There is no landmark class action against Centura College, but a search for a Centura College lawsuit turns up a mix of student complaints, a dropped ownership dispute involving founder Gerald Yagen, high federal student loan default rates, and provisional oversight by the U.S. Department of Education. If you are considering enrolling, already attending, or trying to figure out what to do with credits from a Centura campus, the picture below is what the public record actually shows.
What Students Complain About
Complaints against Centura College cluster in a few consistent areas. They have not produced a headline class action, but they are the substance behind most searches for legal action.
Credits That Don’t Transfer
Former students report that credits earned at Centura were not accepted by community colleges or four-year public universities, forcing them to start over. Several said admissions staff assured them during enrollment that credits would transfer, and that turned out to be untrue.1GradReports. Centura College Reviews A Virginia Beach campus student described still trying to transfer credits years after leaving.2Niche. Centura College Virginia Beach Reviews
Instruction and Equipment
Reviews describe instructors who lacked expertise, were often absent, or behaved unprofessionally. Students called course material outdated and said clinical labs lacked the equipment needed for real hands-on training.1GradReports. Centura College Reviews At the Virginia Beach campus, students said they were “mistreated” for disagreeing with faculty, and one reported that an entire class was threatened with grade retaliation for refusing to perform a medical procedure under conditions students considered inappropriate.2Niche. Centura College Virginia Beach Reviews
Job Placement and Financial Aid
Many graduates say the school promised employment help or internships that never materialized. A 2018 graduate reported still being unemployed in the field three years later, while dealing with debt and wage garnishment. “These private schools will tell you anything to get money from you,” that reviewer wrote.2Niche. Centura College Virginia Beach Reviews Students also described unexpected balances for equipment like laptops and textbooks that they said were never disclosed upfront, and characterized the school as focused on collecting tuition rather than supporting students after enrollment.1GradReports. Centura College Reviews
The Spartan College Lawsuit
The most concrete piece of litigation tied to Centura College’s ownership was filed in 2013 by Spartan SP Investor, LLC, an Oklahoma-based school operator. Spartan sued Gerald Yagen, his wife Ruth, and their corporate entities in the U.S. District Court for the Northern District of Illinois, alleging unjust enrichment, breach of contract, promissory estoppel, and fraud. The dispute involved a July 2013 term sheet under which Spartan would have purchased sixteen of the Yagens’ vocational schools, including eight Centura-branded campuses. Spartan claimed that after it helped stabilize the financially distressed schools, the Yagens backed out and refused to negotiate a final purchase agreement in good faith. Spartan sought more than $20 million.3GovInfo. Spartan SP Investor LLC v. W. Gerald Yagen et al., No. 13 C 68824The Virginian-Pilot. School Drops Lawsuit Against Pungo Businessman
In April 2014, a federal judge transferred the case to the Eastern District of Virginia, finding Virginia was where the material events occurred.3GovInfo. Spartan SP Investor LLC v. W. Gerald Yagen et al., No. 13 C 6882 Spartan dropped the lawsuit in June 2014. Yagen told reporters the dismissal was not a settlement and that he did not pay Spartan’s legal fees, saying the plaintiffs realized “they’re not going to win the case.” Spartan’s attorney said the company reserved the right to refile.4The Virginian-Pilot. School Drops Lawsuit Against Pungo Businessman The case did not involve student claims and did not resolve any question of educational quality.
Federal Default Rates and Department of Education Scrutiny
The Department of Education tracks cohort default rates, which measure the share of borrowers who default on federal student loans within a few years of entering repayment. Schools above 30% for three consecutive years risk losing federal financial aid eligibility, which is the main revenue source for most for-profit institutions.
Data released in September 2014 showed Centura hovering at or near that threshold. One Centura campus reported default rates of 35.0% in fiscal year 2009, 32.0% in 2010, and 23.7% in 2011. A second campus reported 34.7%, 31.5%, and 24.8% for the same years. Tidewater Tech, part of the same school group, ran higher: 55.0% in 2009, 42.7% in 2010, and 38.6% in 2011.5Robert Kelchen. Analyzing the New Cohort Default Rate Data Twenty-one colleges nationally faced sanctions under that year’s data, though the Department also adjusted its calculation methodology in ways that helped some borderline schools.
Provisional Federal Funding and Possible Closures
Centura College has operated under a Temporary Provisional Program Participation Agreement with the U.S. Department of Education, a designation triggered by a change in ownership. Provisional status imposes heightened oversight: audited financial reporting, growth restrictions, and biweekly and monthly financial disclosures. The agreement was set to expire June 30, 2024, with a reapplication deadline of March 31, 2024, and it stated that if required documentation, including proof of accreditation and state authorization, was not submitted by expiration, federal funding would be cut off without further notice.6StudentAid.gov. Centura College Program Participation Agreement
The same agreement required Centura to submit updated teach-out plans if the Department moved to limit or terminate Title IV participation, if the accreditor withdrew or suspended accreditation, if a state revoked the school’s license, or if the school intended to close a location or cease operations. Some student reviewers have referenced campus closures at Centura locations.6StudentAid.gov. Centura College Program Participation Agreement
What to Verify Before You Sign or Borrow
Before enrolling at any remaining Centura campus, or before taking on additional loans if you already attend, confirm the school’s current accreditation and Title IV eligibility directly with the U.S. Department of Education. Ask in writing whether specific credits will transfer to the community college or four-year school you plan to attend next, and get the answer from the receiving institution, not from Centura’s admissions staff. Ask for an itemized cost sheet that includes equipment and books before signing any financial aid paperwork. And if you are relying on GI Bill benefits, verify with the VA what portion of tuition and fees the benefit actually covers at the specific program you are considering.