For-Profit College Corp Fined $95.5M

Illegally paying employees based on the number of students they recruited will cost Education Management Corp., the second-largest for-profit college chain, $95.5 million in fines. The Justice Department says Education Management violated a federal ban on incentive compensation at schools that participate in federal financial aid programs. The education firm paid recruiters based on students enrolled, and provided them with Pittsburgh Pirates tickets, free lunches, and expenses-paid trips to Las Vegas and Puerto Vallarta. DOJ’s case against Education Management is one of many government actions against for-profit firms: the SEC is suing ITT Tech for fraud, and the University of Phoenix has been suspended from receiving military tuition assistance.