For-profit college operator Ernesto Perez — a big-time donor to South Florida politicians — officially pleaded guilty Monday to illegally bundling more than $159,000 in campaign contributions.
Perez, who owned Dade Medical College, will surrender in January to begin serving house arrest and probation.
Perez’s official sentence is three days in jail, but because the college operator is receiving credit for time already served, there will be no additional days behind bars.
The plea deal was first discussed last week when Perez was arrested on the campaign finance charges. It was postponed until Monday so attorneys on both sides could work out the details.
Perez receives three years of probation, plus two months of house arrest. The college owner agreed to pay $150,000 to law enforcement for the cost of the investigation — $95,000 of which he has already paid, lawyers announced.
Perez will also make $50,000 in required charitable donations. The college owner will not be required to pay any restitution to his former students — Miami-Dade State Attorney’s Office spokesman Ed Griffith said this is because the criminal charges settled on Monday dealt with Perez’s personal conduct, and not the actions of Dade Medical College.
The closure of Perez’s schools displaced 2,000 students and left 400 employees jobless.
Perez must appear in court to start his probation on Jan. 5 . He faces six years in prison if he does not show up.
Perez is still facing a separate criminal probe into suspected financial irregularities involving student loans.
Monday’s plea deal also resolved lingering perjury charges from when Perez was arrested in 2013. Back then, the college owner had been charged for repeatedly failing to disclose his criminal history when filling out government forms. When Perez was appointed to serve on Florida’s for-profit college oversight agency, the Commission for Independent Education, he allegedly failed to reveal that he pleaded no contest in the early 1990s to misdemeanor charges of battery and exposing his genitals to a 15-year-old. He spent six months in jail for that offense.
Perez was also arrested in 2002 on a charge of aggravated battery, but avoided jail through a pretrial diversion program.
The Miami Herald recently obtained documents showing that, in at least three instances, Perez also failed to disclose his criminal past when requesting permission to accept federal GI Bill funding for veterans. The documents ask “have any owners, officers, or principal stockholders (10% or more of outstanding stock) ever been convicted for violation of any law other than minor traffic violations?”
Perez checked no, and signed at the bottom that “I HEREBY CERTIFY” that the information is accurate. The documents could create both criminal and civil liability for Perez. Perez’s criminal defense attorney, Michael Band, declined to comment.
Griffith, the state attorney’s office spokesman, said his office was aware of these documents but determined that the statute of limitations had run out for those forms, and Perez therefore could not be criminally charged.
On Monday, prosecutors reduced Perez’s 2013 perjury charge to a misdemeanor, resisting arrest without violence.
Perez’s for-profit college empire collapsed in recent weeks, with all six Dade Medical campuses closing on Oct. 30. Dade Medical’s smaller affiliate school, the University of Southernmost Florida, also went out of business that same day.
Weeks before the closure, the U.S. Department of Education had put both schools on a heightened monitoring status, which slowed down the flow of financial aid dollars — the lifeblood of for-profit colleges. Perez’s schools were also struggling with mounting debts.
The two colleges enrolled about 2,000 students, and operated campuses in Miami, Homestead, Miami Lakes, Coral Gables, Hollywood, West Palm Beach and Jacksonville.
Students say they were left tens of thousands of dollars in debt, with college credits that won’t transfer to traditional schools. Many of the college’s 400 employees say they were stiffed on their final paychecks.
Both students and ex-employees have started filing lawsuits.
A month and a half ago, at a Sept. 24 ribbon-cutting for a new terrace at the USMF Coral Gables campus, Perez was surrounded by four state senators and a Gables city commissioner — politicians who stood by him even though he was the target of a criminal investigation.
At that event, Perez compared his school to innovation in the taxi industry. He told the Coral Gables city-run TV station that “I believe that we are the Uber of education.”
“It might not be the way you usually get there, but we do get you there,” Perez said.
Perez and other school administrators quickly vacated their corporate headquarters after the surprise closure — leaving students confused, panicked and without access to their transcripts.
Florida’s for-profit college oversight agency, the Commission for Independent Education, has managed the crisis from its Tallahassee office, 488 miles away.
I believe that we are the Uber of education.
Ernesto Perez, before the closure of his school
Under the CIE’s own rules, it’s supposed to send a staffer in person when a school closure happens. The CIE is run by the same industry it is charged with policing — a majority of its members are for-profit college executives.
A recent Miami Herald investigation, Higher-Ed Hustle, highlighted how for-profit colleges have become big business in Florida. The schools enroll nearly one in five students, donate generously to politicians, and get close to 90 percent of their revenues from taxpayers, in the form of federal Pell grants and student loans.
State Rep. José Javier Rodríguez, a Miami Democrat who has called for greater oversight of for-profits, has organized a Thursday town hall forum to help the displaced Dade Medical College students. The event will be at 6 p.m. at the Shenandoah Middle School auditorium, 1950 SW 19th St., Miami.
The CIE was notified of the meeting, but it will not be sending a representative. Rodríguez said the CIE will not be sending anyone for “several more weeks.”
Other Tallahassee lawmakers are also starting to push for stronger student protections at for-profit colleges. On Monday, state Sen. Jeff Brandes, a St. Petersburg Republican, filed a bill that would require new for-profit colleges to maintain a surety bond or escrow account that could be used to help students if a school abruptly closes. The bill would also would require schools to use a standard format to disclose to students “all fees and costs they will incur to complete the program.”
About 20 former Dade Medical College students gathered outside Sen. Marco Rubio's office in Doral Monday morning, hoping to get some kind of response or help from the presidential candidate.
Five of them were allowed onto the premises and spoke with Rubio's regional director, Alyn Fernandez. The staffer handed out forms for the students to voice their concerns.
Rubio has received at least $5,300 in campaign contributions from Dade Medical, and at least $24,000 from the “career college” industry, which is mostly for-profit schools.
El Nuevo Herald staff writer Sergio N. Cándido contributed to this report.