It’s been a busy week in student loan litigation news. In addition to the CFPB suit against ITT, the The New York Times reports that former employees have sued Harris (Premier Education Group), a for-profit trade school in New Jersey.
The complaint (filed in 2011 and unsealed in late 2013) reads like a catalog of the worst practices alleged by critics of the for-profit industry. The whistleblowers contend that school officials violated the False Claims Act by taking in federal student aid after knowingly enrolling students who could not pass basic literacy exams, falsifying entrance exam grades, passing students out of courses that the students had failed, forging students’ signatures on loan documents, and misleading students about their career prospects and eligibility to sit for professional licensing exams. If the plaintiffs are successful, the suit carries significant penalties, including treble damages.
This isn’t the first time Harris has been sued. The Press of Atlantic City reports that in March 2011, thirty-seven former Harris students brought suit against the school. Among the alleged violations? Misrepresentation of accreditation status, which meant that students were not eligible to sit for a required professional licensing exam, rendering their degrees worthless.