Westwood College reached a settlement Tuesday with Colorado's attorney general, who had accused the company of deceiving prospective students about costs, transferability of credits, and the jobs and salaries of its graduates. The for-profit college, which has 17 campuses in six states as well as an online division, will now be required to make clear disclosures about a variety of recruiting claims.
Westwood, owned by the privately held Alta Colleges Inc., also agreed to pay the state $2-million in penalties, restitution, and legal fees, and to pay an additional $2.5-million in restitution to students who borrowed from a college-run loan program to cover some of their tuition.
As part of the settlement, Westwood agreed that its admissions interviews will be subject to monitoring by the attorney general for three years, and that it will submit yearly audits of the data it uses to prepare reports on the employment of its graduates. In its complaint, the attorney general's office said its investigation found that Westwood misrepresented and falsified its job-placement statistics by counting students as employed in their field even if those jobs had little to do with their field of study.
As part of the settlement, Westwood admitted no wrongdoing.
The deal is one of a series Westwood has reached in recent months. In October, it quietly settled a high-profile case brought by former students represented by a law firm that used a Web site called "WestwoodScammedMe" to identify potential witnesses and plaintiffs. The terms of that settlement are secret. The "dispute was resolved to the satisfaction of the named parties," Westwood said in a statement issued at the time. "As a result, all litigation filed by the James Hoyer law firm against Westwood College has been dismissed. The law firm is neither accepting any further clients nor participating in any other litigation against Westwood College."
The law firm declined to comment and referred questions to a prerecorded message that said the dispute was "resolved to the satisfaction of the named parties."
Sen. Tom Harkin, whose investigation into for-profit colleges has focused on Westwood, questioned whether the financial penalties of the Colorado settlement were adequate; he said they represented just 4 percent of Westwood's 2009 marketing budget. The senator, a Democrat from Iowa, also said the issues highlighted by the settlement, and those raised by other agencies' actions, were cause for continued scrutiny of Westwood. "I strongly urge Westwood's accreditors and the responsible federal agencies to immediately review whether the school has the sufficient institutional integrity and academic quality to continue receiving taxpayer-funded financial aid," he said in a statement Wednesday.