Quebec agrees to tighten regulations surrounding private colleges

The Quebec government says it is taking steps to tighten regulation of private colleges in the province following a CBC report about three institutions that filed for protection from their creditors earlier this year.

Danielle McCann, the province’s higher education minister, said in a statement that she plans to put measures in place “to ensure this type of situation never happens again.”

Measures include evaluating the process for “issuing, renewing or amending private college licenses”.

A student recruitment agency, Rising Phoenix, and three affiliated colleges – M College in Montreal, CCSQ College in Longueuil and CDE College in Sherbrooke – closed their doors and filed for creditor protection in January, leaving hundreds of international students in uncertainty.

The recruiting agency and the colleges were run by Caroline Mastantuono and members of her family.

Caroline was fired from her position as International Program Manager for the Lester B. Pearson School Board in 2016 on suspicion of financial wrongdoing. His children Joseph and Caroline also worked there and were laid off around the same time.

Quebec’s anti-corruption unit, UPAC, was called in to investigate, and Caroline Mastantuono and her daughter, Christina, were eventually charged with fraud for acts allegedly committed at the school board between 2014 and 2016.

Quebec’s Ministry of Higher Education granted the Mastantuonos a license to operate M College in the summer of 2019, even though the UPAC investigation was ongoing, and a 2016 provincial audit found a litany of ‘”Irregularities” with the Lester B. Pearson Council International Program.

The Mastantuonos then acquired CDE and CCSQ colleges in the spring of 2020, just months before Caroline and Christina were charged with fraud.

(The Mastantuonos did not have to apply for permits for these colleges, as they were already designated and already accredited educational institutions.)

Collège M in the LaSalle borough of Montreal, along with two other colleges and a student recruiting firm, filed for protection from their creditors in January. Hundreds of students have seen their studies interrupted. (Ivanoh Demers/Radio-Canada)

Both Caroline and Christina have pleaded not guilty to the fraud charges, which have not been proven in court.

They declined to comment for this story. Joseph, who was president of the three colleges at the time the petition for creditor protection was filed, also declined to comment.

Back to school for some, uncertain future for others

A new company, led by Toronto-based Cestar International Education Group, bought the colleges last week.

This purchase should allow many students to resume their studies, but for hundreds more seeking reimbursement, they are still not sure of getting their money back.

Students have not attended classes since late November 2021, when colleges went on winter vacation.

The new owner, which already operates private colleges in Ontario, as well as one in Quebec, has provided bridge funding to rehire teachers and support staff so colleges can reopen as early as this week.

Students should soon receive a course schedule, but classes will remain online until the summer session, according to an email sent to students by the new administration.

Ritik Sharma, who lives in India, says he applied for a refund from CDE College last May after not receiving his study permit. He paid $15,000 in college. (Submitted by Ritik Sharma)

“Please note that the timings offered are designed to slightly speed up your schedule to make up for lost time as much as possible,” the email reads.

A total of 308 international students from the three colleges are still awaiting study visas to come to Canada, according to Richter Inc., the court-appointed monitor for Rising Phoenix’s insolvency case.

If someone from this group of students is refused a visa, the new owner will reimburse their tuition fees, said Olivier Benchaya, a partner in the company’s restructuring group.

Another 502 students who previously applied for a refund because their visa was denied or they withdrew from college will be given the opportunity to reapply, Benchaya said.

If they cannot obtain a visa, the amount of their reimbursement will depend on the amount of money remaining for unsecured creditors at the end of the insolvency proceedings.

“I just want my refund”

Ritik Sharma, who applied for a refund from CDE College last May after waiting more than a year for his study permit, said he was no longer interested in studying in Canada.

“I don’t want to take any risks now,” said Sharma, who lives in Punjab state in northern India.

“I just want my refund. Nothing else.”

Anh Vo understands Sharma’s frustration. Her great-nephew in Vietnam applied to a private college, the Higher Institute of Computer Science (ISI) in 2020, through a recruiting agent who worked for Rising Phoenix International.

When his visa wasn’t approved last fall, he asked the college for a refund of the money he sent — nearly $15,000. Vo said their family was shocked to learn that the ISI never received this payment.

After his study visa was refused, 19-year-old Tuan Kiet Dang, who lives in Vietnam, tried to get his tuition refunded. He found he had paid the private college’s third-party recruiter, who filed for creditor protection in January. (Tuan Kiet Dang)

Vo said she assumed the family paid ISI directly, but later discovered that Rising Phoenix collected the tuition on behalf of the college, using an email containing ISI’s name.

Last September, ISI sued Rising Phoenix for $17 million. The case is currently in arbitration and a decision is pending.

Vo, who lives in Brossard, on the South Shore of Montreal, said the whole experience was incredibly disappointing and said her extended family in Vietnam felt “like the sky had fallen on her”.

“They’re not super rich people,” she said.

Trial planned for next year

After being indicted in 2020, Caroline and Christina retired from administration of the colleges and Rising Phoenix. Joseph Mastantuono, Caroline’s son, remained president of the three colleges.

In November 2021, Caroline returned as President of Rising Phoenix.

In their filing for creditor protection, Rising Phoenix and the colleges blamed their financial troubles on the pandemic, untimely expansion and long delays for student visas.

The fraud trial is scheduled to begin in January 2023.

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