Immigrants Get Taken for Ride With Student Loans

To the newly legalized immigrants, it must have sounded too fantastic to be true.

With their temporary resident cards in hand, about 3 million men and women throughout the United States who qualified for the immigration amnesty program in 1988 were suddenly eligible for $5,000 or more in federally backed student loans.

Attracted by aggressive marketing campaigns, the immigrants began flocking to vocational schools, hoping to learn word processing, computer repair and other skills that would help them escape the near-minimum-wage jobs that had been their lot as undocumented workers.

Only now have many of the student-immigrants concluded that the trade schools have taken them for a ride, cheating them of thousands of dollars each. They tell academic horror stories of classes without books or teachers and of school administrators who taunt them with racial slurs.

As complaints pile up, government regulators, public interest attorneys and immigrants’ rights advocates have reached the same conclusion: Thousands of recently legalized immigrants have become the newest and, in some cases, the preferred targets of trade schools that use them as mere funnels to collect millions of dollars in federal funds.

Although most of California’s 2,500 vocational schools have not generated complaints, the state attorney general’s office is investigating cases involving one-fifth of California’s 500,000 private voca tional and trade school students, according to Deputy Atty. Gen. Ron Reiter. Many of the complaints involve recently legalized natives of Asia and Latin America.

“The schools just look at us and see the pesos on our foreheads,” said Alvaro Lopez, a 26-year-old Mexican immigrant who is one of about 20 students who have contacted public-interest attorneys and asked them to take legal action against Webster Career College, a Long Beach vocational school.

The students say they received little or no instruction at the college. No one will hire them to work in the vocations for which they were ostensibly trained--such as accounting and computer data entry--because they clearly are unqualified. And yet they must repay the loans.

Webster officials deny having misled the immigrants.

“We have a qualified faculty with credentials to back up their training,” said Lourine Hodge, director of operations at the Long Beach campus.

But one student, Carmen Chacon, 33, a packinghouse worker, said school administrators took advantage of her desire to better herself. With her poor command of English, she said, she has no chance of becoming a computer operator--despite the $5,041 she spent for three months of course work at Webster.

“To succeed, that’s what you come to this country for,” she said in Spanish. “You don’t want to end your days in a factory, tired, with some foreman yelling at you. . . . The school made so many promises to us. And of all those promises, not one has come true.”

Eventually, students like Chacon and Perez will receive terse letters from bankers and the federal government demanding payment of the loans. They are made by private banks, which do business with the immigrants and other economically disadvantaged students because the loans are backed by the federal government.

If the students refuse or are unable to pay the loans, the Internal Revenue Service will place liens on their federal income tax refunds. The student immigrants thus face a cruel irony: Now that they have lost their fear of “la migra “ (Spanish slang for the immigration authorities), they must contend with IRS agents.

Emiliano Herrera, an unemployed metal worker, said he incurred a $5,500 debt by enrolling in a course at Beta Technical Schools, also in Long Beach. His three-month class in automobile repair cost more than an academic quarter at Stanford University. And, according to affidavits on file in Los Angeles Superior Court, the school didn’t even have a garage or cars to work on.

“They didn’t have any tools; they didn’t have anything,” Herrera, 37, said in an interview. “If they’re going to charge that kind of money, they should at least have a workshop. . . . When I complained, they told me, ‘Don’t worry, we’ll have it all in a couple of weeks.’ ”

The state attorney general filed suit in March against Beta Technical Schools, alleging that the college misrepresented its auto repair courses. In April, a Los Angeles Superior Court judge issued a temporary restraining order preventing Beta Technical from operating auto repair courses that are not certified by the state. The school, however, is still providing other courses at its Long Beach campus.

Richard Posell, an attorney representing the school, said the state was to blame for some of the problems because, he said, it delayed issuing the school permits that would have allowed the teaching of the auto course. Posell added that former students also bear some of the responsibility.

“A lot of the people who come to trade schools are people who aren’t successful in the normal educational system,” said Posell, who has represented vocational schools in civil suits for more than 15 years. “They really don’t like going to school. That’s what it comes down to.”

In recent years, state and federal regulators have sharply criticized trade and vocational schools for defrauding low-income men and women of millions of dollars in federally backed loans. Four states, including California, have enacted legislation designed to curb the most serious abuses. More than a dozen other states are considering similar laws.

California’s law went into effect Jan. 1. By then, aggressive recruiting campaigns in the Spanish media had already attracted thousands of immigrants. Newly legalized immigrants became eligible for the loans after May, 1988, when they began completing the first stage of the amnesty program.

