AG Ferguson obtains more than $7M in student debt relief for thousands of Washingtonians from for-profit college

Sunday, January 13, 2019

OLYMPIA — More than 3,000 Washingtonians will receive more than $7.6 million in debt relief from Career Education Corporation (CEC), a for-profit higher education company, as part of Attorney General Bob Ferguson’s legal action over the company’s use of deceptive practices to attract potential students.

The most debt relief an individual Washington student will receive is $59,000. The median amount of debt relief is $1,463.

In addition to debt relief and other injunctive terms, the company is legally required to disclose to prospective students accurate information about cost, graduation rates, job placement rates and median debt for graduates.

“Student borrowers victimized by deceptive recruitment practices deserve loan relief and legal protection,” Ferguson said. “My office will hold accountable any for-profit college that tries to take advantage of the aspirations of Washington students.”

Students do no need to take any action to receive relief. CEC will notify all eligible students of their debt relief within 60 days. Former students with questions about their eligibility may contact CEC.

CEC misled students about the total costs of enrollment at its institutions. The company did not disclose that some of the programs lacked the necessary professional accreditation, leaving students unable to obtain employment or the licensing they needed to continue in their fields.

The company also misrepresented the job placement rates of past graduates. When calculating job placement rates, CEC included graduates who only worked temporarily — even as little as one or two weeks — or were employed in a field unrelated to their degree.

CEC told students that credits from their institutions could be transferred to other institutions. In reality, it was very difficult or impossible for students to transfer to a non-CEC school.

The company owned two physical locations in Washington, both located in Tukwila. Some Washingtonians may still be attending CEC schools through online programs.

Today’s resolution is a result of a multistate investigation into CEC’s deceptive and misleading practices. Washington and 47 other states investigated the company’s recruitment practices and found that CEC misrepresented the cost of attendance, graduation rates, expected future salaries for graduates and job placement rates. CEC will forgo collecting more than $493.6 million in debts owed by nearly 175,000 students nationwide.

Assistant Attorney General Craig Rader handled the case for Washington.

To assist student loan borrowers in Washington, the Attorney General's Office has compiled a Student Loan Survival Guide. This guide provides tips and links to resources to help high school students thinking about attending college, former college students who are not able to keep up with their payments, parents of students and everyone in between.


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