SETTLEMENT WITH FOR-PROFIT NATIONAL EDUCATION COMPANY BENEFITS ITS FORMER STUDENTS

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January 16, 2019


Media Contact: Liz Brocker (701) 328-2213

Career Education Corp agrees to forgive almost $500M of student debts.

BISMARCK, ND – Attorney General Wayne Stenehjem announced that 151 North Dakota former students of the for-profit education company Career Education Corp (CEC), will receive student loan debt relief totaling more than $340,000. The debt relief is one of the conditions of a national settlement that CEC entered into earlier this month with Stenehjem and 48 other attorneys general.

“I am very pleased the efforts of this Office and the other Attorneys General have resulted in significant debt relief for North Dakota students who may have been misled about job placements or professional licensure and, unfortunately, were burdened with huge debts they could not repay,” said Stenehjem.

Under the terms of the agreement, CEC will change its recruiting and enrollment practices and forgo collecting about $493.7 million in debts owed by 179,529 students across the country. CEC will also pay $5 million to the states. North Dakota’s share will be $40,000. 

The settlement capped a five-year investigation of CEC, initiated after the attorneys generals received complaints from students and a critical report on for-profit education by the U.S. Senate’s Health, Education, Labor and Pensions Committee. Among other questionable practices, the investigation found evidence that CEC:

  • deceived prospective students about the total cost of enrollment by informing them only about the cost per credit hour, not the total of required credit hours;
  • misled students about the transferability of credits and that some of its programs were not accredited; and
  • deceived prospective students about the rate that graduates of CEC programs got a job in their field of study.

As a result, its students were saddled with substantial debts that they could not repay or discharge.

Illinois-based CEC currently offers primarily online courses through American InterContinental University (AIU) and Colorado Technical University (CTU). In addition, CEC has closed or phased out many of its schools over the past 10 years, including Briarcliffe College, Brooks Institute, Brown College, Harrington College of Design, International Academy of Design & Technology, Le Cordon Bleu, Missouri College, and Sanford-Brown.

Under the agreement, CEC will not collect debts owed by students who attended a CEC institution that closed before January 1, 2019, or those whose final day of attendance at AIU or CTU occurred on or before Dec. 31, 2013. Former CEC students should contact CEC for more information about how to obtain their debt relief.    

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