by David Walker
A lawsuit against the nation's second largest operator of for-profit colleges has cast a spotlight on the company's recruitment practices and ethics, including those of a chain called The Art Institutes, which offers degree programs in photography and more than 55 other creative fields at more than 45 locations around the country.
Earlier this month, the US Department of Justice sued Pittsburgh-based Education Management Corporation, which is 41 percent owned by investment bank Goldman Sachs. The government has charged the company with fraudulently collecting $11 billion dollars in state and federal student financial aid between July of 2003 to June of 2011. EDMC allegedly collected $2.2 billion of that money in 2010 alone. That amounted to almost 90 percent of the company's 2010 revenues.
The government says EDMC violated federal rules against paying recruiters based on the number of students enrolled. Those rules are designed to prevent colleges from recruiting unqualified students just to collect student aid money.
EDMC operates more than 100 schools under the names Art Institute, Brown Mackie College, South University, and Argosy University. According to former recruiters and photography students contacted by PDN, many Art Institute graduates leave with tens of thousands of dollars in student loan debt, and insufficient professional qualifications or job prospects to pay the money back.
Taxpayers are on the hook for the loans that students cannot repay.
EDMC has denied the government's claims. Jacqueline Muller, EDMC's VP of communications/public relations, told PDN in an e-mail, "We are proud of the success earned by many Art Institute alumni in all program areas, including photography." Art Institutes have some noteworthy graduates including Pulitzer Prize-winning photographers Carol Guzy (1980) and Martha Rial (1982).
But according to its critics, EDMC and AI's strategy has been to sell a dream of a lucrative career aggressively--and sometimes deceitfully--to low-income high school students who often lacked the skills and preparation to succeed in college, or the knowledge to explore less expensive educational options.
"They're preying on these [students]," says Suzanne Lawrence, a former recruiter for Argosy University who has turned government witness in the case against the company. "EDMC is not a public service organization. They're not trying to educate people. They're just trying to filter this government [student aid] money to their stockholders."
Muller says, "We offer a pathway to a higher education for many students who are not being served by traditional higher education." She also says that EDMC balances the interests of its students and shareholders. "The best way to meet investor expectations and success is to ensure that our students are successful," Muller says. "The two are not incongruent."
EDMC institutions have few admissions requirements beyond a high school diploma or GED. According to former recruiters who spoke to PDN, almost anyone--ready or not--can get in. "We were recruiting students who had no actual skills," Lawrence says. Muller says EDMC's schools are accredited and licensed by the states in which they operate, and that "interest and desire to attend our schools drives admissions, not demographics."
At the Art Institute of Pittsburgh campus alone, there were reportedly about 600 photography students pursuing a bachelor of arts or associates degree as of last summer, says Kathleen A. Bittel, the whistleblower whose testimony before a US Senate committee last fall helped trigger the federal lawsuit against EDMC. Bittel was a recruiter for Argosy University and then a career counselor for Art Institute's online division.
"Where are 600 photography graduates going to go? You cannot absorb that many in one city. How are they going to make money?" she says.
Bittel says EDMC had plans last summer to increase its photography student enrollment by adding a 12-15 month diploma to the program. The new degree was intended to attract students who wanted a "quick fix" in the form of a degree they could earn faster than an associate's degree with minimal effort, Bittel says. "If the bachelors students can't find jobs, where are the students with [12-month diplomas] going to go?"
EDMC focused recruiting efforts on low-income students not only to take advantage of their eligibility for government loans, but because they were "easy prey," says Bittel. "They don't know how the educational system works. They don't know if the deal they're getting is a good one or a bad one."
"If you didn't grow up with everyone in your family going to college, there's nobody to tell you, 'That's not a real school,' and there's nobody to tell you that you can take your grant money to another school," such as a community college or state school, says Lawrence.
Recruiters were under intense pressure to sign students up. According to Bittel, Lawrence, and Josef Bookert, who was a career services counselor at the Argosy University in Pittsburgh, recruiters were reprimanded and frequently fired for not meeting increasingly demanding enrollment goals, and managers made public examples of them to pressure other recruiters by fear and intimidation. "You got the numbers or you were out," Bittel says.
