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Friday, April 29, 2011

California Culinary Academy: SF Weekly Exposé Spawns $40 Million Settlement

Posted By on Fri, Apr 29, 2011 at 4:30 PM

click to enlarge Some students are getting their money back.
  • Some students are getting their money back.

In 2007, SF Weekly investigative reporter Eliza Strickland ran a blockbuster story, demonstrating how the California Culinary Academy urged students to take on tens of thousands of dollars in government loans to pay for what many graduates considered substandard training. She learned that the San Francisco cooking school was part of a profitable industry notorious for bilking the students -- and the government, while raking in tons of money.

"There was a shocking lack of oversight," Strickland said when I spoke with her from her New York City home. "These companies weren't following the laws, and there was no one there to help them into accountable."

Nobody, perhaps, apart from Strickland herself. The June 6, 2007, issue of SF Weekly was picked up by the wife of Ray Gallo, a San Rafael plaintiff's attorney.

Burnt Chefs
  • Burnt Chefs

"She handed it to me. I read it, and my wife said, 'This is really terrible. Maybe you could help these people,'" Gallo recalls.

Gallo found some of the former students Strickland had met during her reporting. Word got around. Some 500 former students who felt

they'd been duped by the school into taking on loads of debt to pay for

shoddy classes came out of the woodwork.

After three years of legal complaints, depositions, and other courthouse

maneuvers, notices went out earlier this month to students who attended

the school between 2003 and 2008, saying they might get a piece of a $40 million settlement from CCA's parent, Career Education Corporation.

"Eliza did an important piece of work, and it opened the door to this lawsuit, which has afforded the class members with some relief from the problems that she described," Gallo says. "That's a great example of what good investigative journalism can do."

Strickland didn't yet know about the settlement when SF Weekly called her earlier this week.

"I'm very pleased to have helped out those students to some degree," she says. "The students I talked to -- and the graduates I talked to --  were in bad shape, and pretty depressed about wasting a lot of money on this program."

She continues: "Some were in pretty dire financial straits because they had put all their savings into this program and were paying ruinous interest rates.

If I helped a few people pay off those loans, I'd be very happy."

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Matt Smith

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