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A class action suit against Redstone College consisting of over 700 former students and 50 employees was launched against the school for complaints of systemic fraud. Students claim they were lied to about accreditation, job placement services and success, tuition, curriculum and feeds in order to get at their private and federal student loan funding. Westwood College is a sister college of the school and is named in the suit as well. A large corporate umbrella governed both schools Grant Corp., Wesgray Corp., Elbert Inc., Alta Colleges, Trav Corp., Paris Management Co., and Bounty Island Corp. George Burnett, acting CEO and director of Alta Colleges, and William Ojile, chief legal and compliance officer for Alta Colleges and its subsidiaries were named as defendants in the suit.
Redstone and Westwood claim the lawsuit is just a terrorem tactic intended to get lawyers heft fees should settlements occur and claim they are solely greed driven and not really about any complaints by former students. The schools claim the majority of their students have been satisfied with the education they received by the colleges. Burnett had previously been the chief marketing officer for Qwest Communications International which was fined $250 million for fraudulent statements on its income reporting by the SEC prior to working with the college. He took his predatory marketing practices and applied them to the school’s enrollment practices and internal and sanctioned policies.
One accrediting body, The Accrediting Commission of Career Schools and Colleges (ACCSC) had requested information from Westwood and Redstone which was required to maintain their accredited ACCSC status. The ACCSC removed their accreditation as the schools were not able to comply with student achievement standards. What makes this even worse is that multiple for-profits accredited by ACCSC had been sued over even that accreditation as its requirements were so lax the degrees earned with them were useless. This means that Redstone and Westwood turned out to be the worst of the worst as far as accreditation standards considering even the ACCSC wouldn’t accredit them.
The cost of a bachelor’s degree at Redstone or Westwood averaged between $68,174 and $81,905 and the suit claims this means the schools’ knowingly preyed upon the hopes and dreams of students and their desire to live better lives. The schools signed up as many students as possible for their programs which turned out to be absolutely worthless.
Further claims in the class action suit indicate that the school intentionally misled students about the cost of its programs by stating their per term tuition rates. Most institutions will have 2-3 terms per year, but Westwood and Redstone had 5 and students were charged for every one of them every year. Job placement success was also misleading as the schools would count minimum wage entry positions as a copy assistant at Kinko’s as a successful placement for the field of graphics design.
The school further misled students about its accreditation status as it indicated it was awaiting final approvals, soon to be forthcoming, for regional accreditation. This turned out to be a bald-faced lie as the schools had been denied regional standing. Students who were led to believe credits would be transferrable found out that no one would accept any credits from either school. As for admissions and enrollment representatives, they received financial compensation through promotions based on enrollment and were told if they failed to meet the minimum quota set out by the school that they would lose their jobs.
The class action suit named two plaintiffs, Amanda Krol and Krystel Bernal, which claim that their education rang in at a full $20,000 more than the stated amount by enrollment officials and that their total costs were $75,000 and $85,000. They had been led to believe they would be earning $100,000 per year in their fields, but when graduation time came, job placement counsellors told them to apply for minimum wage entry level positions in retail as they were setting their sights too high by trying to get jobs in the fields they’d trained in. Instead of job titles and hefty salaries they were promised, graduates found themselves working in positions that required no prior education which mind-blowing debt.
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If you feel you were defrauded by the school you attended or you are being treated poorly as a distressed borrower by your creditors, take the free challenge debt review to find out what options you have regarding your student loans.