Arthur Keiser – Did He Really Commit Fraud? The Truth Exposed (Update 2024)

Arthur Keiser is a University Chancellor, who describes himself as a person who is responsible for leading and managing all activities at the university’s 21 campuses in Florida, three overseas campuses—two in China and one in Nicaragua—as well as the graduate and online programs. The largest independent university in Florida has grown under Dr. Arthur Keiser’s direction for more than four decades. Keiser University is a private, not-for-profit institution that has received regional accreditation from the Southern Association of Colleges and Schools Commission on Colleges (SACS) at Level VI.

At the Union Institute and University Graduate School, Arthur Keiser completed his doctoral work in higher education administration while working on his dissertation.

Arthur Keiser claims that he has provided a variety of services to the higher education sector at the federal and state levels. He is the Chairman of the National Advisory Committee on Institutional Quality and Integrity (NACIQI), now serving his third term.

Arthur Keiser, the college president, settled a lawsuit with a mother who had accused him of fraud and theft.

In a lawsuit she filed against him, his 98-year-old mother Evelyn Keiser accused him of fraud and theft, claiming that he had cheated her out of income from businesses they had jointly owned. Arthur Keiser, the politically influential owner of several chains of career colleges in Florida and the Southeast, settled the case.

Arthur Keiser agreed to a financial deal to end the case, according to a source engaged in the litigation, which was launched in April 2020; the source, who wished to remain anonymous, would not disclose the settlement amount.

Today in the afternoon, Jeff LaLiberte, associate vice chancellor for media and public relations at Keiser University, sent me an email stating, “The lawsuit was a Keiser family matter that had nothing to do with Keiser University and was amicably settled by the family.”

On March 8, the settlement notice was submitted to the Broward County Circuit Court in Florida.

Arthur Keiser and his wife Belinda, who is also a defendant in the case, have a combined net worth of several hundred million dollars. Together, the Keisers operate the for-profit Southeastern College. Arthur Keiser is “Chancellor and CEO” of the non-profit Keiser University, and Belinda Keiser is Vice-Chancellor.

Last May, a Broward County court rejected a second petition Arthur Keiser had submitted to have Evelyn Keiser declared incompetent and given guardianship after his mother had sued him.

In 1977, Evelyn Keiser and Arthur Keiser, both 23 at the time, launched their professional school company. According to industry experts, Evelyn Keiser built the school with unusual effort thanks to her commitment to helping the citizens of her Florida neighborhood.

However, Arthur Keiser was responsible for the organization’s quick expansion, which resulted in the addition of the for-profit Southeastern College as well as the non-profits Keiser University and Everglades University. The schools have more than 25 sites spread out across Florida, as well as in North and South Carolina, with more than 20,000 students overall.

In addition to the controversy surrounding Keiser University’s 2011 conversion to non-profit status in a deal that has continued to provide millions of dollars in annual income to Arthur Keiser and family members, the schools have attracted the attention of law enforcement agencies and settlements for deceptive recruiting and other predatory practices. 

According to a former Keiser employee and another person familiar with the transaction, Keiser acquired his mother’s almost 50% ownership interest in Keiser University in the early 2003s for somewhere in the range of $7 to $8 million. However, the value of Keiser University was $521 million when Arthur Keiser sold the institution to a nonprofit organization he owned in 2011. 

The chairs of the House Veterans Affairs, House Education and Labor, and Senate Judiciary committees, among other top lawmakers in the U.S. Congress, have recently urged the U.S. Department of Education to look into Keiser University, particularly its alarming conversion to a non-profit institution.

There was a rumor that Keiser University may have likewise closed a chapter in its history with the resolution of the litigation.  Press releases from the school have long stated that the institution was “Co-founded in 1977 by Chancellor Arthur Keiser, Ph.D., and Evelyn Keiser,” but as of this afternoon, the most recent release, dated April 5, posted online, stated that the institution was “Founded in 1977 by Chancellor Arthur Keiser, Ph.D., and the Keiser Family.” 

The Keiser spokeswoman, LaLiberte, responded to my inquiry I made regarding this afternoon’s apparent modification of the school’s history by writing, “Regarding the press release, we previously noticed the error and had it corrected.” In fact, it appears that Evelyn Keiser was mentioned in the web publication within the last 90 minutes. 

Robert Keiser, the son of the Keisers, recently earned his doctorate from a for-profit online university. He is now vice-chancellor of the graduate school at Keiser University and, as of March, the ecstatic new proprietor of a Primrose Schools franchise. 

