Texas Workforce Commission implements new rules governing for-profit colleges

We’ve reported before on the disinterest the TWC has in policing these commercial colleges, often using WFAA stories as a basis. We found that one former TWC employee, Frank Hammack, moved from the state agency over to an administrative position at ATI Career Training Center.

Most recently, federal agents raided the offices of American Commercial College.

According to a sealed federal court complaint, filed under the False Claims Act and obtained by Texas Watchdog, ACC, a 50-year-old enterprise with locations in six cities in Texas and Louisiana, falsified documents to obtain loans and grants for a number of students, who turned the money over to the college for a promise of a portion of the proceeds.

The complaint, filed by two former employees of ACC, also claims the college has obtained private loans, with the assistance of a local banker, for students in order to satisfy the federal requirements that a college receive no more than 90 percent of its overall tuition revenue from public funds.

Under the scheme being investigated, ACC obtained the personal loans for the students so that its books would pass the annual audit of funding sources, then paid that money back to the bank after the college passed the audit.

Students are told that without their signing of the private loan papers, “the school would fail and their money and time would be wasted,” according to the complaint.

Several students have signed on to another suit against the school, alleging the school misled them on job prospects and that the school obtained loans in their names without their knowledge.

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Contact Steve Miller at 832-303-9420 or stevemiller@texaswatchdog.org.

Photo of ‘college fund’ by flickr user 401K, used via a Creative Commons license.