ATI Career Training Center looked like dozens of other private career colleges that dot South Florida’s educational landscape. It offered hope of a new career, a path into prosperity, an escape from poverty.
According to a whistleblower suit filed by Dulce M. Ramirez-Damon, a former assistant director of education at the Fort Lauderdale campus, the school was an elaborate fraud.
Settlement of the lawsuit was announced last week. As a result of the litigation:
• ATI has agreed to pay $3.7 million, while acknowledging no wrongdoing.
• The company is being liquidated under the auspices of a crisis management firm.
The suit alleged ATI recruited its students from homeless shelters and strip clubs. It allowed non-English speakers to fill slots in English-only classes, where they comprehended nothing. It doctored transcripts, fudged grades, ignored non-attendance and set rigid recruitment quotas, all with one goal — so students, some of whom never set foot on campus after the first week, could qualify for federal loans grants that were paid directly to ATI. The students were saddled with the debt.
“It was a real bad deal for everybody, except for the people at the top making money,” said Miami attorney John Hickey, who represented Ramirez Damon in the lawsuit, along with associate Bjorg Eikeland. “It was a bad deal for the students because they didn’t get a useful education. It was a bad deal for the U.S. government and the American taxpayer, who really got ripped off.”
Ramirez-Damon’s False Claims Act complaint was filed in secret in July 2011 — the secrecy being standard until the government had decided whether to take up the cause, which it did this past Aug. 7 for the purpose of achieving a settlement.
The suit alleged that ATI had engaged in a “systematic and nationwide fraudulent practice of forging documents and records to create an appearance of student eligibility in order to receive federal funds.” A similar whistleblower action was filed in federal court in northern Texas in 2009. Both suits have now been made public.
A Department of Justice news release said ATI’s payment would resolve allegations it “falsely certified compliance with federal student aid programs’ eligibility requirements and submitted claims for ineligible students.”
ATI also allegedly misrepresented its job placement statistics to authorities in Texas in order to maintain its licensing and accreditation, the release said.
Federal prosecutors in Miami, Washington, and Texas investigated, along with the Department of Education’s Inspector General.
“Federal financial aid is there to help students attain their dreams and goals, and misuse of these funds to increase corporate profits is unacceptable,” said Miami U.S. Attorney Wifredo Ferrer in a news release. “We are committed to ensuring that federal student aid is used for the benefit of students.”
ATI has changed hands a couple of times in recent years, with the current owner being Texas-based Ancora Holdings.
But according to interim CEO Michael Gries, “all of these allegations” engulfing ATI occurred under the leadership of former ATI Chief Executive and Chairman Arthur E. Benjamin, a resident of Delray Beach.
Benjamin, who now runs Salt Lake City-based Stone Mountain Investments, did not return a phone message left with his office.