At Keiser University, violent crimes persist

In order to stop the federal government from enforcing a settlement agreement that cancels the federal loans of former students of Arthur Keiser’s schools who claim they were defrauded, the Florida college operator has been aggressively litigating in federal courts, including right now at the U.S. Supreme Court. Arthur Keiser has received hundreds of millions of dollars in income from your tax dollars.

Because, according to Keiser, “there’s no evidence of misconduct” at his schools, he publicly maintains that the proposed student debt relief for his own former students, as well as students at 149 other institutions with dubious reputations, is unfair.

However, subsequent staff stories suggest that predatory behavior at Keiser’s schools is still occurring today.

A total of 20,000 students are enrolled in Keiser’s schools, which have campuses throughout the state of Florida, in North Carolina and South Carolina, in China and Nicaragua, as well as online. These schools offer a variety of programs in fields like business, criminal justice, and culinary arts.

In response to Keiser’s claim that his schools are completely innocent, we recently reminded our readers that his flagship Keiser University has settled cases with Florida’s attorney general and the U.S. Justice Department over alleged illegal student recruiting practices and that the Internal Revenue Service imposed penalties after it found that Arthur Keiser improperly charged rents above fair market value for properties he leased to Keiser University, the non-presidential branch of the university.

We released a thorough investigative report in 2020 that detailed many alarming problems at Keiser’s schools. We wrote about the troubling overlap of personnel and resources between non-profit Keiser University and Southeastern College, a smaller for-profit school owned by Arthur Keiser and his wife Belinda, based on accounts from more than fifteen current and former Keiser officials and employees as well as current and former Keiser students. We also wrote about shady business dealings between Keiser University and the Keisers and other board members.

Senior Democrats in Congress last year urged the U.S. Department of Education to look into Keiser’s schools, including senators Dick Durbin (D-IL) and Elizabeth Warren (D-MA), as well as the heads of the House Veterans Affairs and House Education and Labor committees at the time.

Additionally, the Department found that SACS, Keiser University’s accreditor, was in violation of multiple federal rules in November of last year and ordered it to disclose more details regarding its management of Keiser University and the institution’s transition to non-profit status.

Keiser was not pleased about that because his consistent political contributions and expenditures on Washington lobbyists helped win the loyalty of certain important Washington lawmakers, including current House Education and the Workforce chair Virginia Foxx (R-NC).

Keiser is also obviously upset that some of his former students might have some of their obligations forgiven. However, there is now even more information to disclose regarding abuses at Arthur Keiser’s schools, based on the testimonies of multiple former workers, the majority of whom had recently worked there. All of these individuals ultimately chose not to be identified in this article due to worries for their careers:

(1) Keiser University engages in aggressive, predatory recruitment, including the recruitment of low-income individuals for the school’s online division who appear unprepared for college programs and the recruitment of individuals to campus-based health care programs who lack sufficient English language proficiency to comprehend the course work; and

(2) encouraging St. Andrews University students in North Carolina to enroll in some of their courses online at Keiser University, where Arthur Keiser gained influence.

Predatory hiring at campuses and in the online branch of Keiser University

After working for a little over a year as an admissions representative for the university’s undergraduate online division, a former Keiser employee got in touch with me late last year. He emailed me, “The school is totally corrupt and preys on students.” The high-pressure sales tactics and boiler room operations of infamous online for-profit colleges like ITT Tech and American Intercontinental University sounded a lot like what he described when we first spoke on the phone.

The former representative claims that personnel in the admissions office would phone potential students to try and enroll them after obtaining their names and contact information, frequently via third-party lead generation companies. Frequently, the individual answering the phone would ask, “Why are you calling me? 

Already, 20 schools have called me. Some claimed they had already requested not to receive further calls.

The ex-rep claims that although managers told them that the customers they were phoning had contacted Keiser University for information, “it’s people who accidentally clicked on a button.” Prospects have acknowledged responding to Keiser commercials that have been running nonstop on Facebook, YouTube, and TikTok.

The former representative noticed right away that his job was more telemarketing than education. “The calls are crap, and the leads are crap,” he complains.

The Keiser University online students were dispersed across the nation rather than centered in Florida, where the institution’s physical campuses are located. According to the former representative, at least 70% of the students he enrolled were Black. Many of these women had three or four children on their own. Some of them were senior citizens in their 70s and 80s.

The representative responds, “I would google some of the cities” where the prospects lived. “Towns with 1000 residents. We target those with fewer resources and overcharge for education.

He claims that medical billing and coding, medical assistance, and psychology were the three subjects that Keiser internet representatives most frequently promoted.

Even if a prospect did not appear to be a suitable fit for a program, the rep was instructed by a supervisor to inform them that they are. Additionally, the representative claims that the supervisor “told me to tell recruits things that weren’t true, such you need a criminal justice degree to get a job with TSA or Border Patrol. Not the case.

