US intervenes in whistleblowers' case against college for student recruiting violations

by Ben Vernia | May 8th, 2014

On May 8, the Department of Justice announced that the United States was intervening in a qui tam case against an Idaho-based college and its owner, alleging illegal incentive payments to student recruiters. According to DOJ’s press release:

The United States has filed a complaint under the False Claims Act against Stevens-Henager College, Inc. and its owner, The Center for Excellence in Higher Education, for illegally compensating recruiters, the Department of Justice announced today. Stevens-Henager operates a chain of for-profit colleges in Idaho and Utah.

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In its complaint, the government alleged that the college falsely certified compliance with provisions of federal law that prohibit a university from paying incentive-based compensation to its admissions recruiters based on the number of students they recruit. Congress enacted the prohibition on such incentive compensation to curtail the enrollment of unqualified students, high student loan default rates, and the waste of student loans and grant funds.

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