Nov 5, 2009 10:36 pm US/Mountain
National Career College Faces Class Action Lawsuit
Written for the Web by CBS4 Special Projects Producer Libby Smith
DENVER (CBS4) ―
A Colorado-based national chain of career colleges is under fire. Former students are claiming in an arbitration action that they were deceived about the value of their degrees and the true cost of their education.
Westwood College serves 17,000 students on 17 campuses across the country and online. The career college offers degrees in just three years in fields like criminal justice, interior design, video game art, among others. While many students end up with good jobs, others claim they were tricked by high fees and false promises.
Jessica Espinoza and her husband, Nathan, graduated from Westwood. They still owe more than $100,000 together on their loans. When Jessica inquired to the University of Denver about getting a master's degree in business, she received a letter telling her "Westwood college is not regionally accredited. Therefore we cannot consider you for admission to our graduate degree programs."
"We were both kind of stunned because here we are owing this huge amount of money for an essentially worthless piece of paper, so I was furious," Espinoza told CBS4.
CBS4 Investigator Rick Sallinger contacted a variety of other Colorado colleges about credit transfer some said outright that they would not accept Westwood credits, others said they would accept them under certain conditions. Westwood officials point out that the enrollment contract that students sign states that there is no guarantee of credit transfer. The college has applied for regional accreditation but a decision is still pending before the Higher Learning Commission.
Earlier this year, Westwood settled a lawsuit in which the U.S. Department of Justice joined former Westwood employees to accuse the career college of using false claims to get students to enroll in order to receive federal funds. The suit was filed in Texas four years ago. Westwood settled it in May paying $7 million, but admitting no wrongdoing. One issue cited in the lawsuit was the practice of providing lavish incentives to admissions agents for signing up students.
"Yes, there was a lot of lying going on," said Joshua Pruyn, a former admissions representative for Westwood.
Pruyn told CBS4 that there were competitions for trips to Mexico, time off, gift cards and more.
"They'll say whatever needs to be said to a student to enroll him in the school," Pruyn explained.
"It's interesting when we hear ex-employees make claims like that – we have very strong ethical requirements of all of our employees especially for those who represent us to the public at large or students," said Russ Natoce the Chief Marketing Officer for Westwood College.
The college has now stopped the practice of awarding admissions representatives with trips.
Westwood provided CBS4 with several students who wanted to tell us how satisfied they are with the college including its admissions representatives.
"For somebody to talk bad about Westwood, it really is disheartening because this school tries so hard to make everybody succeed," said Tonya Cunningham, a Westwood graduate now taking additional courses.
A bachelor's degree from the college costs between $66,000 - $77,000. A video that Westwood used to display on the internet explained financial aid options including its own loan program called APEX. The video explains that monthly payments on the APEX loan are usually no more than $150 per month while the student is in school. It didn't explain the interest rate on the loan after a student leaves the school. Staci Andrews dropped out of Westwood after a term-and-a-half and she was shocked to see the interest rate was 18 percent on her APEX loan.
"I was told I would have all grants and found out later that I had signed up for a whole bunch of loans I didn't even ask for," Andrews told CBS4.
CBS4 employees paid two visits to Westwood College and inquired by phone about the APEX loan. They were told about the $150 a month payment while in school, but not about the 18 percent rate that comes later.
"That was another thing that was often lied about was what percentage interest rate that loan is or it would be misleading," Pruyn added.
Westwood officials point out that the rates are clearly noted on documents the students must sign.
"Are students being told everything they need to know up front, or are they finding out about things later?" Sallinger asked Natoce.
"That's a great question. We try as much as possible to make sure we've got full disclosure and full transparency for all of our students," Natoce responded.
Since our inquiries, Westwood college has decided to reduce the interest on its APEX loans to 10 percent for new enrollees. Also, it claims it has suspended interest payments for others although the students we contacted were not aware of that.
(© MMIX CBS Television Stations, Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
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