The “Legal Studies” program at Keiser University offers a bachelor’s degree, however, it is not a degree in law that qualifies graduates to sit for the bar exam and practice law.  Keiser University’s website states that the program “trains students for careers in law and law-related fields (business, government, and criminal justice) and also prepares students to pursue a law degree.”

Keiser representatives would respond that the program is accredited by NALA and “it’s the same thing” if students inquired about the program’s accreditation by the American Bar Association, which accredits real law schools. NALA, however, grants paralegal certification; it does not accredit law schools.

The former representative generally asserts, “We are not outright lying to people.” However, the recruiters for Keiser told students “vague things – redirecting them.”

Reps promised prospective students free Microsoft Office software if they signed up, but they failed to mention that Microsoft offers the program freely to virtually every college student.

When someone enquired “If it’s a scam school, we said no,” the representative replies. The high turnover on the admissions team and the fact that, according to the ex-rep, employee training was more on learning recruiting scripts, dialing, and noting prospect responses than on the specifics of Keiser University academics may explain why many reps lacked in-depth knowledge of Keiser programs.

In order to take the school admission exam and pay the $60 application fee, the representatives wanted students to sign up.

Afterward, ensuring that each and every registered student arrived for class. In order to accomplish this, they assigned the just-enrolled students small tasks to keep them interested, such as checking in with the financial aid office about their loans and visiting the online school bookstore.

Because, according to him, “if they have time to think about it they might not move forward.” The students were obligated to pay for four months as long as they were linked to Keiser’s Blackboard app. His boss never let up in pressuring him to get the pupils to log in.

The sales representatives came to assume that in order for lessons at Keiser Online to begin each month, they needed to get four or five such “starts” (new enrollments) each month. The former representative claims that if you missed that goal, you would “be afraid you would be fired.”

The ex-rep claims that if you received an enrollment, “that felt good because they left you alone” for a time.

A “leader board” that listed team members according to the number of enrollments they had attained was routinely distributed to members of the admissions team through group email; I reviewed one of them. There are no shortcuts in admissions, the management warned reps in the memo. To communicate with our pupils, we must call, text, or send emails. 

St. Andrews students are directed to Keiser University classes

We revealed in February 2021 that Laurinburg, North Carolina-based, non-profit liberal arts university St. Andrews University had come under the control of Arthur Keiser. Webber International University, the parent institution of St. Andrews, received contributions of millions from Keiser University.

A majority of those who replaced the Webber board of trustees were associated with Arthur Keiser. While still working for Keiser University, Ellen Bernhardt, a senior official, was appointed as the interim president of St. Andrews. Additionally, St. Andrews established branch campuses in North Carolina and South Carolina at the same locations as Southeastern College, a for-profit institution owned by Keiser.

We conjectured, among other things, the advantages that may result from utilizing St. Andrews’ reputation as a conventional non-profit institution to direct students to for-profit Southeastern in our attempt to understand why Arthur Keiser wanted influence at St. Andrews. However, it seems that there was also a scheme to encourage St. Andrews students to enroll in Keiser University’s online program.

Numerous former St. Andrews faculty members claim that Bernhardt told the faculty executive committee in 2020, while she was president, that failing St. Andrews students could enroll in four-week online courses at Keiser University, have their failing grades removed, and be eligible to pass their courses and receive credit. This information is supported by school records. 

The provision was not eagerly adopted by faculty members, and it is unknown how frequently it was used. Bernhardt’s responses to faculty inquiries about the specifics were evasive. Uncertainty exists around whether the St. Andrews agreement with Keiser University complied with regulations set forth by the Department of Education for such circumstances.

It’s also unknown how Keiser and St. Andrews are related right now.  Within days of the arrest of a St. Andrews student and member of the wrestling team for allegedly sexually assaulting three other students, Ellen Bernhardt abruptly resigned from her position as school president and left St. Andrews in January. The arrest followed a 2021 lawsuit filed by a different St. Andrews girl who claimed she was raped by a soccer player on the school’s squad.

When contacted for comment on matters involving both Keiser University and St. Andrews, a spokeswoman for that institution requested written inquiries, which I gave him. He didn’t reply once more.

Keiser’s attempt to prevent past students from receiving debt relief

Arthur Keiser is currently attempting to intervene in a court-approved settlement between the Department of Education and former students of various for-profit and career universities to prevent the Department from terminating debt relief for his former students.

Former students in the case of Sweet v. Cardona said that their universities had misled them and that the Donald Trump-Betsy DeVos Department of Education had illegally denied or disregarded their requests for the cancellation of their federal student loan debts.

