All Four Crown Officers Convicted

Well, its been awhile, and a great deal has happened in the Crown College financial aid theft case. All of the defendants are guilty, two of them, Misty Lee and Sheila Mullineaux plead guilty and have been sentenced, however, Jennifer Beyers and Jessica McMullin declined plea offers and took their chances at trial, and were convicted on July 14, 2011 on all the charges. Now, how they thought that they could win at trial is beyond me and one would hope that they would face serious consequences because of their Peter Pan thoughts that they were someone not guilty and the fact that four days of court time was wasted. But their sentencing has been moved to November to a date to be announced.

Crown College Financial Fraud Case Update

There are many developments in the Crown College Financial Fraud indictment of the four former officers of Crown College. On July 26, 2010, Misty Lee pleaded guilty to counts 1 and 2 of the indictment pursuant to a plea agreement with the government which was sealed. The minute order of the hearing is here:

Minute Entry for proceedings held before Judge Karen L Strombom- CRD: Traci Whiteley; AUSA: Nick Brown; Def Cnsl: Colin Fieman; PTS: Todd Skipworth; Time of Hearing: 11:30; Courtroom: F; Session #: TAC100726 (SEALED); INITIAL APPEARANCE AND PLEA (via video conference) as to Misty Lee held on 7/26/2010. At the request of the defense and with agreement from the government, the Defendant is present via video conference from the Clerk's Office of the US District Court for the District of Kansas at Topeka. Defendant placed under oath and advised of rights/charges/ penalties; Defendant executes Consent to Rule 11 Plea in a felony case before a U.S. Magistrate Judge; Education = 2 yrs college; Court reviews the plea agreement; Pleas guilty to counts 1 and 2; Remaining Count to be dismissed at sentencing. Court finds the Defendant is competent to enter a guilty plea; Court signs the Report and Recommendation and Counsel have fourteen days to file objections; Court orders the preparation of a Presentence Report. Defendant remains "at liberty."

Sentencing set for 10/15/2010 at 10:30 AM in A Courtroom before Judge Robert J. Bryan. (TW)

Well the Misty Lee's sentencing was continued until the rest of the defendants could enter the pleas or go to trial and then followed a great deal of postponements as the defendants and prosecutors Next Sheila Mullineaux plead guilty and was sentenced because, apparently, she was not going to testify against the other defendants.

Crown College Ex-Officers Steal from You

As most are aware, Crown College ex-officers, former vice president, Sheila Mullineaux; the college's admissions director and registrar, Jesica McMullin; and financial aid director Misty Lee, and Jennifer Byers, the fiscal manager and bookkeeper were indicted by a federal court. Their arraignment was set continued from May 28 to June 11, 2010. On June 11, 2010 only Jesica McMullin appeared. The clerk clerk stated that the U.S. Attorney's office was inquiring as to whether they had received notice of the arraignment before taking further action.

This indictment will most likely not be news to many of the unfortunate students not to mention the even more unfortunate taxpayers. Actually one could argue, and I do, that Crown College and their staff have allegedly been stealing from the federal government for some time which is what happens when you lie to students about the transferability of credits. Those students do not receive the education they bargain for and are stuck in place and have wasted the taxpayers' money or they must continue their education in another school, again in determent to the taxpayer.

In reality, if these ex-officers are guilty, what they have done is simply dispense with the middle man, i.e., the students and stuck their hands directly into the public till. You see, the federal government and you gentle taxpayer fund higher education and for-profit schools through the grants and federal loans. Yes, the student is responsible, however, since the federal government guaranteed the loan, the taxpayer is on the hook.

Crown College Former Officers Indicted

Well as the Seattle PI reported four former Crown College officers were indicted for financial aid fraud. This would include almost the entire office staff: former vice president, Sheila Mullineaux; the college's admissions director and registrar, Jesica McMullin; and financial aid director Misty Lee and Jennifer Byers, the fiscal manager and bookkeeper. Well, it took three years, but justice has never been known for its speed and the truth is easily obscured and obfuscated. Crown College was always been a business and that trumped every other consideration, including educating and honesty. Most people think accreditation is accreditation. Unfortunately, it is not. There is national accreditation, which is basically conferred to vocational, career schools and regional accreditation which is conferred on academic institutions. In many cases, the credits don't mix, i.e., most academic institutions do not accept credits from Crown College and other nationally accredited schools. Now there is quite a debate as to whether this is fair or not, however, that issue never excused Crown College from being honest with their students. Instead, they complained about the unfairness of regional accredited schools not accepting their credits for transfer while at the same time, telling their students, that Crown's colleges credits transferred. No problem.

