'Mystery' Lismore college goes bust 6 months after opening
A PRIVATE 'college' which used the Federal Government's VET-FEE-HELP system to sell courses ranging from digital media, business and management, and community services has closed in Lismore a little more than six months after opening.
Keystone College opened their premises on Molesworth St in June last year which was followed by an official opening before Christmas.
The mainly Queensland-based private college, which funded itself via student loans covered for by the Federal Government, also had campuses in high-unemployment hotspots such as Southport, Nambour, Warwick, and in Geelong and outer Melbourne in Victoria.
Keystone is one of several private training colleges in the vocational education sector which have been accused of poor graduation rates and high course costs and pushy sales tactics to prospective students.
Courses were expensive, with Keystone's diploma of business costing a whopping $13,990 compared to the same course at a TAFE in Lismore for $4,990.
Their Diploma of Community Services was $17,990 compared to a TAFE subsidised equivalent for under $5,000 or $11,605 for full fee students.
Last year The Australian newspaper reported that Keystone's parent company, the College of Creative Design and Arts, had only 32 students complete its courses last year across its several subsidiary colleges, but received more than $35 million in government-funded VET FEE-HELP loans and had 3576 students enrolled.
The College of Creative Design and Arts was also named as one of six of the top 10 private training organisations in Australia accused of having questionable practices that fell under regulatory scrutiny.
The ABC's 7.30 reported that the CCDA's parent company Global Intellectual Holdings went into administration last month.
The 7.30 program also interviewed a Victorian spruiker for the one of CCDA's colleges who criticised the college's high-pressure sales tactics, which in one case included signing up a retired disabled woman to a $22,500 diploma of interactive digital media which she couldn't complete.
On the Keystone College website, which shows no signs the company has gone bust, it claims "eligible students can start studying with no upfront tuition costs" because the courses all had VET-FEE-HELP approved.
Its self-described "blended learning methods" involved a combination of on-campus and remote learning.
Keystone College, the College of Design and Arts, and the company's administrators Hall Chadwick were contacted for this story but did not respond.
The widely criticised VET-FEE-HELP system now under review was introduced has been accused of allowing some unscrupulous training organisations to take advantage of people ill-equipped to complete courses or offer unsatisfactory content, well below the level of TAFE, while charging exorbitant rates.
Since it was introduced in 2008 and then extended in 2009, Commonwealth funding for the system - which is essentially like the HECS system (Higher Education Contribution Scheme) for vocational education - has blown out from $25 million to about $1.3 billion in 2014.
Unlike HECS however, students pay the full cost of courses, and their cost is completely deregulated, allowing students to be slugged with huge debts.