Career Education (CECO) Updates on 'Show Cause' Directive for 10 Locations
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Career Education Corporation (CEC) (Nasdaq: CECO), announced that the Accrediting Commission of Career Schools and Colleges (ACCSC) voted to direct 10 Career Education institutions to show cause as to why their accreditation should not be withdrawn. The action stems from the accreditor’s ongoing information requests regarding student placement determination practices at these institutions.
CEC last month announced that the Accrediting Council of Independent Colleges and Schools (ACICS) lifted its similar “show cause” directive, which also centered on student placement determination practices. Much of the material requested by ACCSC overlaps with the information provided earlier to ACICS. Nine of the ten schools identified are dually accredited by ACCSC and ACICS. These schools were included in the prior directive by ACICS, which after reviewing the company’s actions and reforms regarding student placements vacated the show cause.
“We have been in ongoing communication and correspondence with ACCSC since we self-reported last year regarding student placements,” said Steven H. Lesnik, chairman, president and chief executive officer of CEC. “We maintain an open dialogue with ACCSC and intend to continue working directly with the accreditor towards a quick resolution.”
ACCSC set forth requirements for the institutions to demonstrate compliance with its accrediting standards, which include the submission of 2012 ACCSC employment placement rate data for each program offered at the ten institutions; engagement of an independent third-party to audit 100 percent of this employment placement rate data; additional analysis of previously submitted placement data; and an update regarding related regulatory inquiries. The company must provide this information to ACCSC no later than Sept. 7, 2012.
Last year, CEC discovered and reported issues it identified regarding the adequacy of administrative practices and controls relative to its schools’ determination of student placement rates. As a result, the company has taken a number of significant and previously reported steps in addressing placement determination practices, including:
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CEC last month announced that the Accrediting Council of Independent Colleges and Schools (ACICS) lifted its similar “show cause” directive, which also centered on student placement determination practices. Much of the material requested by ACCSC overlaps with the information provided earlier to ACICS. Nine of the ten schools identified are dually accredited by ACCSC and ACICS. These schools were included in the prior directive by ACICS, which after reviewing the company’s actions and reforms regarding student placements vacated the show cause.
“We have been in ongoing communication and correspondence with ACCSC since we self-reported last year regarding student placements,” said Steven H. Lesnik, chairman, president and chief executive officer of CEC. “We maintain an open dialogue with ACCSC and intend to continue working directly with the accreditor towards a quick resolution.”
ACCSC set forth requirements for the institutions to demonstrate compliance with its accrediting standards, which include the submission of 2012 ACCSC employment placement rate data for each program offered at the ten institutions; engagement of an independent third-party to audit 100 percent of this employment placement rate data; additional analysis of previously submitted placement data; and an update regarding related regulatory inquiries. The company must provide this information to ACCSC no later than Sept. 7, 2012.
Last year, CEC discovered and reported issues it identified regarding the adequacy of administrative practices and controls relative to its schools’ determination of student placement rates. As a result, the company has taken a number of significant and previously reported steps in addressing placement determination practices, including:
- Investigating and reviewing its placement practices through an independent outside counsel appointed by the Board of Directors;
- Setting new comprehensive placement guidelines to determine and clarify what constitutes and is reported to accreditors as a student placement;
- Verifying all student placements through a third party before they are reported; and
- Hiring more than 75 additional Career Service staff in schools accredited by ACCSC and ACICS to assist students in finding employment, while enhancing training, competencies and accountabilities for Career Services representatives.
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