More than 1,800 Mississippians who took out student loans to pay for their college education through a for-profit education company will not have to repay the money, thanks to deal with 48 states announced over claims deceptive recruitment and registration practices.
Attorney General Jim Hood and his counterparts on Friday announced a settlement with Career Education Corporation that resulted in the cancellation of more than $ 493 million in loan debt nationwide, including more than $ 3 million in Mississippi.
The joint announcement is the result of years of investigating the Illinois-based company’s recruiting practices. Students had enrolled in dozens of CEC campuses and online courses across the country over the past 30 years, including brands such as Briarcliffe College, Brooks Institute, Brown College, Harrington College of Design, International Academy of Design & Technology, Le Cordon Bleu, Missouri College, Sanford-Brown and others.
Attorneys General began investigating after receiving numerous complaints and a critical report on for-profit education from the US Senate Committee on Health, Education, Labor and Pensions.
“Pursuing your education is a noble endeavor, and it is a shame that those who do are being exploited financially by these companies which are there to make money rather than to educate our citizens,” Hood said in a press release on Friday. . “I am proud of the Consumer Protection division of our office for ensuring that the Mississippians who have sadly fallen victim to this school receive proper debt relief.”
Specifically, the company is accused of a number of illegal and deceptive tactics, including using “emotionally charged language” to pressure students to enroll; requiring its admissions representatives to inform prospective students only of the cost per credit hour without disclosing the total number of credit hours required; mislead students about the transferability of credits obtained in CEC schools; distorting the possibility for students to get a job, when the school did not have “the necessary programmatic accreditation”; and by distorting the percentage of CEC graduates who were placed in jobs using figures based on graduates who held temporary or unrelated jobs.
“Due to the unfair and deceptive practices described above,” Hood noted, “students enrolled in CEC who would not have enrolled otherwise, were unable to obtain professional licenses and were faced with significant debt. that they could neither reimburse nor pay ”.
Following the settlement, the CEC will waive collection of debts owed to it by students residing in participating states who attended a CEC institution that closed before January 1 or whose last day of attendance at the American Intercontinental University (AIU) or Colorado Technical University (CTU) was held no later than December 31, 2013. In addition, Mississippi will receive $ 50,000 as part of a $ 5 million payment to the States. , and the company will need to make significant changes to its recruitment and registration practices.
In a statement released Thursday, the company denied any wrongdoing, but pledged to work with attorneys general to address their concerns. “The resolution of this open investigation is a significant milestone for the company that coincides with the completion last month of a multi-year process of teaching and closing our transition campuses.” said Todd Nelson, chief executive. “We have remained steadfast in our belief that we can work with Attorneys General to demonstrate the quality of our institutions and our commitment to students.”
The only states not party to the settlement were New York (which reached an agreement with the CEC in 2013) and California, which is expected to announce a separate settlement soon.
To view Hood’s full statement, visit http://bit.ly/2s61OMu. Former students with questions about eligibility for debt relief can contact the CEC at 847-783-8629 or by calling toll-free at 844-783-8629. CEC’s email address is [email protected].
Contact Bill Moak at [email protected].
What shall we do now?:Virginia College students in Jackson shocked by brutal shutdown
Finances:Revolving credit keeps cardholders in debt
