Accrediting Agency Lifts ‘Show-Cause’ on All Career Education Corp (Nasdaq: CECO) Schools

Orlando, FL 5/7/12 (StreetBeat) -- Career Education Corporation (“CEC”) (NASDAQ:CECO) today announced that the Accrediting Council for Independent Colleges and Schools (“ACICS”) removed its show-cause directive on all 71 CEC campuses accredited by ACICS. The directive related to the determination of past job placement rates at the institutions. As a result of this ACICS review, four CEC campuses were placed on probation.

“We appreciate the thorough review conducted by ACICS,” CEC President, Chairman and CEO Steven H. Lesnik said. “We are certainly pleased that the show-cause directive was entirely lifted. At the same time, the actions show while we have made great strides, there is more work to be done. We have a laser-like focus on activities and services designed to produce outcomes consistent with the high standards we share with ACICS. Importantly, this decision releases us to pursue ACICS approval for modifications to our schools’ academic programs and curricula to ensure that our graduates are prepared to meet the rapidly changing demands of today’s and tomorrow’s workplace.”

ACICS vacated the show-cause directive in action taken at its April 20, 2012 meeting. The directive related to the adequacy of the administrative practices around internal determination of placement rates. With concerns about CEC’s processes addressed, ACICS revisited the number of past placements achieved by each of CEC’s ACICS-accredited institutions. As a result, three healthcare schools – Sanford-Brown Colleges in Indianapolis and Milwaukee, and Sanford-Brown Institute in Landover (Md.) – and the online campus of the International Academy of Design and Technology were placed on probation status due to reporting placement rates at or below 40% for the period from July 1, 2010, through June 30, 2011. Twenty-four schools were subjected to additional oversight, as well.

Campuses on probation remain fully accredited. An institution must demonstrate to ACICS that the conditions that led to the probation have been corrected before probation will be lifted, in this case meaning an increase in placement rates to a level acceptable to ACICS.

CEC has already taken a number of steps to improve student job placement results as well as the reporting of those results, including:
• Adding considerable Career Services personnel;
• Providing Career Services staff with new software to track job applications and interviews for students and graduates;
• Reaching new agreements with career search providers, empowering Career Services staff and students with improved online resources; and
• Engaging in enhanced dialog with businesses to develop relationships and determine what job openings they may have for our graduates.

CEC remains committed to providing high quality education to its students, as well as robust career services support to assist graduates in finding employment in today’s job market.

For additional information about the results of the ACICS review, please see CEC’s Current Report on Form 8-K filed today with the Securities and Exchange Commission.

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