Justice Dept. accuses college of breaking law
Justice Department, 4 states accuse for-profit college of breaking ban on recruiter incentives
From staff and wire reports
Read more by staff and wire services reports
The complaint alleges student enrollment was the sole focus of its compensation system.
The Obama administration and four states are accusing a private for-profit college corporation of illegally paying recruiters to enroll students, the latest action in an examination of the industry’s recruitment techniques and an allegation the company called “flat-out wrong.”
The Justice Department and attorneys general of California, Illinois, Florida and Indiana on Monday intervened in a whistleblower suit against Pittsburgh-based Education Management Corp. Their complaint says the company broke a 1992 law prohibiting for-profit colleges from paying recruiters incentive compensation.
The law was passed to stop overly aggressive sales procedures.
This is the first time the federal government has intervened in a suit alleging a violation of the ban. The suit originally was brought in 2007 by former Education Management workers Michael Mahoney and Lynntoya Washington.
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