Let's take a trip back in time. Crown College's success and even existence was always intricately tied to the ability of its staff to convince students that its credits were transferable to academic institutions. So they lied to students, bold faced lies, and they were able to get away with it, for a long time.

Each of these former officers, that have been charged by the federal grand jury lied to students in order to keep Crown College in the black and in fact it brought in $4,000,000 at its zenith. Your tax money boys and girls, since the money comes from the federal government. As far back as 1997 a complaint was filed against Crown College complaining that that credits that Crown College officials stated would transfer did not. Lola Jackson finally brought a case against Crown College and they finally settled out of court. However, Latisha Gonzalez filed a lawsuit and then a class action lawsuit was filed and then the media became involved. John Wabel, who basically was Crown College, had no choice but to stake his entire reputation on defeating the Gonzalez suit. It's amazing to see how he refuses to even accept the possibility that his administrators could lie, which, of course it appears that they did.

The publicity generated by the class action lawsuit exposed Crown College's practice of lying about the transferability of their credits and then, after an epic judicial struggle, Crown College lost the Gonzalez lawsuit, was saddled with paying Gonzalez's attorneys $70,000 and an injunction which prohibited them from deceiving students. They settled a second law suit for $70,000 and then hoped to resume their "business" practices. However, stuffing a cat back into a bag is no mean task, especially with the indelible stain that the internet can leave, but I'm mixing metaphors. Suffice to say, that once students realized that the Crown College's credits did not transfer, they no longer wished to pay the premium fee to attend it. Community colleges were a much better deal.

Crown College was never able to recover despite an influx of money and a new round of advertisements. It was already all over the internet that the school's credits did not transfer. Thus, it was clear it was going to close and that is when these officers hatched this scheme.

For profit schools make money off the government

According to the article in MSNBC above, for profit schools loan money to students who they know will default on those loans. Amazing, huh? I mean these are not some kind of "ineffective" governmental program or non-profit, starry eyed organization bent on helping students notwithstanding other considerations, such as making money! Well, for profit schools make money whether or not students learn or pay back their student loans. In most cases the federal and/or state government pays them either directly in tuition reimbursements or indirectly by "loaning" the students the money to attend these schools. Consequently, so when the endeavor to loan the money themselves, even knowing they may not get it back, its like losing to win!

Regulation of California Vocational Schools

In 2007, the Bureau for Private Postsecondary and Vocational Education agency which once regulated California's vocational/trade/career schools ceased to exist, when the legislation which authorized it was allowed to slide, unimpeded, off the book of laws when the legislature failed to renew it. The Bureau was disdained by the schools it regulated and consumer advocates alike. Since that time California's career schools have been under only voluntary regulations and attempts to pass a new law, specifically SB 823, have been unsuccessful as career schools felt the proposed law was too strict.

Now another law, AB 48, has been proposed. The Consumer Federation of California has proposed much needed reforms to the proposed law.

Transfer of credits is one of the most important ones. Credits earned at these career institutions are very seldom taken by regional accredited universities. In own study performed by the career schools themselves, only 18% were taken. Career schools have complained long and hard about this situation and even tried to force the federal government to mandate that their credits would transfer, however, generally, their course work is geared toward preparing students for careers and not academic proficiency thus, they are though to be inferior. Without regards to the merits of this argument, that is the present reality and students need to be made aware of this fact. However, the fact that a career school education is not necessarily portable to a regionally accredited school, is detrimental to its marketability thus for-profit schools wish to obscure this fact. Careers schools should be forced to divulge this information in the enrollment agreement in no uncertain terms.

Alen Janish & CRI - How To Have Access to Federal Aid and Spend it Too

Most of you are aware of CRI and the way it masqueraded as a viable court reporting school when in sobering reality it was merely a vessel to enrich the clever cronies who had ventured upon a clever scheme to separate vulnerable students from government money. Yes, government money. Strange is it not? If its government money, why does it belong to the students you might inquire? Well it belongs to the students because its the students who end up having to pay it back...and that's forever!

