AG says Ky. college misrepresents job placements

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Associated Press

Posted on January 17, 2013 at 9:01 AM

FRANKFORT, Ky. (AP) — Kentucky Attorney General Jack Conway filed a lawsuit Wednesday against a prominent for-profit college with branches in the state's two largest cities, saying the school exaggerated job placement numbers that made it appear immune from tough economic times.

Conway accused Spencerian College of violating the Kentucky Consumer Protection Act by making unfair, false and deceptive statements in its promotional publications and website regarding the hiring rates of its students in their chosen professions.

In some cases, the job placement rates Spencerian promoted in its recruitment materials were 30 percent or 40 percent higher than the rates reported to its accreditor, Conway said. He also said the school falsely claimed to have 100 percent placement rates within some programs in years the country was struggling with high unemployment.

"I believe Spencerian College was more concerned about signing students up for classes and getting its hands on student loan money than educating students and placing them in jobs," Conway said. "The bottom line is they preyed on people who were trying to build better lives for their families in these tough economic times."

Spencerian operates campuses in Lexington and Louisville. Its attorney touted the quality of its programs and promised a vigorous defense.

"After a cursory review of the lawsuit, Spencerian College believes that the discrepancies alleged by the attorney general, if there are any, may be the result of different reporting periods with respect to job placement rates or as a result of the exclusion of program graduates who chose not to avail themselves of the career placement service, as is reflected on the subject advertisements," said the attorney, Grover Potts, in a statement.

"Some job placement rates have been reported by Spencerian College on a calendar year basis, and other job placement rates have been reported on a fiscal year basis," he added.

Spencerian is owned by Sullivan University System Inc. Sullivan says on its website that it is Kentucky's largest private college or university.

Conway said his suit seeks an injunction against Spencerian to prevent further deceptive practices. It also seeks civil penalties of $2,000 per violation. At any given time, Spencerian has about 2,000 students on both its Kentucky campus, he said.

"So if you do the math, it is a significant claim we're making for penalties under the Consumer Protection Act," Conway said.

Alleged violations stretched about four years, and his office received 48 complaints from Spencerian students the past couple of years, he said.

The suit was filed in Jefferson County Circuit Court. It's the fourth complaint Conway has pursued against the for-profit college industry as part of an ongoing investigation.

"It is apparent that the attorney general believes that all proprietary institutions do not provide worthwhile educational products," Potts said. "That is not the case for Spencerian College. Spencerian College has been providing quality career-oriented education for over 120 years."

Conway said that since at least 2007, Spencerian reported job placement rates to students through its website and in a publication. The school said those published rates were the same placement rates it reported to its accreditor, he said, but they were significantly different.

For instance, in 2008 Spencerian's Louisville branch claimed a 100 percent placement rate among students in its medical clinical specialist program, Conway said. But the placement rate reported to the accreditor was 67 percent. In 2010, the Louisville campus purported to have an 80 percent placement rate among its phlebotomy students, when the actual reported rate was 40 percent, he said.

At the Lexington campus, there was a 37.5 percent gap between the actual 2009 placement rate and the advertised rate in a phlebotomy-related medical assistant program, Conway said. Double-digit discrepancies were found in other programs at both campuses from 2007 to 2010, he said.

Spencerian removed the conflicting placement rates from its website after being confronted by the attorney general's office, Conway said.

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