The Biden administration secured a settlement agreement that would pay around 264,000 former students with debt relief totaling $6 billion who contend that their colleges misled them.

Through their parent company Everglades College, Keiser’s Keiser University and Everglades University, along with two for-profit college chains, filed a lawsuit opposing the agreement, arguing that doing so would cause them to be listed among the 151 institutions whose disgruntled students would automatically receive loan cancellation.

These are institutions where there are “strong indications regarding substantial misconduct, whether credibly alleged or in some cases proven, and a high rate of class members with applications,” according to the administration, to the Department for loan relief.

The student’s lawsuit, which was filed in accordance with a law that allows student loans to be discharged when borrowers can prove their institutions misled them, is independent of the Biden administration’s larger effort to lower student loan debt, which was contested last month in a case before the U.S. Supreme Court.

Keiser and the other two schools made unsuccessful attempts to persuade the federal district court in San Francisco to throw out the entirety of the Sweet settlement and prevent debt relief for all 151 schools’ students, or at the very least, to prevent the relief for former students of their own institutions. Keiser continued to battle to keep his own former pupils in debt when the court rejected his attempt, filing an appeal.

The U.S. Court of Appeals for the 9th Circuit gave Keiser another setback on March 29 by declining to halt debt relief for the former students of the schools while the appeal is being considered by the court. Keiser is currently requesting an emergency stay of that decision from U.S. Supreme Court Justice Elena Kagan with the support of 20 Republican state attorneys general. Today in federal court, the government and the kids’ attorneys are required to respond to that petition.

Keiser/Everglades is represented in the case by attorney Jesse Panuccio, a former employee of the Trump Justice Department who also defended Betsy DeVos in her protracted and finally successful attempt to avoid giving a deposition by the attorneys representing the students.

In NACIQI, the Department of Education’s advisory committee on accreditation, Arthur Keiser served as chairman until recently and is still a member. There, he has frequently criticized the Department for tightening its scrutiny of accreditors, including the organizations that accredit his own schools.

As the information updated on 4/12/2023

The Biden administration and attorneys for the Sweet case’s pupils have both submitted briefs to the Supreme Court today opposing Keiser’s request for a stay of proceedings.

Keiser’s appeal to the high court was referred to in a statement by Eileen Connor, head of the Project on Predatory Student Lending, as “a desperate attempt to bypass the normal appellate process” and an effort “to distort reality.”

As the information updated on 4/13/2023

The plea by Keiser and the other two colleges asking for a stay of the settlement was rejected by the U.S. Supreme Court.

Types of Fraud in the Educational Sector

Malware Attack

Malware attacks, in which an unauthorized malicious application is downloaded and installed on the user’s device, are one of the most prevalent types of fraud in education. According to Microsoft Security Intelligence, malware assaults made up 64% of all cybercrimes in the education sector. Due to the student’s utilization of the online learning approach, such events have increased in frequency. Students frequently log into systems using personal devices and unsecured networks, which exposes them to cyberattacks from criminals who may steal children’s identities or create fake IDs.

Attacks through Social Engineering

Another prominent form of fraud in the education sector that uses psychological manipulation is social engineering attacks. It’s typically a phishing email in which the recipients are asked to divulge their private data in exchange for assistance. For instance, some people were asked to give their personal information via emails during the epidemic, using COVID guidelines as the justification.

Theft of student loans

Student loan fraud is committed by students. They use someone else’s ID and make fraudulent claims about their financial situation in order to access monies. Feds in California recently reported that 65,000 fictitious students had submitted financial aid applications to a number of community colleges.

Fake scholarships

Students occasionally fabricate their identities while applying for scholarships to receive a sizable reduction on their tuition, similar to student loan fraud. However, this scam also targets students as victims. As an illustration, con artists approach students by email, text message, etc. with offers of scholarships and then link them to dubious websites where they steal credit card information.

Identity Thefts 

Fraudsters steal the students’ personal information, combine it with fake data, and generate new IDs to avail of financial benefits. Also, students primarily use social security numbers (SSNs) as an ID at institutes, much sought-after information criminals use for committing crimes.

Wapping up with some of the points Universities can follow to avoid Educational Scams

• To safeguard student portals, internet databases, and academic information, institutions must adopt automated security solutions.
• To stop fraudulent enrollments and guarantee that only real students have access to the system, they should also invest in AI-Powered ID verification systems like HyperVerge.
• Institutions need to teach their academics fundamental behaviors like not clicking on any dubious links that might be phishing.
• Before giving loans to students, authorities must utilize document authentication methods to confirm their identity.
• To increase security, biometric authentication methods like facial verification should take the place of traditional passwords.

Arthur Keiser – Did He Really Commit Fraud? The Truth Exposed (Update 2024)

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