Office of the Attorney General
Attorney General Conway Files Suit against Spencerian College

Press Release Date:  Wednesday, January 16, 2013  
Contact Information:  Allison Gardner Martin
Communications Director
502-696-5651 (office)
 


Attorney General Jack Conway today announced that his office filed a consumer protection lawsuit against Spencerian College, which is owned by the Sullivan University System, over allegations that the for-profit school misrepresented job placement numbers to consumers. This marks the fourth lawsuit General Conway has filed as part of his ongoing investigation of the for-profit college industry. Spencerian College operates two campuses in Kentucky – one in Lexington and one in Louisville.

The complaint, filed in Jefferson Circuit Court, alleges that Spencerian violated the Kentucky Consumer Protection Act by making unfair, false, misleading and deceptive statements in its publications and on its website regarding the rate at which its students were able to obtain employment in their field of study.

"Spencerian College provided students with information that it knew was false. The numbers substantially contradict data that it provided to its accreditors," General Conway said. "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. The bottom line is they preyed on people who were trying to build better lives for their families in these tough economic times."

The Attorney General's complaint details that since at least 2007, Spencerian reported placement rates to students via its website and by way of a published "interview book." Spencerian represented that the published rates, which in some cases were 100 percent, were the same placement rates it reported to its accreditor, ACICS. However, the rates were significantly different, sometimes with a differential of up to 40 percent. After Spencerian received a civil investigative demand from the Office of the Attorney General, it removed the conflicting graduation placement rates from its website.

The tables below outline the discrepancies uncovered during the Attorney General's investigation.

Spencerian College Louisville Branch

Reporting Year Program Name Advertised Rate Reported Rate Difference
2010 Phlebotomy 80.0% 40.0% 40.0%
2008 Medical Clinical Specialist 100.0% 66.7% 33.3%
2008 Invasive Cardiovascular Tech 67.0% 50.0% 17.0%
2007 Medical Assistant 100.0% 83.3% 16.7%
2007 Medical Transcriptionist 100.0% 66.7% 33.3%
2007 Medical Administrative Assistant 88.0% 75.0% 13.0%
2007 Phlebotomy 87.0% 77.6% 9.4%
2007 Limited Medical Radiology 88.0% 68.1% 19.9%
2007 Health Unit Coordinator 72.0% 62.5% 9.5%

Spencerian College Lexington Branch

Reporting Year Program Name Advertised Rate Reported Rate Difference
2009 Computer Graphic Design 44.0% 36.0% 8.0%
2009 Architectural CADD 60.0% 25.0% 35.0%
2009 Computer Engineering Technology 75.0% 55.6% 19.4%
2009 Phlebotomy 61.1% 50.0% 11.1%
2009 Medical Assistant with Phlebotomy 100.0% 62.5% 37.5%
2009 Medical Clinical Specialties 100.0% 66.7% 33.3%
2009 Limited X-Ray Machine Operator 100.0% 70.0% 30.0%
2009 Radiologic Technology 78.95% 53.3% 25.65%

 

The Attorney General's complaint seeks an injunction against Spencerian to prohibit further deceptive trade practices. The lawsuit seeks civil penalties of $2,000 per violation and recovery of investigative costs and attorney's fees.

Students who attended Spencerian College from 2007 until the present and who wish to file a complaint or provide information to the Office of the Attorney General may visit www.ag.ky.gov and click on "student complaints."

Combating Abuse in the For-Profit College Industry Attorney General Conway continues to lead a national bipartisan effort to examine potential abuses in the for-profit college industry. There are currently 30 states involved in the working group.

As part of this effort, General Conway filed suit in July of 2011 against Daymar College and on September 27, 2011 against National College over allegations that the for-profit colleges violated Kentucky's Consumer Protection Act.

In August of 2011, General Conway's office filed a motion to intervene in a whistle-blower suit against Education Management Corporation (EDMC), the parent company of Brown Mackie College, over allegations that the company illegally paid recruiters based on the number of students they enrolled in EDMC programs. A federal judge declined to let Kentucky intervene. The investigation into EDMC continues.

In addition, General Conway led an effort of 20 Attorneys General to secure a $2 million settlement with QuinStreet, Inc., the former operators of www.GIBill.com. The website was a funnel, generating sales leads for the for-profit college industry, which made representations that it was affiliated with the military and the United States Government. Under the settlement, the website's domain name was transferred to the Department of Veterans Affairs, where it now contains legitimate information about the GI Bill program. QuinStreet also agreed to make sweeping changes to all of its other education-related websites to address the states' consumer protection concerns.

A copy of the complaint filed in Jefferson Circuit Court can be found here: http://goo.gl/HBdM5