Bittel says pressure to enroll students increased after EDMC went public in 2009. The caliber of students declined as a result, Bittel says. "The quality of [graduate's] portfolios dropped, and then when the economy it was impossible" to place students in jobs related to their field of study after graduation.
"They would say whatever they had to, to get people in the door [to enroll]," says Bookert, the career counselor, who says he sat among recruiters and overheard their sales pitches. "The managers had culpability. They knew what was happening. I never heard anyone say, 'Lie to the students,' but I heard blatant lies every day."
For instance, recruiters told prospective students they would have no trouble getting high paying jobs in their field of study (whether photography or another program) upon graduating, and that they could easily pay back student loans. (Officially, Art Institute says more than 85 percent of its graduates get jobs within their field of study. Bittel and others say EDMC's method of counting is dishonest and the actual number is much lower. EDMC says on its web site that two investigations it conducted "found a lack of support for Bittel's claims that [EDMC] encouraged career services advisors to improperly report job placements.")
Bittel says that EDMC recruiters are more careful now about what they tell students because "they [management] realized they're being watched. But when I was there, recruiters were telling students all kinds of outrageous things, and that was being encouraged by administrators."
Recruiters also played on the emotional vulnerabilities of prospective students, according to Bittel and Lawrence. Lawrence says she and other recruiters were trained to "dig, dig, dig," for a prospect's so-called "confirmed [psychological] need," and then use it to pressure them to enroll. For instance, if a prospect said something like, "My DAD was never proud of me," the confirmed need was to make his or her father proud, explains Lawrence, who holds a master's degree in psychology. The recruiter was then supposed to try to reel in a wavering prospect by asking, "What about your father? Don't you want to make him proud?"
"I felt like I was using my skills for evil," says Lawrence, who holds a master's degree in psychology. "Those conversations basically turned into therapy sessions. They start to trust you, tell you about their problems, what's going on in their lives, and you use that to get them to enroll. It's very disingenuous."
Another part of the training was to gloss over the high cost of tuition, and the student loan debt that accrues. Bittel says recruiters were trained to tell prospective students the price per credit hour (about $500) and tell them that each class was three credits.
"We were told to let them do the math," she says, adding that they rarely did. "A lot of people saw the price per credit, thought that was the price per class, and didn't add it up."
Muller, the EDMC spokesperson, says total degree program costs is "easily available" on Art Institute's web site.
"You come in, someone at EDMC helps you get loans, and it feels like it's free until six months after you graduate," when the loan payments come due, says Bookert. "A big selling point is that you come to school and get educated, and worry about money later."
The reality hit as students approached graduation with huge debts, and few job prospects after all. "Students would get mad at me and say, 'What am I supposed to do with this degree?'" says Bookert. "[The cost] is very visible to [recent graduates] carrying $90,000 worth of debt they were supposed to start paying off."
"It was soul sucking," says Lawrence, who quit after six months to take another job. "You're really kind of ruining peoples' lives. There's no nicer way to put it."
Several former students interviewed for this story corroborated what former recruiters said about AI's recruiting methods. They also reported a lot of difficulty finding work as photographers and paying their debts.
Sarah Boger, of Austin, Texas, graduated from the Art Institute of Colorado in Denver with $105,000 worth of student loan debt. (One quarter of it was from Brooks Institute, a for-profit photo school not owned by EDMC that she attended prior to enrolling at Art Institute.)
Boger wanted a career in "live event and concert photography," and contacted the school after seeing its ads on TV, she says. "Ideally I wanted to work for Rolling Stone or Spin. They made it sound like if I went [to AI], they would help me find a job. They said 90 percent of their graduates are employed [with]in one year in their field. They said, 'We have contacts at all the major music magazines.'
"I think [the recruiter] was telling me what I wanted to hear, because when I got out, they didn't have anything," Boger says. An AI career counselor gave her just two contacts at small publications in Austin. Boger was unable to reach one because that contact had moved to another job, "and the other said to me, 'You don't have the qualifications you need,'" Boger recounts.
