A single mother was looking for a way to improve her family’s future in 2009 when she decided an education at Vatterott College would be her key to success. Like thousands of others, Ms. Jennifer Kerr, who was then living partially on state assistance, had seen Vatterott’s ads on television. When she went to the local campus and told the admissions representative that her dream was to be a nurse, the representative told her that although the school did not offer a nursing degree, it did offer a medical assistant’s degree. That degree, she allegedly was told, would help her earn $15 to $17 an hour and, with the transfer of her credits, put her on the “fast track” to becoming a nurse. Only none of that happened.
After securing more than $27,000 in loans and being in the program for nearly 60 weeks, Ms. Kerr was shocked to learn that she wasn’t even enrolled in the medical assistant’s program. Instead, she was enrolled in the preliminary medical office assistant’s program. Ms. Kerr was told that if she wanted to continue on and get the medical assistant’s degree, it would take a total of 90 weeks and cost her about $10,000 more.
A jury ruled for Ms. Kerr in her lawsuit against Vatterott, finding that the Missouri-based Vatterott Educational Centers Inc. had violated the Missouri Merchandising Practices Act. The corporation was ordered to pay Ms. Kerr $27,676 in actual damages and $13 million in punitive damages. Vatterott, which was started in 1969, has 19 locations in nine states, most of them in Missouri. It also has a large online enrollment, according to the company’s website. The jury verdict will give Ms. Kerr the money to repay thousands of dollars in federal loans for a certificate of completion as a medical office assistant that she said has been all but useless to her.
This case is not the first to cast a negative light on the for-profit college industry, which has long been criticized for enrolling students into expensive courses of study that deliver degrees or diplomas that lead to few job or at best, low-paying jobs. In 2010, an undercover investigation of 15 for-profit colleges (not including Vatterott), conducted by the U.S. Government Accountability Office, (GAO) revealed, among other findings, that “four colleges encouraged fraudulent practices and that all 15 made deceptive or otherwise questionable statements to GAO’s undercover applicants.” Four undercover applicants were encouraged to falsify financial aid forms to quality for federal aid.
Other colleges exaggerated applicants’ potential salaries after graduation and underestimated the total cost of their programs. Although some of the colleges did provide applicants with accurate and even sound advice, such as not borrowing too much money, others pressured applicants to sign contracts for enrollment before allowing them to speak to financial aid advisers. Last year, U.S. Sen. Tom Harkin of Iowa released the results of a two-year investigation into some 30 for-profit colleges that included Vatterott. Among the Senator’s findings, covering 2008 and 2009, were:
- Students who attended for-profit colleges accounted for 47 percent of all federal student loan defaults.
- Because 96 percent of students who enroll in for-profit colleges take federal student loans (compared to 13 percent at community colleges), nearly all students who leave have student-loan debt, even when they do not have a degree or diploma or increased earning power.
- Most for-profit colleges charge significantly more than similar programs at community college or even flagship state universities.
- In 2008 and 2009, more than 1 million students started at schools owned by the for-profit companies examined in the investigation. By mid-2010, 54 percent had left school without a degree or certificate; among associate’s degree students, 63 percent left without that degree.
Vatterott made national news itself in 2009 and early 2010, when three top Vatterott employees, including Kevin Earl Woods, the former director of the Kansas City campus, pleaded guilty to roles in a conspiracy to fraudulently obtain federal student grants and student loans for students who were ineligible for such loans between August 2005 and July 2006. After Ms. Kerr left Vatterott, she tried for six months to find full-time employment. Earning her medical office assistant diploma, not only placed her deep into debt, which she could not repay, but the degree was not even necessary to become a medical office secretary. The diploma she received was for all practical purposes worthless.
Ms. Kerr contacted the Missouri attorney general and a lawyer was found who would take her case. She initially took a part-time job, working in a cafeteria lunchroom and she now works full-time making baked goods for a large corporation. Ms. Kerr says “It’s a good job.” She supports two children, ages 6 and 12. Ms. Kerr was represented by Martin Myers, a lawyer with The Myers Law firm located in Kansas City. He did a very good job for her.
Source: The Kansas City Star