EXCLUSIVE: Whistleblowers in Stevens-Henager College lawsuit speak out

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OREM, Utah -- The federal government is suing Stevens-Henager College on allegations of illegally recruiting students and now an amended complaint says the problem is even more widespread.

Two former employees, turned whistleblowers, talked for the first time exclusively with FOX 13.

Nannette Wride worked at Stevens-Henager's Orem campus from 2009 to 2011. That's where she met Katie Brooks who was also a recruiter.

The two describe a cut-throat recruiting practice that they gradually began to question. It's a practice the federal government claims was illegal.

"I was told that every person I would sign up that I would receive a bonus," Wride said.

The government claims that Stevens-Henager's method to recruit students broke federal law and the college fraudulently obtained at least $660 million dating back to January 2002.

The U.S. Attorney's Office in Idaho names campuses across the west in its lawsuit to recover some of that money.

"A lot of the practices were shady. A lot of the people after I would sign them up and I would bring my concerns to my boss, I would say, ‘I'm really concerned about these students,’ he said, ‘it doesn't matter unless it counts on our circle,’" said former recruiter Katie Brooks

Brooks claims regardless of whether students were qualified or completed the program, as long as she signed students up, the bonuses rolled in and doubled her salary one year.

The whistleblowers’ lawyers filed an amended complaint Tuesday alleging that illegal commissions were part of a system-wide practice.

That's based on interviews with witnesses and former executives.

"Just confirms that, that the bonuses against federal regulations were being paid at all of these campuses," said Salt Lake civil attorney Joe Stultz.

Plus, there are also allegations recruiters targeted low-income and homeless populations.

"I didn't personally do that," Wride said. "But there was someone living under the viaduct that got signed up because he had a Social Security Number and was told he could live there and be warm through the winter and go to school."

Wride claims she also discovered a handful of faculty members at the Orem campus who weren't qualified to teach.

Stultz said that was also happening in Idaho.

"There were recent graduates from the college that were immediately being recycled into faculty members without having the proper amount of experience accredited to teach those classes," Stultz said.

Wride said when she brought it to the campus president's attention before she left in 2011, nothing was done.

Eric Juhlin, CEO of Stevens-Henager, referred FOX 13 to a statement he released Friday. You can read it in its entirety below but it says, in part, that the college followed federal law and regulations and "this lawsuit is an orchestrated attempt by two unprincipled, disgruntled former employees to use the legal system to extort money from the college."

"I could care less about money or anything else -- I just want to do the right thing and these people need to be called out," Wride said.

Wride now works as a respiratory therapist after earning an Associate’s degree at Stevens-Henager and believes her teachers were qualified but feels bad for other students.

Some have contacted her attorney saying they've been saddled with thousands of dollars in debt regardless of whether they completed their degree or not.

The whistleblowers' firm, Parsons Behle & Latimer, recommend students call state consumer protection advocates and say a class action lawsuit is unlikely and challenging because each student is in a different scenario.

They may want to contact an attorney individually to first determine if they have a case.

Read CEO Eric Juhlin’s full statement below:

Stevens-Henager College believes that the recently announced lawsuit is completely baseless and without merit and is providing this statement without further comment due to the pending litigation. Initiation of this lawsuit is an orchestrated attempt by two unprincipled, disgruntled former employees to use the legal system to extort money from the college.

The college’s compensation practices have always complied with federal rules and regulations, consistent with advice given to us by legal counsel, and we are confident that our practices will withstand any legal review.

1.     Stevens-Henager College is an ethical organization with decades of demonstrated compliance with applicable federal regulations and accreditation standards.

2.     Stevens-Henager College’s compensation policy for its admissions consultants, or any other employees involved in the enrollment process, does not allow for any bonuses or payments for simply enrolling students.

3.     Students who enroll into Stevens-Henager College’s degree programs must meet specific enrollment standards, including having a high school diploma or GED. We are passionate about supporting our students and helping them strive to improve their lives through education.