Actually Janisch was a bit more advanced than many of the unscrupulous school operators out there. He managed to swindle not just the students but the Department of Education itself, actually not that difficult. The Dept. of Education has a requirement that a school must meet certain financial standards in order to participate in the financial aid program which is literally the lifeblood of any proprietary school since the students do not pay the tuition for most of these schools, they just have to pay the tuition back. Janisch, in order to meet this requirement, engaged in a version of Three Card Monty, with his finances and those of two of his cohorts or elves if you will. The Dept. of Education requirements are not difficult to anticipate inasmuch as they appear at the end of the year regularly, a bit like Santa Claus. Thus, if a school has enough money at the time the DOE checks their finances then they are good to go. Its as if Santa Clause only checks if you're naughty or nice at the end of the year, ignoring your behavior during the rest of it. Read the summary judgment in the CRI bankruptcy case to get an overview of how this worked.

So Janisch, made sure that he had enough money, jewelry, letters of credit, or whatever negotiable instrument he could locate to satisfy the DOE's predictable journey through his books and then as soon as they turned the corner, simply repatriated what ever collateral his friends had loaned him and went on on about his crooked business.

National Accreditation's Use of Dept. of Education to Equate Themselves With Regional Accreditation

It's the argument that nationally accredited schools march out the most in their attempts to declare themselves the equal of regional accredited institutions. Since the Department of Education does not distinguish between regional or national accreditation, then they are equal and, more importantly, then all the institutions that they accredit are equal. For example, the latest incarnation of this theory arises in this letter which appears to have been solicited by the Distance Education Training Council, a national accrediting agency, to bolster their argument that all accreditation is equal.

The pertinent part of the letter reads: "The Criteria do not differentiate between types of accrediting agencies, so the recognition granted to all types of accrediting agencies-regional, institutional, specialized, and programmatic-is identical. Only the specific scope of recognition varies according to the type of agency recognized."

The Department of Education "criteria" has to do with what is expected of an accrediting agency not what is expected of the schools it accredits. What is relevant are the criteria that the accrediting agencies apply to the schools they accredit. Incidentally the Department of Education has nothing to do with the academic or transfer of credit affairs of any school. Thus, what the Department of Education thinks about accreditation is irrelevant. The letter appears to be solicited by the DETC to make the argument that because the Dept. of Education's Criteria for recognition of an accrediting agency is the "same" for all accreditors, then all accreditation is the same. Secondly, the letter clearly states in the second sentence that "... the specific scope of recognition varies according to the type of agency recognized." Thus the scope of recognition varies according to the type, sooooooooo, all accreditation is apparently not the same, contrary to the first statement. Criteria for inclusion as an accrediting agency has to do with Dept. of Education regulation and has nothing to do with the academics of the schools which are being accredited or the particular criteria applied by the accreditors to decide what school it will accredit.

According to the anon users' scenario and the letter purporting to support it, an accrediting agency which only accredits certificate granting vocational schools and there are some, would be equivalent to the American Bar Association or, in effect, a massage school is equivalent to Harvard Law School. This is, of course, ludicrous. What is relevant are the accrediting criteria of the particular accrediting body, the criteria which schools accredited by that body have to meet. There is obviously a difference between the accrediting criteria of an accreditor who accredits certificate granting purely vocational schools and the accrediting criteria of the American Bar Association, just as there are differences between the criteria of the DETC and other national accrediting agencies and that of a a regional accrediting agency. The Department of Education merely recognizes an accrediting agency for the purpose of whether or not the students attending schools accredited by that particular agency can receive federal loans and grants. The Dept. of Ed. does not pass judgment on the equivalence of the criteria of one accreditor vs. another. no distinction between national accreditors and regional accreditors there must not be one.

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.

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!

Alen Janisch aka CRI, Retreats to Personal Bankruptcy

For those of you who are not familiar with Court Reporting Institute, Inc. aka CRI, then I suggest the CRI saga website. CRI was basically Alen Janisch adorned with the vestiges and protections afforded by corporate form. Mr. Janisch operated under the guise of CRI, which masqueraded as a educational institution when in reality it was a vehicle for defrauding students, in essence a Venus fly trap, as detailed in the numerous complaints which were sent to the Workforce Training and Education Coordinating Board, a veritable roach motel where only 6% of the students escaped aka graduated and only 1% of those were actually working in the court reporting field.

