Va. students to get $8M through settlement with for-profit college owner

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Mark Herring_1546625834485

ALEXANDRIA, VA – FEBRUARY 10: Virginia Attorney General Mark Herring speaks to members of the media after a hearing February 10, 2017 in front of a U.S. District Court in Alexandria, Virginia. Attorney General Herring attended the hearing for a request he filed to block the travel ban executive order issued by President Donald Trump. […]

RICHMOND, Va. (WAVY/AP) — Thousands of Virginia students who studied through a for-profit education company will be receiving a just over $8 million total as a part of a multi-state settlement.

Virginia Attorney General Mark Herring said Friday he and 48 other attorneys general settled with Career Education Corporation (CEC).

Per the terms of the settlement, the company has agreed to reform its recruiting and enrollment practices and forgo collecting over $490 million in debts from nearly 180,000 students nationwide.

In Virginia, the $8 million will be divvied up to a little more than 3,000 students.

“Virginia student borrowers deserve to have complete and accurate information when deciding whether a school is right for them or making financial decisions,” Herring said in a statement.

Herring’s office said a group of attorneys general started investigating the CEC in January 2014 after receiving several complaints from students.

The investigation found the company used “emotionally charged language” to pressure students into enrolling in its schools, and deceived students about the total cost of enrollment.

The attorneys general found students were misled or deceived in a number of other ways including the transferability of credits from other schools and the rates at which graduates were hired in their field.

“CEC’s practices misled and deceived students and left them unable to find employment in their chosen field and saddled with immense debts,” Herring said. “This settlement will give thousands of Virginians the relief that they need and help ensure that the company will make substantial changes to their practices for future students.”

Many schools under the Career Education Corporation umbrella have been closed or phased out over the past 10 years.

Students who attended a CEC institution that closed before Jan. 1 of this year are among those eligible for debt relief. Those with questions about eligibility are being asked to contact CEC by email (CECquestions@careered.com) or phone (844-783-8629, 847-783-8629).

Company officials on Thursday said they deny any wrongdoing but called the settlement an “important milestone.”

“We have remained steadfast in our belief that we can work with the attorneys general to demonstrate the quality of our institutions and our commitment to students,” Todd Nelson, the company’s CEO, said in a statement.

Based in Schaumburg, Illinois, the company enrolls about 34,000 students across two chains, Colorado Technical University and American InterContinental University. More than 90 percent of its students are enrolled through online courses, according to the company.

At its peak, Career Education Corporation ranked among the largest for-profit college companies in the nation, enrolling more than 100,000 students at several chains including Sanford-Brown College and Le Cordon Bleu, a group of culinary schools.

The settlement was signed by every state except California, which is negotiating a separate agreement of its own, and New York, which previously settled with the company.

Copyright 2020 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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