A for-profit college in Kentucky has agreed to pay more than $1 million in a settlement with former students. Multiple lawsuits accused Owensboro-based Daymar College of enrolling students through bogus claims about job placement and transfer credits.
Kentucky Attorney General Jack Conway sued Daymar College, alleging the school violated consumer protection laws. Former students claimed in lawsuits that they were deceived about the quality of Daymar’s degree programs and were left deep in debt with few career opportunities.
The total settlement is for $12.4 million, and requires Daymar to pay $1.2 million to qualified students who attended the school between 2006 and 2011.
At a news conference Thursday, Conway acknowledged the amount is only a small portion of the tens of thousands of dollars in loan debt incurred by students.
"We wanted to get as much as we could for the students in this affected period," said Conway. "It's not all that we wanted. I'll readily acknowledge that, but based on Daymar's financial situation, we really thought that it was the best we could get."
Under the deal, Daymar denies any wrongdoing, but Conway said the settlement speaks for itself.
"I've practiced law and been attorney general for seven and a half years," he added. "You don't agree to a settlement worth 12 and a half million dollars, as well as strong injunctive terms for two years with a compliance monitor if you didn't do anything wrong."
Daymar will also forgo collection of $11 million in debt owed it by former students. The school had no immediate comment.
For-profit colleges are under scrutiny across the nation for low graduation rates and enrolling students who are unable to pay their bills.
