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U.S. for-profit college to pay $90-mln settlement -NY Times
November 16, 2015 / 3:41 PM / 2 years ago

U.S. for-profit college to pay $90-mln settlement -NY Times

WASHINGTON, Nov 16 (Reuters) - The second-largest for-profit college operator in the United States, Education Management Corp , is expected to pay nearly $90 million to settle charges that it enrolled students too aggressively, the New York Times reported on Monday.

The settlement, due to be announced on Monday, would be the largest ever false-claims agreement reached with the U.S. Department of Education, according to the Times.

It would resolve accusations that the company violated state consumer-protection laws by compensating employees based on how many students they recruited, leading to high-pressure sales tactics, the Times said.

That would also violate a ban on per capita compensation at schools that participate in federal student-aid programs, according to the Times. The school collected $11 billion in revenue through federal loans and grants between 2003 and 2011, about 90 percent of its tuition dollars.

Education Management, based in Pittsburgh, operates over the Internet and in 32 physical locations in the United States and Canada as the Art Institute, Argosy University, Brown Mackie College and South University. It offers undergraduate and graduate degrees. (Reporting by Andy Sullivan; Editing by Kevin Drawbaugh and Jonathan Oatis)

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