Education Management Corp. (EDMC), the second-largest for-profit education company in the country, will pay the United States $95.5 million to resolve allegations that it violated the False Claims Act by falsely certifying that it was in compliance with Title IV of the Higher Education Act and state statutes. The primary allegation was that EDMC unlawfully recruited students, in contravention of the statutes’ Incentive Compensation Ban, by running a high pressure boiler room where admissions personnel were paid based on the number of students they enrolled.

“This historic resolution exemplifies the Justice Department’s deep commitment to protecting precious public resources; to defending American consumers; and to standing up for those who are vulnerable to mistreatment, abuse, and exploitation,” said Attorney General Loretta E. Lynch.  “Operating essentially as a recruitment mill, EDMC’s actions were not only a violation of federal law but also a violation of the trust placed in them by their students – including veterans and working parents – all at taxpayer expense.  In the days ahead, we will continue working with our invaluable partners at the U.S. Department of Education, through initiatives like the inter-agency task force on for-profit education, to ensure that our nation’s aspiring learners are finding and gaining access to educational opportunities that are right for them.”