Minnesota settles $ 42 million university fraud case
State AG receives millions in a misleading university marketing battle.
Minnesota attorney general Keith Ellison has announced a $ 42 million preliminary settlement that will benefit 920 alumni of the Minnesota School of Business (MSB) and Globe University. The business school was on campus in northwest Rochester until both post-secondary schools closed three years ago and the U.S. Department of Education removed them from the federal student loan program. Subsequently, a Minnesota court found that these schools “committed consumer fraud by misleading students,” according to court documents.
In the fall of 2019, Ellison said, Minnesota Attorney General Keith Ellison’s office triumphed when the Minnesota Supreme Court ruled that the Attorney General’s office can reimburse tuition fees for fraudulently enrolled students. The AG said: Had the Supreme Court ruled against the attorney general today, only the 15 students who testified in court against MSB and Globe would be eligible for a total of $ 375,000 in tuition reimbursement. With today’s attorney general’s win, all former MSB and Globe criminal law students since 2009 – including 1,336 – have a total of $ 33.7 million in reimbursement claims. “
Photo by Ben Mullins on Unsplash
During the trial, Ellison’s office was able to show that MSB and Globe University’s “so-called criminal justice” program targeted students from low-income families, claiming it would “qualify them for jobs as police and probation officers, if so would not be the case. “The court found that” the spread of [MSB and Globe’s] false and misleading practices “was highlighted by” statements by several former employees … as well as statements by [MSB and Globe’s] Managers … advertising and mass advertising and … internal training materials. “The Supreme Court confirmed that the AG could seek a refund.
Ellison said after the decision, “Minnesotans of all origins just want to be able to afford their lives. Today’s verdict confirms my office’s authority to get money back for Minnesotans if they are harmed by fraud – in this case, low-income students who have been falsely told they could become police or probation officers in Minnesota by signing up for a program sign up that costs more than $ 70,000. These students believed they were taking out expensive student loans, spending hard-earned GI Bill achievements, and spending their savings on participating in a fraudulent program because the schools misrepresented them that this was a way of providing them and their families with better lives . when the schools knew it wasn’t. Instead, they had degrees they couldn’t use or loans they couldn’t transfer – and tens of thousands of dollars in debt. I am pleased that the Supreme Court has made it very clear that my office can restore these losses to the victims. “
Ellison’s office issued a press release following the $ 42 million preliminary settlement stating, “The courts have also canceled high-yielding student loans from schools and instructed institutions to issue reimbursements to the students concerned. About $ 3.7 million was returned to students in 2018 before the Minnesota School of Business and Globe Temple University filed for bankruptcy. Over $ 23 million from the settlement will be used to cancel outstanding federal student loan debt, while $ 15.6 million will be paid out as compensation for students on the criminal justice program, which has been the focus of consumer fraud. I hope the relief my office has got. If you have worked so hard to win, you can afford your life again after this horrific experience. “
Settlement benefits of $ 42 million for former Rochester School students
Attorney General Ellison’s office wins a huge win for betrayed MSB / Globe students