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Education Affiliates, a for-profit chain with 50 campuses, has settled with the federal government over false-claim allegations, the U.S. Department of Justice said. The Maryland-based company agreed to pay $13 million in response to allegations that it received aid payments from unqualified students, some of whom the for-profit admitted by creating false or fraudulent high school diplomas. Education Affiliates also referred prospective students to diploma mills, according to the feds, and falsified students' federal aid applications.
“The various cases that were settled here include numerous allegations of predatory conduct that victimized students and bilked taxpayers,” said Under Secretary of Education Ted Mitchell, in a written statement. “In particular, the settlement provides for repayment of $1.9 million in liabilities ordered by Secretary of Education Arne Duncan that resulted from EA awarding federal financial aid to students at its Fortis-Miami campus based on invalid high school credentials issued by a diploma mill. Secretary Duncan made clear that such abusive behavior would not be tolerated, and we will continue to work with the Justice Department and other federal agencies to ensure that postsecondary institutions face consequences when they violate the law.”