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Apollo Group settles suit for $78.5 million

Arizona Republic

December 15, 2009

University of Phoenix parent Apollo Group Inc. will pay $78.5 million to settle a longrunning federal whistleblower lawsuit over recruiter-pay practices.

The lawsuit, filed in U.S. District Court in Sacramento, was filed by two former University of Phoenix enrollment counselors on behalf of the federal government under the False Claims Act. They said the Phoenix-based for-profit school was defrauding the government of billions in financial aid because it paid recruiters based on the number of students they enrolled, a violation of federal law.

This is the second-largest settlement in a False Claims Act case where the government declined to intervene, said Rachel Geman, partner with the law firm Lieff Cabraser Heimann & Bernstein. More...

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