“This case should serve as a warning that the State of Hawaii will not tolerate any school that engages in deceptive or misleading practices in marketing its curriculum to students”, said Stephen Levins, executive director of OCP.
As detailed in the agreement filed in court, OCP alleged that when Argosy was purchased by Dream Center Education Holdings in 2017, it falsely marketed to prospective students that it was a “nonprofit” institution. The OCP also alleged that the owners misled students about their ability to obtain degrees and provided misleading and incomplete information leading up to the school’s ultimate closure. The schools issued so-called “institutional loan debt” to students who were enrolled based on these marketing and recruitment practices.
Mismanagement by Dream Center ultimately led to insolvency and closure of Argosy schools in 2019, which upended the lives of Argosy students in Hawaii. The schools ended up entering federal receivership, a process similar to bankruptcy that can limit the financial relief available to students and other aggrieved creditors. Once in receivership, ownership of the institutional student debt changed hands, but OCP and the multistate group were able to secure today’s agreement with the entities that now control the debt.
Joining Hawaii in the settlement are the states of Minnesota, Arizona, Colorado, Florida, Georgia, Illinois, Tennessee, Utah, and Virginia. The agreement will be filed in the Ohio federal court overseeing the receivership.