Thursday, February 28, 2008

Career Education Corp.'s Cuppeance

Career Education Corporation one of the bigger players in the for-profit education sales-go-round has fallen on difficult times due to numerous federal investigations and journalistic exposes. They just announced that they were having to close several schools after vainly trying to sell them. Since 2005 CEC has been investigated by the Security and Exchanges Commission, the Justice Department and its Civil Division, the Department of Education and its most valuable asset, American Intercontinental University was put on probation by its regional accreditor. Now, where there is stink, there must be some dead vermin somewhere inasmuch as these agencies, especially under the Bush Administration, do not have that fine a sense of smell. There has to be outright stench for them to notice even a slight odor.

Well the problem of course is a business model that is fashioned after sales techniques a big city Three Card Monty player or a serpent lubricant vendor might employ. See, education is not a "final sale" were you can amber way from the transaction at an exponential pace. The mark sticks around for two to four years and in that time is quite likely to find out the falsity of any misrepresentations made during the sale. Now, you can continue the deceptions, however, it becomes increasingly more difficult and CEC ultimately failed.

CEC purchased many career schools around the nation, some of which were venerable or long standing institutions such as California Culinary Academy, Brooks Institute of Photography, Brooks College, Katharine Gibbs School, Lehigh Valley College and then applied a business model more suited to a penny stock boiler room than offering education which is almost a public utility when you consider its importance to individuals and society at large. Let us hope that they are in the process of rethinking this strategy.

Friday, February 8, 2008

Florida Metropolitan University "Settles" With AG over Transfer of Credit "Allegations"

Florida Metropolitan University, has morphed into Everest University and "settled" the Florida AG's inquiry into their transfer of credit wrongdoing. The settlement is humorously redundant and rather hilarious as they basically are going to agree to do what they were already doing, which was "assisting" their students in transferring credits which they knew were not transferable and are still not transferable. This is tantamount to Kevin Trudeau settling an action with the FTC by assisting persons who bought a phony cancer cure, with having the cancer cure work. Coral calcium doesn't cure cancer and the credits that FMU assured its students would transfer to regionally accredited schools are not going to suddenly be transferable simply because most FMU is going to "assist" the students in transferring them. If the portion of the settlement wherein the FMU/Everest will be forced to "better disclose" the fact that the credits do not transfer or i.e., stop lying about them transferring, then it will be beneficial.

Nationally accredited schools complain about the fact that regionals will not take their credits. Whether or not this rejection is fair or not is not the issue, they know that their is a transfer of credit problem, yet do not disclose it to their prospective students and then point to the plight of the students who predictably cannot transfer the credits. So they use the students as unwilling food solders and designated victims in their fight with the regionals. This is illustrated very well by this statement in the article:

"FMU representatives have long maintained that the school has been up-front with prospective students. They also say the problem lies with the transfer schools, for wrongly rejecting credible FMU credits."

The absurd contradictions in that statement would torch any brain cell trying to deal with it. So don't try, you will only hurt yourself. If FMU had been upfront with the students about known credit transfer issues, why would those students be surprised that their credits would not transfer? FMU is like a car dealership that sells you a car that they warrant is perfect when you know it isn't and then getting angry at the unaffiliated service station that will not fix it for free. What's worse still, the cars can never be fixed!