2005 California Education Code Sections 94800-94848 Institutions Approved Under This Chapter

94800.  All institutions approved under this chapter shall be
maintained and operated, or in the case of a new institution, shall
demonstrate that it will be maintained and operated, in compliance
with all of the following minimum standards:
   (a) That the institution is financially capable of fulfilling its
commitments to its students.
   (b) That upon satisfactory completion of training, the student is
given an appropriate degree, diploma, or certificate by the
institution, indicating that the course or courses of instruction or
the program or programs of instruction or study have been
satisfactorily completed by the student.
   (c) That the institution provides instruction as part of its
educational program.  Instruction shall include any specific, formal
arrangement by an institution for its enrollees to participate in
learning experiences wherein the institution's faculty or contracted
instructors present a planned curriculum appropriate to the enrollee'
s educational program.
94802.  (a) Each institution desiring to operate in this state shall
make application to the bureau, upon forms to be provided by the
bureau.  The application shall include, as a minimum, at least all of
the following:
   (1) A catalog published, or proposed to be published, by the
institution containing the information specified in the criteria
adopted by the bureau.  The catalog shall include specific dates as
to when the catalog applies.
   (2) A description of the institution's placement assistance, if
any.
   (3) Copies of media advertising and promotional literature.
   (4) Copies of all student enrollment agreement or contract forms
and instruments evidencing indebtedness.
   (5) The name and California address of a designated agent upon
whom any process, notice, or demand may be served.
   (6) The information specified in Section 94808.
   (7) The institution's most current financial report as described
in Section 94806.
   (8) An application submitted by a non-WASC regionally  accredited
institution, as defined in Section 94740.5, shall include a copy of
the certificate of accreditation issued by the non-WASC regional
accrediting agency, as defined in Section 94740.3.
   (b) Each application shall be signed and certified under oath by
the owners of the school or, if the school is incorporated, by the
principal owners of the school (those who own at least 10 percent of
the stock), or by the corporate officers or their designee.
   (c) Following review of the application and any other further
information submitted by the applicant, or required in conformity
with Article 8 (commencing with Section 94900) and Article 9
(commencing with Section 94915), and any investigation of the
applicant as the bureau deems necessary or appropriate, the bureau
either shall grant or deny approval to operate to the applicant.
94804.  (a) The review of a private postsecondary educational
institution's original application for approval, or a renewal
application to the council, or an approved institution already in
operation, shall include a determination of the institution's
financial responsibility.  An institution shall be considered
financially responsible if it has sufficient assets to do all of the
following:
   (1) Provide the educational services stated in its official
publications and statements.
   (2) Comply with the standards and requirements specified in
Article 8 (commencing with Section 94900), Article 9 (commencing with
Section 94915), or Article 9.5 (commencing with Section 94931),
whichever is applicable.
   (3) Provide the administrative and financial resources to fully
comply with this article.
   (4) Comply with any applicable provisions of Section 94855.
   (b) An institution shall not be considered financially responsible
under any of the following conditions:
   (1) The institution fails to have available sufficient funds and
accounts receivable to pay all operating expenses due within 30 days.
  For the purpose of this paragraph, "funds" means cash or assets
that can be converted into cash within seven days.
   (2) Under generally accepted accounting principles, the
institution had, at the end of its latest fiscal year, a ratio of
current assets to current liabilities of less than 1.25 to 1.  For
the purpose of this paragraph, "current assets" does not include any
of the following:  (A) intangible assets, including goodwill, going
concern value, organization expense, startup costs, long-term
prepayment of deferred charges, and nonreturnable deposits, or (B)
state or federal grant funds that are not the property of the
institution but are held for future disbursement for the benefit of
students.  Unearned tuition shall be accounted for in accordance with
  generally accepted accounting principles.  When another government
agency requires an institution to file annual financial audit
prepared by a certified public accountant, that agency's current
ratio standard may apply in lieu of the ratio specified in this
paragraph if the ratio of current assets to current liabilities under
that standard is 1 to 1 or greater.