4.    Stevens-Henager College has a 123-year tradition of employing qualified faculty members with education, training, and experience in their respective fields. Our faculty, facilities, and curriculum are periodically and consistently reviewed by accreditors and other regulatory agencies.

5.     Unfortunately, organizations throughout the United States often find themselves having to defend baseless lawsuits. Stevens-Henager College is not immune to this tragic reality.

6.     Stevens-Henager College will aggressively defend itself against these allegations while remaining dedicated to providing our students with high-quality, ethical, and career-focused education and related services.

 

34 comments

  • JustSayin

    Suit filed a year ago but occured 2009-2011? wonder why the sudden interest in bringing this up? disgruntled sounds about right.

    Just for the record, money is not collected by a college until a student has completed a full semester. If the “homeless” person story is true, then that person would have had to stay as an active student for almost 4 months for the college to collect money from the student loan. Tuition is not paid up front. These ladies know this and it is obvious that they are telling un-truths.

    I wonder how much money they stand to make from this suit. So, if offered a “settlement” will they turn it down?

    “I could care less about money or anything else — I just want to do the right thing and these people need to be called out,” Wride said.

    sure….

    • grizzlypete

      Justsayinglies, it takes time for the federal government to investigate. it takes months just to get to a case, then several more months before they decide on the worthiness of the case.

      Stop lying,. Tuition is paid upfront. You are just writing things to make your employer look good.

    • Katie

      What they do (know from personal experience) is they include in the long long contract that you will owe that money regardless of finishing the semester or program that you have attended. Basically if you have to drop out for any reason you owe that college up to $80,000 depending on the program you have chosen and how much financial aid they took from you (all they can get like everything) the leftover is how much you owe the college no matter how long you attended. Shady yes but they include it in the contract.

  • Gina Latner

    Nanette wride is the widow of the officer that just dies in that horrible shootout, she has been in the news because his retirement money was denied or something i believe, im not blaming her for whistle-blowing but the fact she dont care about the money…. really?

    • Sandy

      GIna…She filed this complaint over a year ago. Long before her husband died. I’ve worked for this college. I had to quit because I could not do what they asked me to do. I was ruining peoples lives forever by the debt I was putting them into.

    • Chance Wride

      Hey Gina before you go assuming anything. Don’t say dumb things. This is my mom your talking about. And these case was filed almost two years ago. So seriously that’s pretty low and offensive at best that you would say what you did. You obviously don’t know anything about that college. So check your facts before you assume.

  • Matt

    This is a ridiculous accusation. I have been through the Admissions process at this location and I never felt lied to. These two employees are just trying to get money.

    I actually hilarious how they both worked there for multiple years and never had a problem. Now, years later they suddenly have a complaint? Really? Nan and Katie are pathetic at best.

    • grindingaxes

      Very mature…attack the messenger, not the message. Interesting you don’t dispute the truth of what they are saying, you only try to disparage their reputations.

  • youdon'tknow

    I know 3 people in my life that have been ripped off by this college. My father was in computer technician classes and was constantly showing up the teachers on how to do things. The teachers would end up asking him hope he did it the way he did after class cause they didn’t understand how he finished the class day before they even got done explaining how to do the asssignment. They ended up getting to the point the would tell him what the assignment was then 20 to 30 minutes later my father was done he died the teacher and the teacher left. SOME THINGS MY DAD ENDED UP TEACHING THE CLASS CAUSE THE TEACHER WAS TEACHING THEM WRONG! prove how teachers could be certified if a student ends up teaching the class some times!

    • JustSayin

      I tried really hard to be objective while reading your posting, but it was so poorly written that it appears the education line in your family ended with your dad. Do try and have better grammar when arguing a point.

      Show me your example has not happened at any other school in the technology field and I will bow to you.

      • Picklesdaddy

        I started the PC Tech program at Stevens Henager about 15 years ago. I also found myself correcting the instructor quite often. One nite, he pulled my out of one of my other classes to tell me that he would have me thrown out of the school if I ever contradicted him again. I decided that I didn’t need to incur any more debt if I wasn’t going to learn anything I didn’t already know. I left the school. One of my classmates later told me that instructor had been fired for sexual harassment of a student. I have since interviewed many Stevens Henager graduates for jobs. None of them could answer even the most basic technical questions.

