U.S. joins suit to recover funds from Education Management Corporation

August 08, 2011|By Terry Frieden, CNN Justice Producer

The Justice Department joined a whistle-blower and several state governments Monday in filing suit against a for-profit educational firm that has received more than $11 billion in federal student aid.

The government joined the suit against Education Management Corp. (EDMC), which has enrolled thousands of students in dozens of educational programs across the U.S. The government alleges the company paid admissions recruiters bonuses tied to the number of students they recruited, in violation of federal law.

Assistant Attorney General Tony West at the Justice Department said the company had misused federal educations funds by paying improper incentives to admissions recruiters. “We will protect both students and taxpayers from arrangements that emphasized profits over education,” West said.

Many of the educational programs or “colleges” carried the name of The Art Institute of the city or state in which it was located. Several other schools carried the name Argosy University.

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Our office represents several students in claims against Argosy at their Dallas campus. If you have any information regarding that campus please contact us.