   (c) (1) In determining an institution's compliance with
subdivision (a), the council, at the institution's request, may
consider the financial resources of a parent corporation if the
parent corporation files with the council, and at all times complies
with, an irrevocable and unconditional agreement approved by its
board of directors that satisfies all of the requirements of
paragraph (2):
   (2) The agreement described in paragraph (1) shall provide that
the parent corporation do all of the following:
   (A) Consent to be sued in California.
   (B) Consent to be subject to the administrative jurisdiction of
the council and the Student Aid Commission in connection with the
institution's compliance with this chapter.
   (C) Appoint an agent for service of process in California and all
notices required by this chapter.
   (D) Agree to pay any refund, claim, penalty, or judgment that the
institution is obligated to pay.
   (E) File financial reports, maintain financial records, and permit
the inspection and copying of financial records to the same extent
as is required of the institution.
   (3) For the purposes of this subdivision, a "parent corporation"
means a corporation that owns more than 80 percent of the stock of
the institution whose financial resources are at issue.
   (d) If the council determines that an institution is not
financially responsible, the council, under terms and conditions
prescribed by the council, may require the institution to submit for
its latest complete fiscal year and its current fiscal year, each of
the following:
   (1) A financial audit of the institution conducted by a licensed
certified public accountant, in accordance with generally accepted
auditing standards.
   (2) The institution's financial plan for establishing financial
responsibility.
   (3) Any other information requested by the council.
   This subdivision does not prevent the council from taking any
other actions authorized under this chapter.
94806.  (a) This section applies to every audit, review, and
statement prepared by an independent accountant and to every
financial report required to be prepared or filed by this chapter.
   (b) Institutional audits and reviews of financial data, including
the preparation of financial statements, shall comply with all of the
following:
   (1) An institution that collected  seven hundred fifty thousand
dollars ($750,000) or more in total student charges in its preceding
fiscal year shall file financial reports prepared in accordance with
generally accepted accounting principles established by the American
Institute of Certified Public Accountants, and audited or reviewed by
an independent certified public accountant who is not an employee,
officer, or corporate director or member of the governing board of
the institution.
   (2) An institution that collected less than  seven hundred fifty
thousand dollars ($750,000) in total student charges in its preceding
fiscal year shall file financial reports prepared in accordance with
generally accepted accounting principles established by the American
Institute of Certified Public Accountants.  These financial reports
may be prepared by an individual with sufficient training to adhere
to the required accounting principles.
   (3) Financial reports prepared on an annual basis shall include a
balance sheet, statement of operations, statement of cash-flow, and
statement of retained earnings or capital.  Nonprofit institutions
shall provide this information in the manner required under generally
accepted accounting principles for nonprofit organizations.
   (4) The financial report shall establish whether the institution
complies with subdivision (a) of Section 94804 or subdivision (a) of
Section 94855, if applicable, and whether any of the circumstances
described in subdivision (b) of Section 94804 or subdivision (b) of
Section 94855, if applicable, exist.
   (5) If an audit that is performed to determine compliance with any
federal or state student financial aid program reveals any failure
to comply with the requirements of the program, and the noncompliance
creates any liability or potential liability for the institution,
the financial report shall reflect the liability or potential
liability.
   (6) Work papers for the financial statements shall be retained for
five years from the date of the reports, and shall be made available
to the bureau upon request after completion of the report.
   (c) Any audits shall be conducted in accordance with generally
accepted auditing standards, and shall include the matters described
in subdivision (d).
   (d) If an audit is conducted, the accountant shall obtain an
understanding of the institution's internal financial control
structure, assess any risks, and report any material deficiencies in
the internal controls.
