Continuing Education, Domestic, Ethics, For-Profit, Required, Student Loans - Written by on Saturday, July 23, 2011 9:17 - 3 Comments

Kaplan Inc. Subsidiary, CHI Institute, to Pay $1.6M in Fines

photo: flickr user Peter E. Lee

by Elbert Chu, updated

CHI Institute, owned by The Washington Post Company (NYSE:WPO) through its subsidiary, Kaplan Inc., failed to provide promised educational programs to students enrolled in a surgical tech course. This comes on the heels of the announcement of a shake-up in Kaplan Inc. executives on Tuesday. reports:

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 New York Times Tamar Lewin reports details of the settlement:

Kaplan, in settling the case, admitted no wrongdoing.

The settlement includes nearly $500,000 to be paid on behalf of 43 students who had taken out student loans for the program but were not able to graduate because the school, one of Kaplan’s for-profit campuses, had no placement for them.

“The money will go to the banks, to pay off their loans, so the students can get on with their lives,” said Michael J. Salmanson, the lawyer who handled the case.

One of those whose loans will be paid off is Rebecca Masci, a single mother of five, who took out loans, got her parents to baby-sit and, for three terms, excelled in her classroom work. But she was unable to graduate because the school never provided the necessary hands-on experience in an operating room.

Mr. Salmanson said other students whose loans will be paid off may not have known of the lawsuit — and may not yet know about the settlement.

Mr. Salmanson and Mr. Goodstein will receive $225,000 of the settlement money.


CHI Institute: Super Fishy.


New York Times article. article.


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Jul 23, 2011 15:49 doesn’t ever report anything – they got this straight from the DOJ website. All the philly media sites have had this info for a long time and sat on it-guess they all are too scared of WaPo. Shame on them b/c this happened in their own backyard

Wired Academic
Jul 25, 2011 16:58

Hi Tim, Thanks for your response. That is a troubling allegation.

Jul 26, 2011 16:58

Believe it. I have inside information that’s extremely reliable.

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