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Florida for-profit college chain to pay $600,000 over false financial aid claims

Nursing students at Florida Technical College.
Nursing students at Florida Technical College.

A for-profit Florida college chain reached a $600,000 settlement agreement with the Department of Justice on Wednesday over allegations that college employees submitted false federal financial aid claims.

Employees at Florida Technical College’s Cutler Bay campus allegedly submitted false documents showing that 27 students had high school diplomas or the equivalent when the students did not, according to a statement from the U.S. Attorney’s Office for the Southern District of Florida. This practice increased the college’s enrollment numbers, resulting in more money from the federal government “at the expense of taxpayers and students, who incurred long-term debt,” the statement says.

“Federal financial aid is meant to help qualified students obtain a quality education from an eligible institution, and we are committed to ensure colleges comply with the rules to make certain that federal financial aid is provided to those individuals it is meant to assist,” U.S. Attorney Benjamin G. Greenberg said in the statement.

FTC cooperated with the investigation and no longer employs the admissions staff and managers who were involved, the U.S. Attorney’s Office said. According to the terms of the settlement agreement, the claims are considered allegations and no liability was determined.

“This resolution allows FTC, which fully cooperated with the government’s investigation of the allegations raised in the civil action, to focus on its core mission of providing its students with the knowledge, training, and skills needed for a career in Healthcare, Business, Information Technology, Culinary Arts, Criminal Justice, HVAC and many other fields,” FTC President James Michael Burkett said in a statement.

The alleged fraud was uncovered by a whistle-blower at the Cutler Bay campus, a former administrative assistant who filed a lawsuit in 2016 under the False Claims Act, which allows whistle-blowers to sue on behalf of the government.

According to the initial complaint, employees at the Cutler Bay campus tried to enroll as many students as possible in the college, whether or not they were qualified, which resulted in more financial aid money flowing into FTC.

The Miami Herald spent a year investigating Florida's for-profit colleges - conducting scores of interviews and reviewing tens of thousands of pages of documents. Here's what it found.

One student, for example, was enrolled even though she didn’t have a diploma or GED, according to the complaint. When an admissions representative reported the issue, the complaint says, a supervisor told the admissions representative to “keep it quiet.” After it was discovered that unqualified students had been enrolled in the school, however, they were “dropped at their own peril” but were not in a position to repay the financial aid, leaving the government with debt that can’t be collected, the complaint says.

Improperly enrolling students without high school diplomas or their equivalent has been an issue at other Florida for-profit colleges, a 2015 Miami Herald investigation found.

FTC was founded in 1982 and offers bachelor’s degrees, associate’s degrees and diploma programs. The college chain has six campuses in Florida, including the Cutler Bay campus. The other campuses are located in Pembroke Pines, DeLand, Orlando, Kissimmee and Lakeland.

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