The New York Times reports today that “The Department of Justice and four states on Monday filed a multibillion-dollar fraud suit against the Education Management Corporation, the nation’s second-largest for-profit college company, charging that it was not eligible for the $11 billion in state and federal financial aid it had received from July 2003 through June 2011.”
Education Management “enrolls about 150,000 students in 105 schools,” among them The New England Institute of Art (slogan: “Create Tomorrow”). Just how it enrolls them is at the heart of the lawsuit: “Recruiters were encouraged to enroll even applicants who were unable to write coherently, who appeared to be under the influence of drugs or who sought to enroll in an online program but had no computer.
Maybe that’s why they Create Tomorrow – because they’re out buying a laptop today.
Regardless, we’re talking about serious money here, as the Times piece notes: “According to the 122-page complaint, Education Management got $2.2 billion of federal financial aid in fiscal 2010, making up 89.3 percent of its net revenues.”
Yikes.
(Fun fact to know and tell, buried in the Times piece: “In 2003, Education Management’s chief executive was Jock McKernan, a former governor of Maine who now serves as chairman of the board. Mr. McKernan is married to Senator Olympia J. Snowe, a Maine Republican whose 2010 financial disclosure form lists Education Management stock and options worth $2 million to $10 million.”)
Massachusetts is not one of the four states joining in the lawsuit, but the hardworking staff called the New England Institute of Art anyway to see what they had to say.
And . . . no one had anything to say. But they helpfully steered us to this statement from Education Management, which doesn’t have much to say either. It’s called Litigation Management.
Campaign Outsider 
Hrmm,… not surprising…
Yea, the recruiters acted more like salesman than anything else. I can think of dozens of bozos who belonged back in Junior High, not college, but were enrolled anyway. Career services referred to jobs at Star Bucks as “full time positions”. Oh, and the drop out and kick out rate? “Higher” then the kids who dropped out were.
My instructors were excellent though, I hope this doesn’t hurt their careers.
I went to NEiA. It was poorly managed and not all of the instructors could teach. The ones that were more than capable deserved better. So many minds passed through those halls looking to do what they loved for the rest of their lives, just to risk ending up in a dead end nowhere job. They sold me “Get a job within six months of graduating, Guaranteed!” “Make 65,000$ in your FIRST job!” I can’t believe how many people fell for it, myself included. I even remember some of the teachers treating their students like competition and less like students…I just hope those who were wronged by this school get compensation.