History of IDEA
Jeannie Oakes, Founder and Former Director
Youth Voice in School Finance
NEW REPORT: Los Angeles' road to A-G for all
Without Dollars and Sense Powerpoint
Past Educational Opportunity Reports
U.S. to join suit against for-profit college chain
- 05-03-2011
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By Tamar Lewin/New York Times
The Justice Department plans to intervene in a whistle-blower lawsuit charging that one of the nation’s largest for-profit college companies, the Education Management Corporation, defrauded the government by illegally paying recruiters based on the number of students they enrolled, according to a Securities and Exchange Commission filing on Monday. The filing by Education Management, known as EDMC, said “several states” also planned to join in the False Claims Act case, in federal court in Pittsburgh, alleging violations of their state laws. This is the first time prosecutors have joined such a case, one of dozens in recent years that accuse the for-profit college industry of illegal practices devised to increase federal student aid revenue. The company, which enrolls nearly 150,000 students, operates several career-college chains, including the Art Institute, Argosy University, Brown Mackie College and South University. EDMC, 40 percent of which is owned by Goldman Sachs, said in its securities filing that its compensation plan for recruiters did not violate the law, and that it would “vigorously defend itself.” (more...)
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