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The U.S. Department of Education has fined a Michigan university $2.5 million for “material misrepresentation” of career accomplishments over many years.
In a Tuesday news release, the department said its investigation into Baker University found that the school’s misrepresentations “harmed students who could reasonably rely on this information when considering higher education options and potential outcomes.” It was announced that it was found that there is a possibility of giving
The federal review began after a joint investigation by ProPublica and the Detroit Free Press in 2022 detailed the university’s low graduation rates and the high debt many students carry. It was done. The university has promoted a near 100% placement rate for decades, but an investigation found that was based on shaky self-reported data. The nonprofit university has consistently spent more on marketing than on financial aid, and experts have identified conflicts of interest in its governance structure.
In 2023, news outlets, along with the Chronicle of Higher Education, reported on the university’s growing financial problems.
As part of the settlement, the university will no longer make any misrepresentations, will provide marketing materials to the department for review over a three-year period, and will provide current students and staff with instructions on how to submit complaints and information to the university. I agreed to tell him. Suspicion of misconduct.
President Jackie Spicer said in a statement that the university had not made any misrepresentations and that the settlement contained no admission of wrongdoing. He said the findings “are not an allegation that the university provided false information as part of our marketing and recruitment data,” but rather “an assertion that our material lacks sufficient context and explanation.” This is an example of “containing content deemed by the Department of Energy.”
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“Baker University is committed to continuous improvement and to meeting and exceeding DOE’s expectations, and we are already taking steps to align with that promise,” Professor Spicer said in a statement.
Dan Nowachik, a 2016 graduate of Baker University’s now-closed Flint campus, welcomed news of the penalty and settlement.
“I hope this helps the government take a step back, analyze what went wrong, and fix it,” Novaczyk said in a text message. “They are being fined for this, but I wish something more was being done to protect those exploited by this false advertising. I think it’s a good step to show we’re taking it seriously.”
Novaczyk was among former students who previously spoke to reporters about their troubling experiences at Baker, some of whom said they had no idea they would have to repay their loans.
Another former student said he wished the department had gone further.
“My first thought was that I was honestly shocked that they were allowed to remain open and certified. If they could lie like this before, they I would definitely do it again,” Bart Bechtel said in a text message.
Bechtel, a graduate of Baker College, said he took out more than $40,000 in student loans to earn his associate’s degree online. “The next thing I thought was, that sucks. I still owe $5,000 on my $16,000 loan because of those liars.”
Kevin, an alumnus of Baker’s Flint campus, asked that his last name not be used, which he agreed to. “This is like a slap on the wrist,” he said.
“As far as I can see, there is no compensation for the students,” he added. “They should lose their accreditation. But that is not the responsibility of the Ministry of Education, Culture, Sports, Science and Technology. It is up to the Higher Education Commission, but it is very likely that it will happen in the future.”
HLC is a private accreditation agency that monitors Baker. No comments were received.
An initial study by the media organization found that less than half of former Baker College students earned more than $28,000 a year 10 years after enrolling, according to federal data; It was found to be the lowest standard among universities of its kind.
The settlement comes during the waning days of the Biden administration, which had promised to crack down on deceptive advertising by universities, especially about achievements. Many experts say they fear these types of investigations will disappear under the incoming Trump administration.
A study conducted by the department’s Office of Federal Student Aid found that:
Baker publishes misleading career performance rates on its website, falsely claiming that performance statistics include all graduates when they do not. It was making an impression. In an email, Baker University touted an overall career outcome rate of 91% and an automotive program rate of nearly 96%, but how did the university arrive at that calculation? He did not specify what that meant. Baker posted on its website a list of employers that claim to have hired graduates of the university. However, 14 of the more than 100 employers on the list hired these individuals prior to joining Baker. Baker misrepresented the earnings of its graduates by using national statistics from the U.S. Department of Labor, rather than its own graduate data. Baker published inaccurate data about student employment outcomes in its culinary programs.
“This settlement demonstrates the department’s continued commitment to enforcing higher education laws and regulations and protecting students and taxpayers,” the department said in a statement.
In a 2023 message to the campus community in response to media coverage, Professor Baker said, “Many universities within Michigan and out of state engage in marketing activities. Baker University is not unique. .”
Baker was founded as a for-profit business college in Flint and became a nonprofit in 1977. It grew rapidly by being an early adopter of online learning and opening multiple campuses. It was once the largest private nonprofit university in Michigan.
Growth has resulted in a healthy balance sheet. At the end of the 2013-14 school year, Mr. Baker had revenues of $219 million and expenses of $226 million. However, by the end of 2022-23, revenue was $58 million and expenses were $93 million. In 2011-2012, enrollment peaked at around 45,000 students, but enrollment is now around 4,000.
But Baker still has about $362 million in endowments, according to its 2023 tax return. With that in mind, former administrator and teacher Cleemon Moorer Jr. questioned the impact of the fine. “$2.5 million out of a $300 million endowment — I don’t know how punitive that is for an organization of this size,” he said.
Baker is in the midst of a fundamental shift in its target market, closing campuses in historically industrial areas like Flint and Allen Park and building a new campus in the more affluent suburb of Royal Oak. There is.
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However, many students claimed Baker’s growth was due to deceptive practices and filed complaints with several agencies, including the Department of Education. ProPublica and the Chronicle previously reported that the Federal Trade Commission received about 60 complaints from 2016 to mid-2023. Department of Education records show that between January 2021 and June 2023, 500 tenant defense applications alleging fraudulent conduct were filed against Baker, the most for a nonprofit school. This is an unusually large number.
Among the complaints collected by the FTC in 2022 is a complaint from a student who wrote, “Baker College is supposed to be a nonprofit institution, but it makes false claims about graduate employability, finances, and programs.” There was also.
Another wrote: “I thought I was going to attend a university that valued its students, but I learned that they valued my financial assets to the university, not my education. I was deceived and their I feel like I was used for financial gain.”
