Settlement nets SC students $4.9 million in debt relief

Career Education Corporation, a national for-profit education company, has agreed to forgo collecting $4.9 million from South Carolina students as part of a settlement with the state’s attorney general.

The settlement is part of a larger federal agreement which would require CEC to reform its recruiting and enrollment practices and forgo receipt of about $493.7 million in debts owed by 179,529 students. In South Carolina, 2,510 students will get loan relief as a result of the settlement.

Attorney General Alan Wilson worked with 48 other attorneys general on the case, which arose after a five-year investigation showed deceptive practices misled students into going into debt to attend CEC schools. Those students were later unable to get jobs based on the education they received.

“This company misled South Carolina students who were trying to better themselves and left them with debts they couldn’t pay because they were deceived about their chances of getting jobs,” Wilson said in a statement.

CEC also agreed to pay the participating states $5 million. South Carolina will receive $50,000 of that money.

The attorneys general began investigating into CEC in January 2014 after receiving complaints from students and a critical report by the U.S. Senate’s Health, Education, Labor and Pensions Committee.

The investigation concluded that the company’s unfair and deceptive practices led students to enroll in the company’s colleges who would not have otherwise and afterward could not obtain professional licensure, while still owing debts to the company.

CEC denied the allegations but agreed to resolve the claims through the settlement.