Florida Attorney General Opens Investigations Into 5 For-Profit Colleges

October 19, 2010

Florida's attorney general is investigating five for-profit colleges for possible misrepresentations about financial aid, deceptive recruiting tactics, and other practices, an official confirmed on Tuesday.

According to listings on the attorney general's Web site, investigators are seeking information from Argosy University, which is owned by the Education Management Corporation; Corinthian Colleges' Everest College; Kaplan University; the MedVance Institute; and the University of Phoenix.

The investigation will try to determine whether the colleges have violated Florida's law prohibiting deceptive or unfair business practices, said Ryan Wiggins, a spokeswoman for the attorney general.

The investigation was first reported by Dow Jones Newswires.

The for-profit sector has weathered months of intense federal scrutiny, amid proposed new regulations from the Department of Education designed to protect students from high-pressure marketing tactics and taxpayers from potential fraud and abuse of federal student-aid dollars. An undercover investigation of recruiting practices at 15 for-profit colleges by the Government Accountability Office, made public in August, found that the colleges often gave out deceptive information and that four of the colleges encouraged students to commit fraud.

The Florida investigations stem in part from the GAO's findings and from consumer complaints, but Ms. Wiggins declined to specify the source of the complaints or answer questions about other details. The listings on the Florida attorney general's Web site say the issues being investigated in each case are "alleged misrepresentations regarding financial aid" and "alleged unfair/deceptive practices regarding recruitment, enrollment, accreditation, placement, graduation rates, etc."

Officials with Kaplan and with the Apollo Group, which owns the University of Phoenix, said in e-mail messages that they had received no notification of any investigation by the Florida attorney general's office.

Representatives from the other colleges could not be reached for comment.