Florida Attorney General Investigating 5 For-Profit Schools

The Florida Attorney General's office has launched an investigation into five for-profit colleges, including four publicly traded schools, seeking information on potential misrepresentations in financial aid, recruitment and other areas.

The state is looking into allegations at Washington Post Co.'s (WPO) Kaplan Inc. -- including its Kaplan University, Kaplan Educational Centers and Kaplan College units -- and at Education Management Corp.'s (EDMC) Argosy University, Apollo Group Inc.'s (APOL) University of Phoenix; Corinthian Corp.'s (COCO) Everest College and privately held MedVance Institute.

According to a statement from the attorney general's office, the probe is seeking information on "alleged misrepresentations regarding financial aid; alleged unfair/deceptive practices regarding recruitment, enrollment, accreditation, placement, graduation rates, etc."

For-profit colleges have been under fire lately for their aggressive recruiting tactics, with government officials calling into question the schools' quality of education and high price tags. The U.S. Senate is conducting a series of hearings on the issue, while the U.S. Department of Education is set to release a series of rules this winter that would penalize schools that graduate students with heavy debt loads and poor job prospects.

Florida received a number of consumer complaints about the schools, according to Ryan Wiggins, deputy communications director for the state's attorney general, and a negative report from the U.S. Government Accountability Office pushed the staff to conduct its own investigation. That GAO report, issued at an August U.S. Senate hearing, found that representatives from all 15 for-profit schools it had visited offered misleading or fraudulent information to undercover agents posing as prospective students.

Wiggins said the attorney general's office is speaking with students, though she couldn't provide further details of the probe. She said she doesn't believe the schools are aware of the investigation at this time.

Representatives from Kaplan Inc. and Apollo had no immediate comment while representatives from Education Management, Corinthian and MedVance weren't immediately available for comment.

More information is expected to be available on the office's website later this evening.

-By Melissa Korn, Dow Jones Newswires; 212-416-2271; melissa.korn@dowjones.com

(Rolfe Winkler contributed to this article.)

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