Career Education Corporation (CEC), a for-profit education company, settled a multistate investigation into its alleged deceptive recruitment and enrollment practices.
As part of its settlement agreement with 48 states and the District of Columbia, CEC agreed to forego collection of $493.7 million in student debts. It means 179, 529 students nationally will get relief from their outstanding debts with the company.
CEC also agreed to an additional $5 million payment to the settling states and to significantly reform its recruiting and enrollment practices.
The state attorneys general of Pennsylvania, Oregon, Maryland, Kentucky, Iowa, Illinois, and Connecticut led the investigation against CEC.
Allegations against Career Education Corporation
In their investigation, they found evidence that the company committed the following:
- Deceived students about the total costs of enrollment;
- Misled students about the transferability of credits into and out of CEC from other institutions;
- Deceived prospective students about the rate of CEC graduates that obtain jobs in their field of study;
- Used emotionally charged language to pressure students into enrolling in its schools.
The company agreed to resolve the allegations of the attorneys general without admitting its wrongdoings.