  • Reba

    Quality education demands quality instruction from properly trained and educated teachers. Most PhDs have been in an assistantship where they learned to teach for 3 or 4 years before teaching any college class as a professor. Teaching is an art and science! You can’t just pluck someone out of the air and throw them into a classroom and expect them to know what they are doing.

    Even at our state institutions new faculty are funneled into a ‘teaching academy” to learn how to teach. Even if they come from a teaching background. Unfortunately, you get what you pay for. The for-profit schools are just that – for-profit.

  • Marla

    Seriously have been waiting for something like this. In my opinion they lied to me, about a lot of things! Here I am 2 years later with a useless degree and can’t find a job. I really want to call a lawyer now. I feel like I am stuck with all of these loans, but really got nothing out of the schooling.

  • grindingaxes

    Apparently, JustSayin and Tom are employees of Stevens-Henager, and ill-informed ones at that.

    Stevens-Henager starts receiving taxpayer money as soon as a student attends a handful of classes and earns all of it after the student attends about 80% of classes, even if they never complete the semester.

    You are also wrong about the timing of the suit, which was also controlled by federal law, which require these suits to be filed secretly.

    Try reading a story or two before you comment.

      • grindingaxes

        The complaint alleges the school falsified attendance records–so students did drop out in time, but the school said they didn’t.

  • stickybones30

    I attended this college. I was recruited while I was homeless and my only income was from my fiancée. He had ssi I was charged 30,000$ for my associates. I was not provided with the help I needed as they promised. After graduating they handed me a 4000$ bill of which I didn’t know about on top of all the fed loans. Btw I still can’t pay them. I still can’t find a job and on my income based repayment to the government they say my payment is zero. Granted that means this debt never goes away and counts against me. No I can’t buy a home and an apartment with a credit check is questionable. This school didn’t help me but it did kick me a little while I was down.

  • ripoffschool

    I know first hand that they take the money. My fiancé at the time (wife now) went there for 2 months they helped her get her Ged. They made her go through this basic learning class while they got her “classes” figured out. She sid that this basic learning class they did nothing. Pretty much just sat there for a few hours conversation about nothing. She ended up getting pregnant BEFORE they got the federal loan. So they claimed. Said that if we just paid them for the time she was there that there would be no other debt. THEY lied. We owe the federal government 4200. Sure they are low payments but there is nothing you can do about that. They are full of it and I hope this case brings them all the way down. As for us we will be paying for something she never received

  • Ken Rowland

    Once again…ITT TECH has the same format. These colleges are a scam. I went for 2 semesters and they charge me 11k. And also i was informed that I could Transfer my credits to a University. Lies, these schools do take FED funding up front no matter if you complete the program or not. Now i cant even sign up for a community college because my loans are in default. I cant afford payments and learned absolutely nothing. All I wanted to do was give my kids something to look up too and was kick wil I already down.

  • Jane

    I worked for a sister college for a few years. Eventually left because I couldn’t live with myself and what I was doing to peoples lives. We were given bottom benchmarks and if we didn’t hit those numbers, we were fired. Of course, every advisor is going to try and keep their job. We would try and enroll anyone we could. I received bonuses each month based on my performance but I was told they stopped doing that after I left. I left on good terms. So many students were misinformed and half of the students had no clue what they were signing up for. I hope for the students/graduates sake, they can keep their doors open, but I’ve been waiting for this to happen.

  • capsacin

    no one cares if you say I have a degree from a trade school. so why go to one? this isnt the first school to be sued by the govt. and if you were an employee questioning their methods…methods YOU are using why the hell would you continue to work there? “my boss told me to steal thousands of dollars from the federal goverment so I did.” are these whisleblowers really that stupid?

  • Clarity

    Re: their “non profit” status .. They became non-profit in the eyes of the IRS Dec. 31, 2012 but they are considered “for profit” by the Department of Education. Their DOE application to be non-profit hasn’t been approved and is still pending.