After 18 years, the Washington State Workforce Board refused to renew CRI/Janisch's license to teach court reporting, then CRI/Janisch was the subject of a distinctly unfavorable article in the Seattle Times and students left in droves. Janisch/CRI closed its "stores" and then when it became clear that its pursuers would not stop...well, pursuing, CRI declared bankruptcy. At the first bankruptcy hearing Janisch declared that CRI had no assets. Hmmm, it turned out that Janisch had withdrawn almost a million dollars out of "CRI" immediately prior to its "fiscal" demise as he admitted in his deposition. The Bankruptcy Trustee promptly filed a lawsuit against Mr. Janisch himself and then moved for summary judgment, to force him to return the money and now, possibly to evade that obligation, he has declared "personal" bankruptcy. Actually CRI/Janisch owes a lot of money.

In his personal bankruptcy filing Janisch states he has around $10,000 in assets and around $10 million in liabilities. Actually, these are debts that CRI incurred. Mr. Janisch's 2837 listed creditors, parallel, surprise, CRI's and include approximately 2800 students who attended his ... enterprise. Ironic when you are seeking to discharge obligations students might have AGAINST YOU. One would think that you SHOULD OWE the students. Guess he listed all those students since 13 of them are suing him and the bankruptcy automatic stay will stop that civil action. Perhaps he was expecting, and rightfully so, those other 2782 to sue him as well. After all, he still owes them money or an education. He took the former and never gave the latter.

For-Profit Education is Just Like Any Other Business?

There has been some controversy over University of Irvine at California and Capella University's agreement that Capella will pay UCI $500 for each student that transfers to Capella University...a marketing fee, consulting fee, cost reimbursement fee, fee split, bounty, kickback, depending on what how you feel about such arrangements. UCI is a public, non-profit institution and Capella is a for-profit private university.

I got into a vigorous discussion/debate with another "blogger" as to how this situation should be treated in an online encyclopedia. That person felt that because the US Department of Education's declared that such an agreement was legal, it was therefore ethical, as if its legality precluded any inquiry into its morality. I pointed out, that credit card companies can legally charge 20% interest rates to their customers, and banks can legally charge $35.00 for overdrafts, and mortgage companies can legally offer home financing with ARMs loans which contain time bomb rates which ultimately explode on the unsuspecting users. The legality of these practices have not precluded or eclipsed discussions on their morality.

When I pointed out, that, as the article cited, there are those who view such an arrangement as making the student a commodity, an object to be traded upon and profited from. This person cheerfully replied that if the agreement treated students as a commodity that was what they are. Students were recruited to attend certain schools, both non-profit and profit, to pay tuition and spend money. Thus they were a "source of production and income." Well, I do not agree with such a statement and see it as one of the biggest problems with for-profit education. They see students as merely commodities and nothing else.

I feel such practices as a school paying another school to refer it students as a conflict of interest and is not ethical. I do not see students as commodities but as consumers of a very valuable and special service, to wit, education. Education is not your ordinary consumable product, like a car, or a sofa. My opinion is that access to education is on a par with access to medical care and legal services. There is a duty that is owed to a patient by a doctor and duty that is owed to client by a lawyer and a duty that is owed to a student by an adviser or school. I feel that they are morally equivalent. Of course money enters into the equation and there are conflicts of interest in the law and medical fields but it is frowned upon and when they are discovered they are news and controversial unlike what might happen in any other "business" where there is no particular duty owed to the "consumer". Education, like health care and legal services is a quality of life issue. It is the key to economic advancement which contributes much to the prosperity of society. When students are treated as "marks" or commodities or persons to profit from, I don't believe that's ethical. Offering kickbacks, marketing fees, referrals or whatever you want call them, has a great potential to obscure the true role of advisers which is to advise the student for the student's sake, not for how much money or profit can be made from them. The practice raises the distinct possibility that students are getting advice which is more dependent on how much money can be gained from them rather that what is truly in their best interest.

