Careers Australia collapsing
A major vocational education provider has gone into voluntary administration.
Careers Australia has stood down its 1,000 staff members without pay, while classes have been cancelled for 15,000 students at its 13 campuses.
Voluntary administrators David McEvoy and Martin Ford of PPB Advisory sent a letter to all staff saying; “We do not currently have sufficient funds available to meet payroll and other costs which would allow us to continue trading the Group on a 'business as usual' basis.”
“Accordingly, we hereby confirm you are stood down effective 25 May 2017 whilst we undertake an urgent assessment of the Group.”
Students were sent a text message saying; “All activities of Careers Australia Group are suspended. No classes, no workplaces effective immediately. Further information will be provided.”
Careers Australia used to enjoy hundreds of millions of dollars worth of taxpayer funding for its training courses, but media investigations have revealed the company targeted vulnerable students by offering computers and other inducements to sign up.
When their earlier sales tactics were banned by the Federal Government, Careers Australia moved to telemarketing, online competitions, and even used employment websites to harvest people's contact details.
Careers Australia last year admitted to “false or misleading representations and engaged in unconscionable conduct” after an ACCC investigation.
“The recent decision by the Federal Department of Education and Training not to approve Career Australia's application to become a VET student loan scheme approved course provider has materially impacted the group's operations,” Mr McEvoy says.
“We are working closely with management and key stakeholders to urgently determine whether the business can be sold or restructured. Regrettably, we have had to suspend all classes and stand down employees while we assess all options available to the business moving forward.”