The Pitfalls of For-Profit Education Analytical Essay by Nicky

This paper focuses on the 2008 Apollo Group fraud case, in which a federal jury ordered the Apollo Group to pay $280 million to shareholders, or $5.55 per share, as a result of a finding of fraud in 2004. The paper explains that Apollo, which runs the University of Phoenix, had misled investors by not divulging a report that found that Apollo systematically tried to keep its recruiting practices hidden from the Department. At the time, the paper reveals, the Apollo Group was paying its recruiters solely on commission based on the number of enrollments they secured. Although the judgment was later reversed, the paper goes on to examine the effects of the judgment, noting that the company's stock price is deteriorating at least in part due to the scandal. The paper recommends that Apollo focus on international markets, which are not impacted by the recruitment scandal, will allow Apollo to continue its current high growth rate while simultaneously reducing the cost to attract each new student. The paper concludes that the fraud scandal is more of a speed bump than a major impediment to future success, and management's strategy should be guided by that fact.

Outline:
Introduction
The Situations in 2004
The External Environment
Recommendations and Conclusion
References