My "antagonist" was not completely deterred and stated that paying a school is merely a marketing fee and is a good business practice. Now if Capella was running some other kind of business, maybe it paying another school to refer students to it, would not be controversial, however, they are running a school which is funded by money from the federal government aka the tax payers, so they are going to suffer more scrutiny than a car lot dealership and rightly so. A good business practice for Mercedes Benz is not not necessarily a good business practice for a school!

And that's the problem, many of these for-profit schools are just businesses spewing out diplomas, certificates and degrees like so many cars and interested only in profit with no regard for the desires of the customer. Moreover, they are profiting not only at the expense of the student but at the expense of society and the federal government which underwrites their forays into designer education.

So I Called Herzing Myself

So, I called Herzing College as it was suggested "I" do. I had never called a for-profit school before and it was a very interesting experience. Not unlike calling a car lot or a health club, but more on that later. The deal that the person I spoke to you told me, after checking with the project manager, was that this school has "made a deal with Crown" (aka John Wabel) to accept all of Crown's students; credits. He also pointed out that I would "have a hard time" finding any school to accept Crown's credits, a fact that I was already well aware of. The deal is, as I was told, was that the discount -- wherein Herzing would lower its tuition to that of Crown's and provide free textbooks and software, was only available if the student started this "fall" semester.

Herzing College is not the first for-profit school to accept Crown's credits. University of Phoenix has accepted them for some time. However, many students were induced to go to Crown by misrepresentations made by Crown College admission representatives that there credits would transfer to schools such as public University of Washington and other schools which cost considerably less than Herzing or University of Phoenix. So the fact that Herzing will take their credits, though fortuitous, does not undue the fraud that visited upon them.

Herzing College Responds

An anonymous post was posted in response to a blog article presumably from somebody at Herzing College and I wanted to respond to it. The author of the newspaper article referred to in the "anonymous" post did not ascribe any malicious intent to Herzing, as far as I read. She did report that a current Crown student who presumably contacted Herzing was concerned that all her credits would not be accepted, and more importantly that the school would cost more money than Crown College. As I understand it, the reporter did attempt to contact the school and did not receive a response. The publisher of the blog article also attempted to contact the school and was unsuccessful. The publisher of the blog article did speak with a person who had contacted Herzing College and the person that person spoke to was reluctant to talk to her about specifics concerning Herzing's accepting Crown students.

It is therefore possible that Herzing College initially did decide to accept all credits for which a "C" or better had been earned, reduce the amount of tuition it was charging and offer complimentary software and books to the students who are currently enrolled in Crown and this "offer" was not prompted by the publishing of the second Tacoma News Tribune article and, consequently Herzing never "changed" its position. It is just that nobody was able to ascertain Herzing's position though valid attempts were made to do so.

The author of the blog article, well me, did suspect that Herzing College "changed,", "clarified," "redefined," its position because of the second article. I also suspected, and still do, that their decision to accept Crown College students is not totally altruistic and that their motivations partly revolve around generating name recognition for the school and an influx of revenue, aka students. That in and of itself is not necessarily nefarious and there may be few purely altruistic decisions any commercial enterprise makes. I believe that Herzing's decision to accept all the credits of Crown's College's students' and offer them such favorable terms is puzzling in light of the checkered history of Crown College. I do not believe that this "opportunity" is being extended to non-current Crown College students who have already graduated or quit. Thus, this offer could be a loss leader and they hope to entice former Crown College students to attend there school on terms more profitable to them. Those students will still not be made "whole" as many had hopes of continuing their education at non-profit public universities which cost a good deal less than the likes of the few known schools willing to accept Crown College credits for transfer, including Herzing College.

This blog is about for profit education and what I personally feel is the inherent conflict of interest in any institution that is resolved to provide an education AND make a profit doing it. Many for profit schools, including many of the bigger "players" have been routinely accused of, sued for, and/or settled allegations accusing them of misrepresenting their accreditation, placement rates, facilities, licenses, faculty, transferability of their credits in order to induce prospective students to enroll and stay enrolled so they are able to profit from the revenue derived from them.

However, I have not been able to locate any such allegation, complaint or lawsuit about Herzing College. They are also one of the few for-profit education schools who have are regionally accredited so, they will theoretically not suffer from the "transfer of credit" blues. If they are a purely a white knight, the are to be commended.