   (e) Any audit or financial report shall contain a statement signed
by the individual who has prepared the report stating that the
institution has paid or has not paid to the bureau all amounts owed
under Section 94945.  If the institution is a corporation that is
publicly traded on a national stock exchange, the submission of the
corporation's annual report shall be deemed to comply with this
section.  The bureau shall be deemed an intended beneficiary of that
statement in any audit or financial report.  An institution that has
not paid all amounts owed to the bureau under Section 94945 shall
report to the bureau within 30 days on its plan to become current in
these payments.  This subdivision shall not be construed to require
the institution to prepare a separate audit or report on the Student
Tuition Recovery Fund.
94808.  (a) Each institution approved to operate under this chapter
shall be required to report to the bureau, by July 1 of each year, or
another date designated by the bureau, the following information for
educational programs offered in the prior fiscal year:
   (1) The total number of students enrolled, by level of degree or
type of diploma program.
   (2) The number of degrees and diplomas awarded, by level of
degree.
   (3) The degree levels offered.
   (4) Program completion rates.
   (5) The schedule of tuition and fees required for each term,
program, course of instruction, or degree offered.
   (6) Financial information demonstrating compliance with
subdivisions (b) and (c) of Section 94804 and subdivisions (b) and
(c) of Section 94855, if applicable.
   (7) Institutions having a probationary or conditional status shall
submit an annual report reviewing their progress in meeting the
standards required for approval status.
   (8) A statement indicating whether the institution is or is not
current on its payments to the Student Tuition Recovery Fund.
   (9) Any additional information that the council may prescribe.
   (b) Colleges and universities operating under paragraph (6) of
subdivision (b) of Section 94739 shall comply with the reporting
requirements of paragraphs (1), (2), (3), and (5) of subdivision (a).
   (c) Program completion rates and placement data shall be reported
in accordance with the standards and criteria prescribed by the
bureau pursuant to paragraphs (1) to (4), inclusive, of subdivision
(a) of Section 94816 and Section 94859, if applicable.  Based on the
review of information submitted to fulfill the requirements of this
section, the bureau may initiate a compliance review and may place
the institution on probation pursuant to subdivision (h) of Section
94901 and subdivision (i) of Section 94915, and may require evidence
of financial stability and responsibility pursuant to Sections 94804
and 94855, if applicable.
94809.  Each institution approved under this chapter shall provide
the council with copies of all accrediting agency reports, including
preliminary reports and reports of visiting committees, all audit
reports prepared by the United States Department of Education and
student loan guaranty agencies, including all preliminary reports,
and the institution's written responses to the reports described in
this section, if applicable.  The institution shall provide a copy of
each report within 15 days of the institution's receipt of the
report and a copy of the institution's response within 15 days of the
institution's submission of its response.
94810.  (a) Any written contract or agreement for educational
services with an institution shall include all of the following:
   (1) On the first page of the agreement or contract, in 12-point
boldface print or larger, the following statement:
   "Any questions or problems concerning this school which have not
been satisfactorily answered or resolved by the school should be
directed to the Bureau for Private Postsecondary and Vocational
Education, (address), Sacramento, California 95814."
   (2) In underlined capital letters on the same page of the contract
or agreement in which the student's signature is required, the total
amount that the student is obligated to pay for the course of
instruction and all other services and facilities furnished or made
available to the student by the school, including any charges made by
the school for tuition, room and board, books, materials, supplies,
shop and studio fees, and any other fees and expenses that the
student will incur upon enrollment.
   (3) A list of any charges and deposits that are nonrefundable
clearly identified as nonrefundable charges.
   (4) The name and address of the school and the addresses where
instruction will be provided.
   (5) The name and description of the program of instruction,
including the total number of credits, classes, hours, or lessons
required to complete the program of instruction.
   (6) A clear and conspicuous statement that the agreement or
contract is a legally binding instrument when signed by the student
and accepted by the school.
   (7) A clear and conspicuous caption, "BUYER'S RIGHT TO CANCEL"
under which it is explained that the student has the right to cancel
the enrollment agreement and obtain a refund, the form and means of
notice that the student should use in the event that he or she elects
to cancel the enrollment agreement, and the title and address of the
school official to whom the notice should be sent or delivered.
