2 Minnesota colleges have to pay back the students they defrauded

It's the latest in a string of setbacks for Globe University and Minnesota School of Business
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A couple of struggling Minnesota colleges learned Wednesday they'll have to repay tuition money to as many as 1,200 students who a court says were cheated by the schools' bogus claims.

The new court order is the latest piece of bad news for Globe University and Minnesota School of Business (MSB).

Their problems got serious last September when a court agreed with Minnesota's Attorney General that the schools had defrauded students in their criminal justice program by making false claims about their job prospects.

Wednesday's ruling says Globe and MSB will have to repay any criminal justice students who ask for their money back. That could mean paying back the tuition and other expenses for as many as 1,200 students.

Schools barely hanging on

The September fraud ruling led to last month's decision by the U.S. Education Department that federal student loans can no longer be used to pay tuition at Globe or MSB.

A couple weeks ago the schools closed their doors to new students, but say they're still working to help the 1,700 or so existing students at their 10 campuses finish their degrees or transfer to other schools.

Officials with Globe and MSB say the problems that led to the state's lawsuit were limited to the criminal justice program, which is no longer offered. "The Court’s final order was limited to one program – criminal justice – which has not been offered for more than two years and which represented no more than 4 percent of the Schools’ overall student population at any given time," they said in a statement to FOX 9.

Under the ruling, Globe and MSB will give the names of their criminal justice students to the state. The Attorney General's office will contact them to let them know they qualify for getting their money back. The former students and alumni will have 45 days to file a claim.

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