield, Missouri. The judge also awarded $429,000 in damages in favor of the school.
New York's attorney general has entered into a $10.25 million settlement with one of the nation's largest for-profit school corporations after a two-year investigation into allegations of inflated job placement statistics and other misconduct relating to enrolling students. Attorney General Eric T. Schneiderman announced that the settlement with Illinois-based Career Education Corporation "resolves an investigation that revealed that in disclosures made to students, accreditors, and New York State, CEC significantly inflated its graduates’ job placement rates. CEC will pay $9.25 million in restitution to students, a $1 million penalty, and has agreed to substantial changes in how the company calculates and verifies placement rates." According to the attorney general's office, its investigation revealed that CEC inflated job placement statistics from at least 2009 through the spring of 2011." CEC operates schools that enroll about 75,000 students nationwide, including the Sanford-Brown Institute, American InterContinental University, and Colorado Technical University.