A lawsuit has been filed on behalf of buyers of stock of Strayer Education Inc., which has campuses mainly in the South and Southeast U.S., including in Charlotte.
The suit, filed in Florida, claims Strayer, which offers undergraduate and graduate degrees, and its officers and executives violated the Securities and Exchange Act of 1934 by issuing false and misleading statements about the company’s financial results.
Plaintiffs allege, among other things, that the company did not disclose that it had engaged in improper and deceptive recruiting and financial aid-lending practices.
According to the lawsuit, on Aug. 13, after the market closed, the U.S. Department of Education released data showing federal student loan repayment rates were 54 percent at public colleges and 56 percent at private nonprofit institutions compared with just 36 percent at for-profit colleges. The same data showed repayment rates at Strayer were just 25 percent, according to the lawsuit, which says Strayer’s stock fell 18.37 percent, or $36.75 a share, on the following trading day.
The lawsuit affects those who bought the company’s stock from Nov. 1, 2007, to Aug. 13, 2010.