Cost of Education, Domestic, Education Quality, Ethics, For-Profit, Friend, Fraud, or Fishy, Gainful Employment, Lawsuits & Legal, Minorities, Regulatory, Required, Retention Rates, Student Loans, Universities & Colleges - Written by on Tuesday, November 27, 2012 6:17 - 4 Comments

Heard: Whistleblower Pops Lid On Deceit At EDMC Schools

Olha o mar Danilo Bandeira via Compfight

Mark Greenblatt at ABC News filed an report about an Education Management Corp. - EDMC - whistleblower who says the company is lying about its job-placement rates. It’s another sign of For-profit colleges caring too much about their shareholders and not enough about their customers or their regulators (i.e. the federal government). As always, we welcome students to share their opinions and stories in the comments section below or to email our staff with the same.

ABC reports:

Jason Sobek says he left his job as admissions supervisor at the nation’s second-largest operator of for-profit colleges — the Education Management Corp., or EDMC — on good terms. But after he quit, Sobek filed a whistle-blower lawsuit against this provider of post-secondary education, alleging its marketing materials deceived prospective students by falsely inflating job placement statistics at its many campuses around the country. “They manipulated the job placement rates by counting students working in a job that they did not need the degree for,” Sobek told ABC News. “In my opinion, it’s a wretched fraud.”

Before he left EDMC, a publicly traded for-profit corporation that operates such colleges as the Art Institutes, Brown Mackie College, Argosy University and South University Online, Sobek downloaded a trove of data and documents, which, he alleges, support his claims.

Sobek gave ABC News an exclusive look at one of the internal nationwide job placement databases at EDMC, which shows the degrees students received upon graduation and what jobs (if any) they obtained. Sobek says the database also stated whether the job could be counted as “related” to their degree for the purpose of marketing job placement success rates to potential students. Sobek claims the data reveal a pattern of fraudulently counting students as landing great jobs to create a false impression for future students. “It is intentional. It’s the business model,” he says. Sarah Fisher, a graduate of EDMC’s business management program at Brown Mackie College in South Bend, Ind., says she believes the school made her false promises. “They told me I’d be making $35,000 to $40,000 a year,” she says.

To help pay her way through school, Fisher, a single mother, took a job at Walmart making $16,000 a year. She took the job long before she graduated, but Brown Mackie College still counted that customer service job as “related” to her business management degree….

Via ABC News



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Steve Macintyre
Nov 30, 2012 0:00

EDMC has committed fraud on a monumental scale and the federal student loan company, Sallie Mae is aiding and abetting it by giving out loans with ridiculous fees and penalties when students leave the school heavily in debt and without adequate or even competent training as was promised by such recruiters. The right thing to do is to have EDMC refund all the money to the government and private loan institutions and forgive the debt. Students are not able to sue the school either because a clause in the registration prevents any kind of legal actions against the school if the student isn’t satisfied with the product. What kind of company has that kind of clause in their contracts unless they already knew their product was a ripoff, I ask you?

Chris Pantzke
Dec 1, 2012 23:34

EDMC is not only taking advantage of good people with high hopes to provide a betterife for their families, they are also targeting those that have served their country so bravely and proudly and come back home with severe disabilities. These veterans deserves a quality education, but EDMC just sees the GI Bill as dollar signs, and fail to provide proper disability services for those who needed those services, like yself. I was gate a way to over $70,000 dollars in the post 911 GI Bill benefits. I have $26,000 in student loan debt. EDMC left me high and dry (Art Insitute of Pittsburgh Online). For those that are considering attending an online school please.research the school, if they are publically traded on Wall Street, be for warned that are a for profit college and most likely give you an over priced degree that is worthless and leave you student loan debt up to your eyeballs. Please be careful, and use a buyer beware mindset went choosing a college to attend.

Chris Pantzke

Paul Glader
Dec 2, 2012 22:01

Hi Sgt. Pantzke. Thanks for your comment. I just tried emailing you but got a bounce back. Can you shoot me a note at [email protected] ? Thanks, Paul Glader, Editor

Dec 9, 2012 20:55

Sobek filed the whistleblower lawsuit 11 months BEFORE he left EDMC. The ABC article has since been corrected.

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