The Fortis College lawsuit most people are asking about is the 2015 federal case that ended when parent company Education Affiliates, Inc. agreed to pay $13 million to resolve False Claims Act allegations that its campuses had defrauded the federal student aid system. The settlement covered five separate whistleblower suits and reached conduct at Fortis and sister-brand campuses in Miami, Birmingham, Houston, Cincinnati, and Baltimore.1U.S. Department of Justice. For-Profit Education Company to Pay $13 Million to Resolve Several Cases Alleging Submission of False Claims
What the Government Said Fortis Did
The Department of Justice alleged that employees across multiple Education Affiliates campuses ran a set of schemes designed to enroll students who did not qualify for federal aid, then collect that aid on their behalf.1U.S. Department of Justice. For-Profit Education Company to Pay $13 Million to Resolve Several Cases Alleging Submission of False Claims
The alleged conduct included:
- Altering admissions test scores at the All State Career campus in Baltimore so unqualified applicants would appear to meet enrollment requirements.
- Creating fraudulent high school diplomas and steering prospective students to online diploma mills that sold invalid credentials.
- Helping students submit inaccurate information on federal financial aid paperwork.
- Misrepresenting graduate job placement and graduation rates at campuses in Birmingham, Alabama; Houston, Texas; and Cincinnati, Ohio.
- Paying admissions staff bonuses tied to how many students they recruited, in violation of federal rules against incentive compensation for enrollment personnel.
- Doctoring attendance records to make it look like students were meeting participation requirements.
The Miami Diploma Mill Allegation
The Fortis College campus in Miami was accused of awarding federal student aid to students whose only qualifying credential was an invalid high school diploma bought from a diploma mill. Kathleen Tighe, the Department of Education’s Inspector General, called those diplomas a “worthless piece of paper” and described the scheme as “an insidious abuse of the federal student aid system.”2U.S. Department of Justice. For-Profit Education Company to Pay $13 Million to Resolve Several Cases Alleging Submission of False Claims $1.9 million of the settlement was tied specifically to conduct at the Miami campus.1U.S. Department of Justice. For-Profit Education Company to Pay $13 Million to Resolve Several Cases Alleging Submission of False Claims
Criminal Convictions in Baltimore
The fraud at All State Career in Baltimore produced criminal charges alongside the civil settlement. Two admissions representatives, Barry Sugarman and Jesse Moore, and a test proctor, Jacqueline Caldwell, were convicted of federal crimes related to admissions and diploma fraud at that location.3U.S. Department of Justice. For-Profit Education Company to Pay $13 Million to Resolve Cases Alleging Submission of False Claims Those were the only individual criminal prosecutions disclosed in connection with the broader settlement.
Did Fortis Admit Wrongdoing?
No. Education Affiliates resolved allegations only and did not admit liability as part of the $13 million payment.1U.S. Department of Justice. For-Profit Education Company to Pay $13 Million to Resolve Several Cases Alleging Submission of False Claims The cases were brought under the False Claims Act’s qui tam provisions by five insiders, who collectively received about $1.8 million from the settlement.3U.S. Department of Justice. For-Profit Education Company to Pay $13 Million to Resolve Cases Alleging Submission of False Claims
What Has Happened Since the Settlement
The 2015 payment did not end federal scrutiny. According to the National Student Legal Defense Network, multiple Fortis campuses were placed on heightened cash monitoring by the Department of Education and held that status for at least six years. Education Affiliates posted roughly $46 million in letters of credit as financial surety for Fortis, plus another $7.7 million for other campuses in the chain.4National Student Legal Defense Network. The Missing Billion
As of February 2021, none of that surety had been drawn down against Fortis’s outstanding debts with the Department, which totaled over $2.3 million across seven unpaid accounts. The company also failed to meet the Department’s financial responsibility composite score requirements in every year from 2008–09 through 2018–19. The Department nonetheless approved new Program Participation Agreements for several Fortis campuses in March 2021, letting them continue receiving federal student aid.4National Student Legal Defense Network. The Missing Billion Fortis continues to operate, with 28 campuses open across 14 states as of 2026.5Fortis Colleges and Institutes. Fortis Colleges and Institutes
What Fortis Students Can Do
Fortis College and Fortis Institute were both named in a December 2024 letter from members of the U.S. Senate and House of Representatives urging the Department of Education to issue group borrower defense discharges for students at schools with documented histories of predatory practices. The letter noted that roughly 400,000 borrowers had pending borrower defense applications waiting to be processed.6U.S. Senate. Department of Education Borrower Defense Discharges
No group discharge has been announced for Fortis or Education Affiliates borrowers. The Department has approved group discharges for students at other for-profit chains facing similar allegations, including over $6.1 billion for Art Institutes borrowers and $4.5 billion for Ashford University borrowers.7U.S. Department of Education. Borrower Defense Loan Discharge Update Individual Fortis borrowers can still file their own borrower defense applications through the Department of Education’s online portal, and the 2015 settlement findings are the type of evidence those applications rely on.