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Downtown education center accused of misconduct

Jason Cato
| Thursday, Sept. 4, 2008

Two former instructors are suing a Downtown higher education center, claiming the school illegally rewards admissions recruiters, dupes prospective students with false promises about their futures and encourages teachers to pass failing students.

Victoria Gatsiopoulos and Dolores Howland, former instructors at Kaplan Career Institute's ICM campus on Wood Street, accuse their former employer of violating U.S. Department of Education policies for schools receiving federal funding, the federal lawsuit states.

The school baits prospective students "with false promises of how their lives will magically change if only they would attend ICM," attorney Sam Cordes wrote in the 17-page complaint unsealed Tuesday.

Kaplan faces similar allegations in federal lawsuits in Florida and Illinois filed by four former employees, including a former admissions director and dean.

Hunter Hopkins, director of Kaplan's Downtown school, could not be reached for comment.

Kaplan spokeswoman Michele Mazur of Chicago said the Pittsburgh lawsuit lacks merit and the school never has been found to have violated any laws.

"We are committed to building an institution of higher education of the highest quality," Mazur said. "Our record demonstrates that we run an institution of the highest integrity. Kaplan's mission is to help individuals achieve their educational and career goals. We build futures one success story at a time."

Gatsiopoulos of Beechview and Howland of McKeesport are suing under the False Claims Act that allows whistleblowers to fight corruption on the government's behalf.

"My clients would get a reward from money collected for the government, if we win," Cordes said Wednesday.

The lawsuit seeks between $5,000 and $10,000 for each infraction, plus legal fees and other damages. Gatsiopoulos, hired in 2000 and fired in December, wants her job back. Howland worked for Kaplan from 2000 to July 2006. It is not clear what led to Howland's departure.

The complaint was filed in November 2006 but kept secret while the government investigated the claims. Assistant U.S. Attorney Paul Skirtich in July wrote to U.S. District Judge David S. Cercone that the government wasn't "able to decide whether to proceed with the action at this time."

The lawsuit claims Kaplan officials knowingly violated provisions of the Higher Education Act since at least 2002 by requesting and accepting federal money while ignoring the incentive compensation ban, providing students with less-than-honest statistics about job placement and failing to help students acquire state licenses required in certain fields.

In 2005, admissions workers who signed up enough students were treated to a trip to Puerto Rico, the lawsuit states.

A graduate's crew leader position at a fast-food restaurant was reported as being in the criminal justice field, and an accounting management graduate was counted as landing a job in his field after being hired as a Wal-Mart sales associate, according to the lawsuit.

The Higher Education Act provides certain funding for schools with a job placement rate of 70 percent or better. The lawsuit accuses Kaplan of skewing its statistics to meet that requirement.

The complaint claims one admissions representative wooed a prospective student in writing by telling her that within five years she'd have a job in a hospital, "a big house" in Florida, enough money to take her family to Disney World and would drive a Lexus.

Some students who did not graduate from high school were coached to pass an entrance exam, and instructors were pressured to count absent students present, track down dropouts and pass flunking students, the lawsuit states.

"Students who never should have walked through the door in the first place are spending money for an education from which they cannot even benefit," the lawsuit states.

Kaplan officials declared an internal investigation revealed "everything was fine," the lawsuit states, after Gatsiopoulos and Howland threatened to take their complaints to the Education Department, inspector general and state accreditation board.

Kaplan's Pittsburgh campus is accredited by the Accrediting Council of Independent Colleges and Schools, the Department of Education and the Council for Higher Education Accreditation.

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