Herzing Will Now Accept All Crown College Credits From Current Students

In an earlier Tacoma News Tribune Article, a student stranded by Crown College's loss of accreditation lamented that, despite John Wabel's assurances, Herzing College would only take a portion of her credits and that it cost more than Crown College. Thus, she would have to attend Herzing College for two more years before she received her Bachelor's degree and borrow more money.

It appears, that in response to that article, Herzing has "reversed" course and now, as reported in a follow-up Tacoma News Tribune story, Herzing states that it will accept all the credits of Crown College students currently stranded by Crown College's closure as long as they are earned a "C" or better which is standard practice for transfer. Also, Herzing will charge them reduced tuition and give them complimentary software and books.

Hmmmm, it would appear that Herzing changed (or clarified) its position not out of some kind of everyman, altruistic concern for the academically shipwrecked students but out of perhaps embarrassment at the previous story which appeared to contradict the first reports that they would take all the credits. They are after all a for-profit institution so unfortunately, their motives are suspect. This is an opportunity for them get an influx of students and some name recognition. It also displays the power of the media. Had the Tacoma News Tribune not published the story of the Crown College student whose credits were not going all be accepted and the higher tuition, would Herzing College have changed their position? Somehow I do not think so.

However, the end result will be that the last batch of Crown College students will be the most fortunate inasmuch as they will end up with a credits and degrees from a regionally accredited institution making them truly transferable to most institutions. Something none of the previous 17 years of Crown College students had despite the fact that many admission representatives told them that. Ironic, that they are saved by Crown College's demise! Truly ironic.

Crown College Key Employees Investigated for Financial Aid Fraud

As the Seattle Times reported, federal investigators suspect several Crown College employees of financial aid fraud, conspiracy to defraud and bank fraud. The Department of Education, Office of Inspector General served a search warrant on Crown College and seized records, a lot of records as the returned search warrant details. Apparently, some clever Crown employees, when they suspected that Crown College was going to close, applied for federal loans and grants though they were not and had no intention of attending classes. They figured that once Crown closed the loans would be discharged under Department of Education rules governing school closures and they would retain the funds thus unjustifiably enriching themselves. Unfortunately, Crown did not close when they thought it would, so they dummied up documents giving the appearance that they were attending the school.

Well considering how these employees excel in contriving documents and lying to prospective students, (Read the Declaration of Adrienne Rocco, a former admissions representative and her complaint to the ACCSCT) this was easy enough for them to do. Especially since many of them lack a moral compass, traits that made them quite valuable to school whose profits were premised on lies. There are a few honest employees at the school, as misplaced as they are, and one of them reported the fraud to the HECB which reported it to the Department of Education.

Mr. Wabel informed the Seattle Times that he was unaware of the investigation and declared that the perpetrators were innocent. It seems that Mr. Wabel, as is his habit, was looking the other way, or perhaps behind his back (as he is in the above picture of a Crown College employee get together). However, the affidavit filed in support of the search warrant strongly implies that Mr. Wabel was indeed aware of the investigation, notwithstanding his statement to the contrary. Moreover, the affidavit cites a kaleidoscope of evidence pointing to the potential culpability of all the Crown College administrators named in the search warrant which include Sheila Mullineaux, the director of the school, Jesy McMullin, the senior admissions representative (who allegedly lied about the transferability of Crown credits to several former Crown students), Misty Lee, the financial director and Jennifer Byers, the business manager.

Mr. Wabel is quoted as saying that the employees listed in the warrant "are good at what they do." Would that be lying and stealing? The fact that some of the most trusted, and senior administrators at Crown might endeavor to defraud the federal government simply because they felt that they could get away with it, shows you how casually they could defraud the very students who depended on them for guidance and truth. It might well be why they rose so high in the organization. Mr. Wabel has to be proud of his employee selection process!

BCTI Former Owners Trying to Appease the Masses?

