Career Education Corporation on Monday disclosed that the Accrediting Council for Independent Colleges and Schools has asked the for-profit higher education provider to demonstrate the adequacy of "administrative practices and controls relative to the company's reporting of placement rates." A recent review by an outside law firm found that some of the company's 49 health education and art and design schools did not have sufficient documentation to back up job placements, and that 13 failed to meet the accreditor's placement rate requirement. Career Education's president and CEO, Gary E. McCullough, resigned shortly after that news broke.
The company will present to the accreditor next month on the discrepancy, and "continues to take corrective action," according to the disclosure to investors. The accreditor released a statement about the matter this month, saying: "We are currently conducting an internal review of our processes for evaluating placement rates, including a review of data collected from site visits and audits of Career Education Corporation from the last few years, to determine why those problems were not detected.”
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