“The immigrants are a whole area that had been untapped before,” said Elena H. Ackel, an attorney with the Legal Aid Foundation of Los Angeles. “This is a group that was disregarded because they didn’t have access to government loans. The amnesty was like opening up another bucket of money for the schools.”

The loan payments are made directly to the schools. Students who drop out, even after only a few weeks, must still pay the bulk of their loans.

Many student-immigrants are only now receiving their first notices that they are delinquent in repaying loans. As a result, in recent months, many have arrived at legal aid clinics throughout Los Angeles seeking help.

This month, the Los Angeles public interest law group Public Counsel is assisting 240 students who are taking legal action against their school operators, said Kenneth W. Babcock, director of Public Counsel’s poverty law programs.

At one Los Angeles-area trade school, Babcock said, most “instruction” in an English class consisted of viewing rented video movies.

“(The students) kept seeing ‘La Bamba’ over and over again,” Babcock said. “They complained. They thought it was ridiculous they were paying all that money to watch videos.”

Advertising in the Spanish media is not the only draw to the vocational schools. Students said there are “employment offices” that double as school recruiters. This practice is called “blind advertising” and is illegal in California. Still, blind advertising is common in the vocational school industry, according to Deputy Atty. Gen. Margaret Reiter, who has filed fraud suits against several schools.

She said schools will typically pay recruiters about $500 for each prospective student “delivered.”

Olga Betancourt, 51, said she was recruited to a Los Angeles business college by an employment office in the downtown Greyhound bus terminal. A low-paid seamstress for more than 20 years, Betancourt said she had gone to the office in search of a job in housekeeping or any other better-paying field. Instead, a woman at the office persuaded her to try her luck at computer classes.

“She told me, ‘Why do work (as a housekeeper)? Earning $100 per week doesn’t suit you. If I were you, I would go to school. It won’t cost you much money.’ ”

“Training equals jobs,” read the flyer Betancourt was given at the employment agency. With that slogan in mind, Betancourt walked the few blocks from the bus station to the business college on Spring Street, hoping to become a computer operator.

Betancourt is among 40 former students who are preparing to take legal action against the school with the help of attorneys at Public Council. Among other complaints, she says that computers at the school were in various states of disrepair and that with her limited English she stands little, if any chance, of finding work as a computer operator.

“The school didn’t show me any more English than I knew already and they didn’t show me anything at all about computers,” she said.

And besides, Betancourt said, paying the roughly $12,000 she said she owes the school and the banks would be impossible on her salary of $20 a day.

Similar concerns motivated a group of more than 20 Latino students to organize itself at Webster Career College in Long Beach.

The former students claim that instructors were in such short supply at Webster that one teacher has, at times, simultaneously handled five or six classes. Under pressure to make room in their crowded classrooms for more students--and thus more tuition money--instructors handed out final grades even to those who hadn’t completed their course work, the students said.

“This grade is for a class I never took,” said Rene Chavez, 42, as he held a grade slip showing he received a B in business communication. “How are we going to take that kind of class if we don’t even know (English) grammar?” he added in halting English.

Hodge, the director of operations at Webster, denied the allegations of the former students. She said the school provides its students with a quality education. “We are definitely not perfect, but we do try,” she said.

Regulations governing the trade schools will be debated this week in Sacramento when the Senate Education Committee holds hearings on Assembly Bill 1401, which would strengthen the law.

Lobbyists for the private trade school industry, however, are attempting to loosen restrictions that require at least 60% of the students to complete course work and at least 70% to be placed in jobs for which they were trained. Trade school representatives say the law’s requirements are an unnecessary financial burden to the colleges.

“By and large, the schools offer what they say they offer,” said Anthony Pitale, president of the California Assn. of Private Post-Secondary Schools, one of the lobbyists. “There are problem schools, just like there are problems in any sector of business. But I think a majority of the people in the (Latino) community are being helped. . . . It’s not something that requires a Draconian solution.”

No matter what action the Legislature takes, Carmen Chacon, the packinghouse worker who spent $5,041 for three months of course work at Webster Career College, says she doubts she will ever set foot in another private vocational school.

Instead, she is paying $8 per semester to study English at Paramount High School. After she completes her English studies, she may one day enroll in nearby Compton College, where vocational courses typically cost about $50 per semester.

“Now that all of this has happened to me, I just want to study English first,” she said. “That was the problem in (Webster Career College). We didn’t speak the language; we couldn’t fight back.”