Eventually AI career counselors stopped returning Boger's calls for help, she says. Now she works as a tech support specialist for non-profit web sites--"nothing to do with my degree," she says. At one point she was trying to pay off her student loans by holding down three jobs. Now the loans are deferred, but Boger says she doesn't think she could pay them off even if she had a good job as a photographer. She's planning to pay off the debts instead with money she inherited from her mother, who recently died.
"I loved the teachers [at AI]," says Boger, "But the monetary value wasn't worth what I put in. The results are not going to happen as fast as they say. It's like they're pumping photographers out like little cookie cutters."
Another disillusioned graduate is Don Orkoskey of Pittsburgh. He got an associate's degree in photography from Art Institute of Pittsburgh in 2001 (which pre-dates the period covered by the federal lawsuit), then returned in 2003 for a degree in web design after deciding the photography degree wasn't getting him anywhere.
"I was young and stupid, and didn't understand that I could go to a traditional university and get the degree I wanted until I was in the thick of it," he says.
He now runs his own photography and web design business, but gives little credit to AI for his success. "The degree you get prepares you for an entry level position that you could get with no degree," he says, explaining that he eventually took courses at the University of Pittsburgh to learn the web design skills he needed to succeed.
He says, "I hate to get down on folks who get swept in because I was one of them. I spent five years in high school, smoking pot, looking for the easy way out, not willing to take things seriously or work hard.
"Art Institute sees those students, and latches onto them. They say, 'You'll be a photographer, or a graphic designer, or a chef." Orkoskey says he was receptive because he was hearing from everyone--his mother, his teachers, and politicians--that he'd be a failure without education.
The cost of attending AI didn't hit Orkoskey until after he graduated, and he was told he had to make loan payments amounting to $600 per month to pay off the debt. When he couldn't pay, lenders began pressing his mother--who had co-signed some of his loans--for the money. Orkoskey worked in data entry, retail inventory, and other jobs unrelated to photography for several years, before he got the education he needed to start his own business. But he's still paying off his AI debts, he says.
Others interviewed for this story had mixed views. They had enthusiastic praise for AI instructors, and credit the school with teaching them photography skills they believe will help them succeed. "You can see the people who are going to come out and have significant careers. Then there are those who are there because it's their only option," says Patrick Day, a mid career IT professional who attended Art Institute of Raleigh-Durham (North Carolina) because he lacked a college degree. "The school offered me the opportunity to get a degree while I'm still working;" nearby state and community colleges didn't, he says.
"I don't feel that they're a paper mill. The instructors all have master's degrees and experience in the industry. But it's ungodly expensive for what it is. If you look at a full bachelor's degree, it's in the neighborhood of 60 grand. If I went to North Carolina State, I could probably do it for a quarter of that."
Muller, the EDMC spokesperson, notes that career colleges including the Art Institutes "have long demonstrated success in their ability to meet the educational needs of the non-traditional student who has largely been ignored by traditional colleges and universities."
Photographer Brandon Werth, who graduated from Art Institute of Minneapolis in 2010, says his wedding and editorial business is going well. "I have to attribute a lot of my success to what I learned in school. I feel like they train you and help you get jobs."
Werth says he didn't do well in high school, and didn't realize art school was a college option until his step father mentioned the idea. He checked out the Minneapolis College of Art and Design, "but they have this pompous attitude toward art. I felt it was the wrong crowd for me to be with.
"It felt right at Art Institute," he continues. "My mom thought [the recruiters] were pushy. I could sense that. It was like one of those car salesmen deals....Yeah, there's a dark side. It seems like they didn't care who they brought in. They just wanted money."
But his instructors, he hastens to add, "Were the best thing that ever happened to me in terms of my life as an artist and my growth as a creative person." Students get out of it what they put in, he says.
Werth still has $80,000 in student loan debt. "I sometimes question whether it was worth it," he says. "Pulling myself out of debt to make a living is going to be a struggle but I'm just brushing it off."
His goal is to pay off the debt in about five years, and he's optimistic. "Business is going better than I thought it ever would."
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