This article in the Oregonian talks about how BCTI's owners have tried to cooperate with authorities in paying back sums owed and signing off on their insurer paying 9 million to the class action plaintiffs and allowing the plaintiffs to go after another 50 odd millions. The interesting part of this article is the Declaration of former BCTI career consultant Lonna Walden. She details the way BCTI operated and the many "stoogents" they signed up:

"During the time I was at BCTI, I enrolled people who were disabled, people who were poor, people who just got out of prison, Level 3 sex offenders, domestic violence victims, people that were simply less fortunate where life had been a rough road for them including individuals from the Department of Social and Health Services (“DSHS”) and Behavioral Health Rehabilitation (“BHR”). For example, Perry Bulkley had a severe head injury and was disabled. I asked Mona Lawrence upon his enrollment where we could possibly place him upon graduation. She said that she had a place called “Morningside” that hired people with disabilities. Since I left BCTI, I have seen Perry standing aimlessly on street corners in the Lacey area." Decl., page 3, para. 8. Her declaration shows that BCTI was geared to enroll whatever students it could enroll with no regard to educating them whatsoever. This, of course, completely contradicts, the protestations of innocence of BCTI's owners, Tom Jonez (pictured in his new job running a Christian ministry) and Morrie Pigott. Ironically enough, Jonez and Pigott met at a Christian youth ministry in the 1970s according to the Tacoma News Tribune article by Dave Wickert.

It certainly makes one wonder what kind of Christianity they were practicing! Of course, they are adamant that they did nothing wrong, that the enrollment contracts specifically emphasized that they did not promise any student a job. Again, the reliance on the written contract which somehow nullified all the verbal cajoling and promises of jobs!

John Wabel, Humanitarian to Students ... In His Dreams!

After recovering from laughing so hard at the quote "not a dry eye in the building" in the Seattle Times article referring to the state of Crown College's shuttered employees I was confronted with the Tacoma News Tribune article which quotes John Wabel (pictured with Randi Jones, Director of Education, left, and unknown employee) stating that "That is the only thing that mattered to us then, and it's all that matters now," referring to his efforts to assist students in jumping from the wrecked ship that is Crown College. Strange that he is attempting to help the students now, when he could have provided them much more assistance in not lying to them when they first had the misfortune of crossing the "virtual" threshold of his school and getting their "virtual" education. Instead he and his admission representatives lied about the accreditation of the school and the transferability of their credits. Ironically enough, Mr. Wabel was quoted in a Seattle Times article: "Crown College owner John Wabel remains adamant that Crown credits transfer in many cases." However, if the credits transfer "in many cases" he wouldn't have to be scouring the nation to find a school that accepts them now, so far locating only an obscure online school in Wisconsin which apparently will not take all the credits.

Mr. Wabel laments that his school was closed by the ACCSCT as opposed to the ACCSCT trying to help him place more students in jobs. Mr. Wabel does not identify how the ACCSCT was supposed to assist his school. However, this a continuation of Mr. Wabel's attempt to shift the blame for his own shortcomings. Now its the accreditation's agency's fault that the education that his students pay so dearly for, is inadequate. When he was sued successfully it was the plaintiff's fault. In fact, he is quoted in the article as calling her a liar:

"It did not happen," Wabel said. "We are not wrong, and it sets a precedent for the entire industry. Anybody can make up a story, but what is in writing?"

Well I guess its sets a precedent for the part of the industry -- and for-profit education is indeed an industry -- that lies to its prospective students, which is, well most of the industry. The for-profit education industry is notorious for having admission representatives tell ever increasing fibs about key aspects of the school which are disavowed by the contract. These students who tend to be trusting and somewhat naive, tend to trust the admission representatives who they assume are there to assist them.

John Wabel's Fantasy Land - More on Crown College Closure

Reading Crown College’s press release regarding its closure is hilarious as it speaks of “being removed from the ACCSCT’s list of accrediting schools” in terms most clinical. It's as if losing its accreditation was a coincidental occurrence devoid of any negative connotation attached to Crown College itself. It was if they left the accreditation on the top of their car as they drove off and it fell off, just a happenstance, an unfortunate accident. According to article today in the Tacoma News Tribune, the revocation of Crown's College accreditation by the ACCSCT was the result of Crown's failure to place enough (70%) of the students in the fields they were training for. Thus, one could reasonably conclude that Crown's curriculum, facilities and/or faculty were inferior. Or, it could also be their reputation was such that employers were reluctant to hire their graduates.

