Computer training company deletes hopes of Md. enrollees

Customers say they lost thousands in SCD crash

May 04, 2002|By Tanika White | Tanika White,SUN STAFF

A financially troubled, North Carolina-based computer training company took thousands of dollars from at least a dozen prospective students in Maryland but never opened the doors of its planned Columbia classroom, angry customers and state officials say.

The Maryland Higher Education Commission has issued a cease-and-desist order against the company - Solid Computer Decisions (SCD) of Charlotte - demanding that it stop marketing its services in Maryland and proposing that the company be fined for its actions in this state. SCD did not obtain required permissions to offer the program in Maryland, officials said.

Students took out loans up to about $10,000 to pay for the training, and some reportedly quit jobs to get on board with SCD.

The company not only promised training in software, operating systems and networking, but also hooked students by assuring them well-paying positions with the company after the pricey coursework was done.

John Sikorski, of Glen Burnie, wanted to change careers and signed on to the promises SCD advertised. When the school hadn't opened its doors by mid-April, he immediately set out to have his $10,945 loan canceled.

SLM Financial Inc. - one of the lenders that provided education loans to prospective SCD students - has offered to provide a "teach-out" to students, essentially a transfer to a comparable training institution of the company's choosing.

Sikorksi said a teach-out is not acceptable.

"I don't want somebody else making that choice for me. After this mistake, I'm going to be very, very careful and very, very thorough as to who provides this training for me," said Sikorski, 48. "The right thing for them to do is refund the money, basically absolve the loan, and we'll just start from scratch."

Details about SCD's status are vague, but a former vice president said financial troubles caused the rapid unraveling of its 34 locations in as many as 10 states.

"It caught us all off guard," said Eddie David, who was SCD's vice president of sales and marketing until a few days ago. "We did not see this happening."

A May 1 letter to students from the company's president, Jerry Wingate, indicated that he was planning to permanently close all of SCD's locations and file for Chapter 7 bankruptcy.

The company had about 270 employees, David said.

State education commission officials are waiting to hear from Wingate, who they said had been unreachable for several days.

The school is being fined $10,000 by the commission and could face thousands more in penalties if it fails to identify its prospective Maryland students and provide them with refunds.

"I don't know that we'll get a response," said Judy Hendrickson, director of academic affairs for the higher education commission.

Responsibility for loans

Meanwhile, students who enrolled for training might be responsible for the loans.

Wingate's letter to students this week said that "realistically, expectations for a refund will be a minimal amount following Chapter 7 [bankruptcy] so we encourage students to take advantage of teach-out programs that become available."

But state education officials have contacted SLM Financial and other lending agencies, making it clear that the students deserve refunds or loan cancellations, not a teach-out.

Hendrickson said SCD should never have kept students' money when it was ordered to cease and desist in March. "But secondly, those student loans should never have been issued by the lenders to an unapproved school," she said.

The trouble with SCD started almost as soon as its representatives applied in December to have its planned Columbia program approved by the Maryland Higher Education Commission, state officials and former employees said.

According to Hendrickson, the application was incomplete and sent back to SCD. In February, the school sent the commission copies of proposed ads it intended to take out in newspapers and on radio to solicit students. Hendrickson said SCD officials were told that they could not advertise or enroll students before approval.

In mid-March, the commission received a complaint from the mother of a student who was concerned because the school - which was scheduled to open March 11 in Columbia - had postponed its opening day by a month and did not provide a firm start date.

"This clearly indicated that, even with full knowledge, they had advertised and gone ahead and were enrolling students," Hendrickson said.

It's unclear how many people enrolled, but a former employee who moved to Columbia from North Carolina to help open the new school estimated that 15 or 16 signed up.

Broken promises

In a letter of complaint to SCD's chief financial officer, an Owings Mills man wrote that he quit a $35,000-a-year job to attend classes and is working as a security guard to pay his bills.

"They advertised themselves as if they were well established and could provide training," Sikorski said. "They promised to hire you and put you on the payroll if you completed the training successfully within a one-year period. I didn't see a problem with that. But they just used that as bait to try to get you to [take] their training, but at a higher price than it would cost at another place."

The company's brochure included a reference to the Maryland Higher Education Commission, giving consumers the impression that it was approved.

"They may have made application, but they were not approved," Hendrickson said. "We believed them when the president of the school sent a letter saying that they had ceased and desisted. We believed that they weren't enrolling students and hadn't started training."

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