For-profit school to pay $1.6M to feds

Staff Report
Posted: July 22, 2011

Chi Institute has agreed to pay $1.6 million to resolve allegations the for-profit school in Broomall failed to provide students with an educational program it had promised, according to the U.S. Attorney's Office.

The settlement resolves allegations raised by a whistle-blower about a Chi program at its Broomall campus for a surgical technology diploma.

The allegations said that CHI misled students and the federal government about the number of spots available for field training necessary for students to graduate from the program.

The result, according to the allegations, was that students paid CHI for an educational program that CHI knew it could not fully handle, the U.S. Attorney's Office said.

The majority of students in the program received some form of federal student financial aid.

Chi is a career-focused, technical and vocational institute, and is subsidiary of Kaplan, Inc., which is owned by The Washington Post Company.

The money CHI has agreed to pay will go to satisfy the student loans of the students in the surgical program, fulfill payments to the federal government for losses associated with the financial aid, as well as payments to the whistle-blower, according to the U.S. Attorney's Office.

The case was investigated by the Department of Education Federal Student Aid Office and the Department of Education Office of Inspector General. It was prosecuted by Assistant United States Attorney Michael S. Blume.

Contact the Online Breaking News Desk at online@phillynews.com or 215-854-2443.   

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