Why There Is A Need For An EDMC Settlement Administrator

By Laura Hayes

With the saturation of some industries, it becomes an increasingly difficult task to solve the student loan and unemployment problem. No one can blame people for complaining. Companies like the Educational Management Corporation may even be held accountable for some cases of both debt and inadequacy of the professionals this institution churns out.

To prevent this from happening again settlements were made and new regulations were put in place. This is where the EDMC settlement administrator comes in. They are basically a third party service that reviews compliance with the new terms and agreements put up for the EDMC.

This kind of scrutiny is implemented because of the long running malpractice of recruitment and deceptive marketing by the organization. Recruiting personnel would receive commissions based on the number of enrollees they had. They deceived applicants into thinking that they were qualified and had programs accredited by authorized industry specific institutions, just to feign their credibility.

Graduates from this institution have a hard time getting internships and jobs because of the lack of accreditation and damaged credibility. The company falsely claimed their pursuance of the accreditation to their students to get their confidence. Now the company is under approximately 95 million dollars in payable debt. They are also required loan forgiveness to qualifying former students.

Legal action was put in place and has been effective since January 2016. The organization is now required to record online chats and phone calls with prospective students. Another daunting backlash is the drop in stock prices for this company, their rate going down to more than 75 percent since December 2013.

It was mentioned that loan forgiveness is given to former students. To qualify for this, first off, the student must have enrolled with less than 24 hours of credits if they were transfers. They also should have withdrawn from the EDMC school in 45 days since day one on their first term. Finally, their final school day should be in between January 1, 2006 and December 31,2014. Note that the settlement administrator does not have the authority to decide who can be recipients of this.

As third party, the settlement administrator is not an affiliate with the EDMC. Investigations and observations are meant to be unbiased and are there to help the client and general state attorneys from the 39 states that filed cases. While they may not be able to address complaints about Education Management, they can offer legal help and check on the compliance in the business they do with the organization.

These administrators investigate and make these eligible reports by listening to recorded phone calls, reviewing student complaints, looking at EDMC records and interviewing current and former students under the program. A summary containing a public report shall be provided annually. The said report shall be given to the state attorney general and the EDMC.

This kind of fraudulent activity results to unqualified professionals, the same ex students who are buried in student debt. These precautions and done for proper disclosure of costs and programs, marketing and recruitment. While the settlement agreement might prevent anymore scams, many say that the amount to be paid is not high enough to cover up for financial and moral damages.

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