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Parents seeking refunds after beauty school goes out of business

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Posted at 6:00 AM, Jul 06, 2021
and last updated 2021-07-06 07:18:08-04

BALTIMORE — For the last 50 years, Robert Paul Academy taught students about cosmetology, then it suddenly closed its doors in March. However, there's some unfinished business. Students are still waiting on refunds.

Reduced enrollment and COVID-19 mandates impacted the school financially and Robert Paul Academy couldn't continue operating.

Students were notified on February 3 that the school would officially close on March 15. Several months later, parents tell WMAR-2 News they're still waiting on tuition refunds.

One parent said they paid $2,625 and her daughter was only in class for three weeks then the school abruptly shut down. Her daughter didn't want to be transferred to the other recommended schools, instead they wanted a refund.

The Maryland Higher Education Commission (MHEC) oversees the state's public and private colleges and universities and for-profit career schools. According to a Commission spokeswoman, the family is eligible for a refund, but it’s unclear how long it'll take.

“The timeline for a refund depends on a number of factors (such as requirements by the financial entity, legal obligations, etc.) and will be unique to each school closure,” wrote Rhonda Wardlaw, director of communications for MHEC, in an email to WMAR-2 News Mallory Sofastaii.

Sofastaii asked where the money for refunds comes from.

MHEC requires private career schools to provide a financial guarantee in the form of a surety bond or letter of credit. If that doesn't cover the refunds, MHEC can draw from its Guaranty Student Tuition Fund.

“It is imperative that the Maryland Higher Education Commission can rely on its due diligence to protect students, prior to any private career school closing,” Secretary of Maryland Higher Education Dr. James D. Fielder said. "Before a private career school is even allowed to operate in Maryland, the institution is required to provide financial guarantees that ensure the students are protected, should the institution close. These critical measures allow student protection prior to the student ever stepping into a private career school classroom."

Fifty-one students were enrolled in the school at the time of closure. So far, nine refund claims have been submitted.

And in the last two years, 11 Maryland collegiate and private career schools have closed.

“MHEC anticipates that more requests will be filed in the coming months, so the total for all refund requests is still pending. After a refund request is received, MHEC reviews the accompanying documentation to ensure that the student is eligible for a refund and that the requested amount is accurate before disbursing any funds,” wrote Wardlaw.

In the meantime, if you have a complaint with a Maryland college, university, or private career school, your first step is to file a complaint with the institution.

If it's not resolved, you can file a complaint with MHEC by clicking here.