Minnesota AG sues 2 for-profit colleges that 'exploited the dream'

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In a lawsuit filed Tuesday, Minnesota Attorney General Lori Swanson alleged that the Minnesota School of Business and Globe University, which are held under common ownership, have systematically deceived their students.

The Star Tribune reports the two Minnesota for-profit colleges are accused of misleading graduates about job opportunities and their ability to transfer credits to other higher-education institutions. That has burdened them with thousands of dollars in school loans and little chance of finding employment.

“Going to college has long been a way for people to try to make a better life for themselves,” Swanson said at a press conference, where she stood flanked by students who had attended the colleges. “The schools exploited this dream for some students, who are now saddled with debt.”

The Pioneer Press added that Swanson described a "sales-oriented culture" at the colleges. The attorney general's lawsuit centers on the degrees offered in criminal justice, which Swanson said were recommended to students seeking careers as probation or police officers. The school lacks the accreditation or certification needed for its graduates to get such jobs in Minnesota, Swanson said.

Officials with the schools issued a statement Monday afternoon denying Swanson's claims.

"The claims that our admissions practices and credit transfer policies are deceptive could not be further from the truth," said the statement.

With regard to the criminal justice program, the schools say that prospective students are informed by admissions staff that the program does not fulfill Minnesota Peace Officer Standards and Training requirements needed to become a police officer.

The schools also pointed out that decisions about credit transfers are made by the receiving institution.

"While it is unlikely that credits will transfer to state colleges or universities, some institutions accept Globe University and Minnesota School of Business credits," said the statement.

Globe University and the Minnesota School of Business serve more than 11,000 students on campuses in five states and online. The schools are jointly headquartered in Woodbury, and operate campuses in Blaine, Brooklyn Center, Elk River, Lakeville, Minneapolis, Moorhead, Plymouth, Richfield, Rochester, Shakopee and Woodbury, with seven campuses in Wisconsin and one in Sioux Falls.

Swanson's lawsuit seeks injunctive relief, civil penalties, and restitution. Swanson said she expects the suit's scope to expand.

In 2012, MPR News produced a story that detailed allegations that the two schools went after "...students eligible for subsidized loans and grants, but who have low prospects for academic success." The story talked to former recruiters and staff at the two schools who came forward to expose the schools' tactics, and noted that ads for colleges "...tend to attract a desperate, low-income clientele. Such students are in for a hard, often misleading sales pitch once they contact the schools for information."

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