The Department of Justice is suing one company of American for-profit colleges, arguing that the corporation violated the rules of federal financial aid.
According to an article by Brent Kendall in the Wall Street Journal:
The Justice Department on Monday sued Education Management Corp., alleging the company falsely certified that it was eligible to participate in federal student loan programs.
The department said the company’s compensation system for its admissions personnel violates the federal Higher Education Act because admissions employees are paid based on how many students they recruit.
Education Management Corporation has received more than $11 billion in federal financial aid in the last decade.
The Education Management Corporation is among the largest for-profit education companies in America. It owns several proprietary colleges, including Argosy University , The Art Institutes chain, Brown Mackie College, South University, and Western State University College of Law.