  • Pete

    My experience was a mix. Some teachers okay and others were horrible. One teacher didn’t show up for class a few times because she had fallen asleep in her car in the parking lot. Another one showed up and cancelled class because he just found out the day before that he was going to be teaching it and was not prepared at all. When we were supposed to learn on actual ventilators we watched a person come into the classroom and take the ventilators out because the company the school was renting them from needed them back, hard to learn a vent from a picture in a book where the pic is from 20 years ago. And 2 of my instructors would go thru the tests they were going to give and say, for example, question # 1 is on page 43 in the third paragraph and they would do this for every test. I still have the tex book with all the test numbers in the paragraphs. I can have several classmates even confirm this with me. Oh and let’s not mention one student going thru the respiratory program which was also teaching the anatomy class and sleeping with the director.

  • Richard Gordon Dodge Vadnais

    I went to the Ogden campus a few years back. About half way through my 3 year bachelors program they opened the new campus in Layton(right next to the hospital) which was supposed to be for the mediacal courses. They started scheduling half of my computer science classes there. I went in and talked to them several times and explained to them that I chose night classes at the Ogden campus because I can’t go any other time and don’t have transportation to get anywhere else. I was scheduled for 2 classes each semester and when they opened the Layton campus they would schedule one of them in Ogden and one in Layton. I miss 2 nights at the Layton class and told them i had to drop that class for the semester. Instead of trying to work things out they kicked me out of college half way through my program and left me with over $60K worth of student loans. I know 4 other people this happened too as well and have met several others who experienced similar situations in all different courses. Thanks guys I hope you’re college gets every single campus shut down.

  • Mike Alleman

    I don’t see how these women are going to benefit financially by going public. I do however wonder if they are going to return the money they made by engaging in the fraud they are alleging? Hmmmm….

  • Hulkster

    Justice News Banner
    Department of Justice
    Office of Public Affairs
    FOR IMMEDIATE RELEASE
    Thursday, May 8, 2014
    United States Files Complaint Against Stevens-Henager College, Inc. Alleging False Claims Act Violations for Illegal Recruiting

    The United States has filed a complaint under the False Claims Act against Stevens-Henager College, Inc. and its owner, The Center for Excellence in Higher Education, for illegally compensating recruiters, the Department of Justice announced today. Stevens-Henager operates a chain of for-profit colleges in Idaho and Utah.

    “Congress has made clear that colleges should not pay improper incentives to admissions recruiters,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “The Department of Justice and the Department of Education are working together to combat unlawful recruitment practices that can harm students and result in the waste of taxpayer funds.”

    In its complaint, the government alleged that the college falsely certified compliance with provisions of federal law that prohibit a university from paying incentive-based compensation to its admissions recruiters based on the number of students they recruit. Congress enacted the prohibition on such incentive compensation to curtail the enrollment of unqualified students, high student loan default rates, and the waste of student loans and grant funds.

    The claims alleged by the United States were initiated by a whistleblower lawsuit filed by two former Stevens-Henager employees under the False Claims Act, which allows private citizens to file suit over false claims on behalf of the government. The act provides for the recovery of triple damages and penalties, and allows the government to intervene and take over the allegations, as it has done in this case. The whistleblower is entitled to a share of any recovery obtained in the lawsuit.

    “Fighting fraud and protecting federal tax dollars from abuse is a priority for this office,” said U.S. Attorney Wendy Olson for the District of Idaho. “The False Claims Act is an important tool for doing just that. Whistleblowers are necessary to our ongoing efforts to combat fraud, waste and abuse.”

    This matter was investigated by the Commercial Litigation Branch of the Justice Department’s Civil Division, the U.S. Attorney’s Office for the District of Idaho, and the Department of Education, Office of Inspector General. The case is captioned United States ex rel. Brooks v. Stevens-Henager College, Inc., et al., Case No. 1:13-CV-00009-BLW (D. Id.). The claims asserted are allegations only, and there has been no determination of liability.
    14-484
    Civil Division

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