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Management Briefing
Loretta W. Prencipe

Admission commissions at IT 'mill schools' dupe perspective students

SLAM. THAT'S THE SOUND of the doors shutting at Computer Learning Centers (CLC) after the Manassas, Va.-based IT training provider filed bankruptcy in January. Surprise. The U.S. Department of Education is sending a message to the IT training industry: Clean up your act or face stiff repercussions. But is that enough?

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In December, the agency called for CLC to return some $187 million. This, says the agency, is a portion of federally backed student financial aid monies that CLC wrongfully received from 1994 through 2000. CLC CEO John L. Corse wants to make it clear that this is not a fine. Not a fine, strictly speaking, but it seems to be a big penalty.

This all comes down to compensation. The Department of Education simply says that CLC admission representatives' salaries were based on their success in securing student enrollments. That, says the agency, is a violation of the Higher Education Act, making for a federal law and financial aid no-no.

Corse says CLC has toed the no "admission commissions" line since 1994.

Bull, says the agency. And here's why: CLC admission reps' performance standards, and thus their salary levels, were weighed heavily toward the average number of financed and documented students.

Review the Final Program Determination Letter that the department sent CLC in December and you'll find a clue. From 1994 to at least December 2000, CLC paid reps a flat salary rate. That's good.

But to hit a higher salary rate, a CLC admission rep had to increase his or her monthly average of enrolled, financed, and documented students. That's not so good. Show an increase in the number of students likely to finish, or even graduate, and you get no raise.

Rumors abound about the ludicrous promises and pressure tactics employed by "education mills." Insiders at many a retail mill operation say that the pressure to increase admission numbers is constant and outweighs any consideration of whether a potential enrollee has technical aptitude or will likely finish the training.

Consider the mills' target students, the unsuspecting and naive. The "schools" close the deal -- sometimes in as little as two weeks -- on the aspiring entrant's IT paycheck dream. The promise is that they'll be making the big bucks after graduation, and all they will need is that training certificate, no real-world experience required.

For someone seeking opportunity, a student enrollment and a loan agreement seems like the right path. For an admission rep trying to fill a quota, the ability to do the coursework be damned.

IT hiring managers and recruiters know the truth. Résumés listing perfect grades or MSCE training received from some mills are sent straight to the manager's circular e-file. The grads just cannot do the work.

Little wonder. At some facilities, students find outdated equipment, shared computers, and instructors in and out a revolving door. That's no way to spend time or dollars.

The "mill" sell begins with the advertisements -- heard on the radio, seen on television, and read as banner ads everywhere. It all seems to be false advertising. And if I remember my law school training, doesn't consumer protection from misleading advertising come under the aegis of the Federal Trade Commission? So when will the FTC get involved? Shouldn't someone take up the cause of the IT-uninitiated as they are promised jobs and astronomical starting salaries?

It took the Department of Education some six years after the 1994 "no admission commission" regulation was issued to stop the practices at CLC. Is it going to be 2007 before the FTC gets off its duff?


Loretta W. Prencipe is an attorney, a startup survivor, and a senior editor at InfoWorld. You can reach her at loretta_prencipe@infoworld.com.




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