Unregulated schools leave students in lurch

States should take action when technical schools close, advocates say.
BOSTON (AP) -- Hundreds of computer training schools that sprouted during the dot-com boom have now shut down, leaving frustrated students with big debts and little education.
State regulatory oversight of the business is far too lax, and loans to attend such schools have been too easy to obtain -- a recipe for disaster, consumer advocates say.
"Did I get my money's worth? Absolutely not," said Christian Rinaldi, 33, of Lowell, Mass.
Three years after obtaining a $6,000 loan to attend the Greater Lowell Computer Center for certification as a Web designer, Rinaldi is working as a courier and paying $150 a month for his student loan.
The school closed without notice in November after losing a lawsuit brought by a disgruntled student. Rinaldi said he never got close to completing his courses.
"They went through teachers like water," he said. "We always got apologies. They'd say 'We're working on it.'"
Like Massachusetts -- whose attorney general received 73 complaints last year about computer training schools, up from just eight complaints the prior year -- other states are also reporting trouble.
About a fifth of Michigan's 100 computer schools closed in 2002, as did 10 of the 59 schools in Texas, according to the National Association of State Administrators and Supervisors of Private Schools, which surveyed members last year. Four of seven schools in Wisconsin closed.
Another concern
Only a quarter of the schools in 22 states surveyed gave notice before closing. Among the reasons cited were a poor economy, low enrollments, bankruptcy and state violations.
"These places are businesses not sanctioned by education groups," said David L. Johns, president of the National Private Schools Association Group Resource Center, a Florida-based group that accredits schools.
"These [businesses] go in without properly being prepared, even though their intentions might be good."
Mary Jayne Fay, who heads trade school licensing at the Massachusetts Department of Education, said she has had difficulty contacting directors of failed Massachusetts schools -- seven closed last year and one in January -- and repeated attempts by The Associated Press to reach the officials were unsuccessful.
Accurate figures on the total number of computer training schools -- and how many close -- are difficult to obtain because so many are unlicensed. The U.S. Department of Education keeps statistics only on licensed schools.
Kenneth W. Chandler, a former education official in North Carolina, estimated last year that as many as 300 career training schools were unlicensed in that state.
Consumer advocates say states need to get more aggressive in protecting the investments of employment-starved tech trainees, who tend to be unable to afford lawyers.
No suits
"There hasn't been an attorney general lawsuit in any state. They need to start bringing the cases," said Deanna Loonin, a staff attorney at the National Consumer Law Center, a Boston-based nonprofit that works on behalf of low-income people.
Loonin and others say it should not be so easy for such trade schools to obtain loans for students. The loans, mainly obtained through Sallie Mae Financial and Key Bank, are not federally backed. And that makes it far more difficult for students to get them forgiven when a school suddenly closes.
Schools are required to give refunds if they cancel classes or close midcourse. Massachusetts law requires schools to refund loan companies for any unearned portion of the loan, but only one of the seven schools that closed last year did that, Fay said.