REPUBLIC REPORT: Colorado Sues CollegeAmerica for Systematic Deception

Career College Central Summary:

  • A state court in Denver has just unsealed the complaint that the Colorado attorney general brought late last year against CollegeAmerica / Stevens-Henager, a former for-profit college network that recently converted to non-profit status. The school’s conversion seems to enrich its founder in ways that disturbingly distort the concept of a non-profit, but its apparent abuses of students are even more troubling.
  • Last year the U.S. Justice Department joined an employee whistleblower lawsuit charging that College America / Stevens-Henager schools paid their recruiters bonuses, commissions, and other forms of incentive compensation in violation of the federal ban on such compensation. The suit further claims that CollegeAmerica employed faculty members who lacked the minimum qualifications required by the school’s accrediting agency, and that CollegeAmerica officials falsified student attendance records and grades.
  • The new Colorado complaint ups the ante: It provides new and absolutely shocking allegations of systematic, sophisticated fleecing of students and taxpayers by CollegeAmerica. The lawsuit asserts that CollegeAmerica staff consistently misled and lied to students about the selectivity of the school, the transferability of credits, the jobs they could obtain, the salaries they could earn, and more.
  • In one stunning example, the school, according to the Colorado attorney general, hyped its “Medical Specialties” associates degree as leading to lucrative careers in a range of medical jobs. The program cost $42,000 — more than four times as much as comparable degree programs at community colleges. But most of the jobs that graduates had a chance to get were low-level, low-paid positions did not require a college degree at all.  Once students had completed the program, CollegeAmerica employees would then sometimes disparage the value of the program and hype the next expensive program — a bachelor’s degree in Healthcare Administration. But again, most graduates could only get low-rung jobs that did not require an associate’s degree, let alone a bachelor’s.
  • CollegeAmerica has responded that Colorado’s suit is “full of distortions, half-truths and false allegations.”

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