The "management" of Crown, attribute their loss of accreditation to the supposed "turmoil" in education and Crown’s lack of nimbleness and finances. It is hard to understand how "turmoil" in education or nimbleness is relevant to their inability to place 70% of their graduates in the jobs they are paying Crown to train them to fill. However, the lack of finance might well be at fault, inasmuch as not enough money is going into the process of education vis a vis promoting or inducing students to attend. The amount of money charged, $17,000 a year for a truncated, quickie education program should pay enough for a good education considering how much less community colleges charge. Perhaps that money was not being properly utilized? More likely that money was obviously not being properly utilized! It was going into John Wabel's and Sheila Mullineaux's collective pockets instead of to a sound system that worked. The fabled Cloudroom that Mr. Wabel totes as so innovative has never worked right according to many of the students I have spoken to.

Crown College Loses ACCSCT Accreditation!

Finally, it has happened, Crown College's accrediting agency the ACCSCT could not ignore the antics and misadventures of John Wabel and Sheila Mullineaux (both pictured) and their merry gang of deceitful thieves who have been running a reverse Robin Hood scam, stealing from the poor and giving to the rich, mainly themselves. They have systematically instructed their admission representatives to lie to students about the transferability of their credits since at least 1998. About 50 victims of this fraud have come forth and the testimony of ten of them was instrumental to the jury finding that Crown College had violated the Consumer Protection Act in early 2006. It takes a "special" person to blatantly lie repeatedly to poor students who are attempting to improve their economical standing. A letter from the ACCSCT dated July 31, 2007, that it has revoked Crown College's accreditation. Unfortunately, many of the students that they swindled will not get their day in court or any other recompense. One of the reasons that Crown College was able to get away with their little charade was because they fell into a regulatory crack. Since they granted degrees the were not under the auspices of the WorkForce Board. Since they had been operating in Washington state for some time accredited by an agency recognized by the Department of Eduction, to wit, the ACCSCT they were exempt from the HEC Board. By virtue of the ACCSCT pulling their accreditation, they have lost that exemption. If they "reopen" they will have to apply to the HEC Board for approval. Hard to see how they will merit such approval and if they do, the HEC Board will certainly by a more stringent master than the ACCSCT and will not put up for their deceptive practices.

Hmmm, does that mean that regulation works, well eventually maybe and helped out by other factors, mainly a trio of successful lawsuits and the resulting mass of bad publicity. The ACCSCT has had Crown College on probation more times than Alan Sandler had bad dates. In fact, they were on probation when they were first sued back in January of 2006. A Pierce County jury found that they had violated the Washington State Consumer Protection Act and the judge awarded a $6,000 judgment and $77,000 in attorney fees. They settled another lawsuit for $87,000. Those lawsuits shined a decidedly unflattering light on the school. According to an article in the Puget Sound Business Journal, this may well be the final demise of a school which was built on not too subtle lies and deception.

There is an article in the Seattle Times about Crown College closing. I thought I might die from lack of oxygen, it being very difficult to breath while laughing. "Not a dry eye in the building." Who knew that crooks could cry, well apparently when it comes to be separated from their money. I wonder how many dry eyes are among their many student victims. Sheila Mullineux talks about how they are the Little Engine That Could School which is apparently the party line. In reality, they are a school that has generated money based completely on lies and they have lied with astounding impunity and a disregard for reality that is astonishing in its scope. They have probably built up such an immunity to truth such that their tongues might break out in sores if they spoke it! John Wabel denials that Crown's admission representatives lied to prospective students ratchets up in direct proportion to the evidence they they did. At the Gonzalez trial, one of the jury members told me that Mr. Wabel was his own worst enemy and he continues to be. In a Tacoma News Tribune they claim they will do some restructuring and reopen. Perhaps they mean the installation of truth monitors...

Approximately 50, and counting, former students have come forward and told attorneys or news media that they have been told by Crown College admission representatives that Crown College's credits would transfer to regionally accredited schools. Crown lost one lawsuit and settled two. There are two more pending lawsuits right now. Dale Pryor v. Killebrew/Dalton, Inc., John Wabel and Sheila Mullineux, Pierce County Case No. 07 2 060885 and Roberta Swigert and Janelle Page v. Killebrew/Dalton, Inc. and John Wabel, also in Pierce County Superior Court. In the second lawsuit, the plaintiffs have schedule a motion for default as the defendants have not filed an answer.