   (8) A clear statement of the refund policy written in plain
English.
   (9) The signature of the student under the following statement
that is presented in 12-point boldface or larger print:  "My
signature below certifies that I have read, understood, and agreed to
my rights and responsibilities, and that the institution's
cancellation and refund policies have been clearly explained to me."
   (10) If the student is not a resident of California or is the
recipient of third-party payor tuition and course costs, such as
workforce investment vouchers or rehabilitation funding, a clear
statement that the student is not eligible for protection under and
recovery from the Student Tuition Recovery Fund.
   (11) A statement that the student is responsible for paying the
state assessment amount for the Student Tuition Recovery Fund.
   (b) All contracts and enrollment agreements signed by the student
shall be written in language that is capable of being easily
understood.  If English is not the primary language spoken by the
student, the student shall have the right to obtain a clear
explanation of the terms and conditions of the agreement and all
cancellation and refund policies in his or her primary language.
94812.  Any written contract or agreement signed by a prospective
student shall not become operative until the student attends the
first class or session of instruction.  This provision does not apply
to correspondence schools or other distance-learning programs.
94814.  (a) The institution shall provide to students and other
interested persons, prior to enrollment, a catalog or brochure
containing at a minimum the following information:
   (1) Descriptions of the instruction provided under each course
offered by the institution including the length of programs offered.
   (2) The number of credit hours or clock hours of instruction or
training per unit or units required for completion of the educational
degree or certificate program.
   (3) The attendance, dropout, and leave-of-absence policies.
   (4) The faculty and their qualifications.
   (5) The schedule of tuition payments, fees, and all other charges
and expenses necessary for the term of instruction and the completion
of the course of study.
   (6) The cancellation and refund policies.
   (7) For institutions that participate in federal and state
financial aid programs, all consumer information that the institution
is required to disclose to the student.
   (8) All other material facts concerning the institution and the
program or course of instruction that are reasonably likely to affect
the decision of the student to enroll, as prescribed by rules and
regulations adopted by the council.
   (b) No written contract signed by the student shall be enforceable
unless the information specified in subdivision (a) has been
disclosed to the student.
94814.5.  (a) Each institution subject to this article, and offering
a doctoral degree in psychology designed to prepare students for a
license to practice psychology in California, shall provide to each
prospective student in professional psychology a California
Unaccredited Graduate Psychology School Disclosure Form that
discloses all of the following information:
   (1) The number of graduates of the institution who have taken, and
the number of graduates of the institution who have passed, the
psychology written licensing examination administered by the
California Board of Psychology during the immediately preceding four
years.
   (2) The number of graduates of the institution who have taken, and
the number of graduates of the institution who have passed, the
psychology oral licensing examination administered by the California
Board of Psychology during the immediately preceding four years.
   (3) The number of graduates of the institution who have become
licensed psychologists in the State of California during the
immediately preceding four years.
   (4) The practice limitations imposed on graduates of the
institution who hold doctoral degrees in psychology.  This paragraph
shall be in 14-point boldface type, and shall read as follows:
   "Prospective students should be aware that as a graduate of an
unaccredited school of psychology you may face restrictions that
could include difficulty in obtaining licensing in a state outside of
California and difficulty in obtaining a teaching job or appointment
at an accredited college or university.  It may also be difficult to
work as a psychologist for some federal government or other public
agencies, or to be appointed to the medical staff of a hospital.
Some major managed care organizations, insurance companies, or
preferred provider organizations may not reimburse individuals whose
degrees are from unaccredited schools.  Graduates of unaccredited
schools may also face limitations in their abilities to be listed in
the "National Register of Health Service Providers' or to hold
memberships in other major organizations of psychologists."
   (b) Annually, each institution shall provide to the bureau a copy
of the disclosure form signed by each student who has enrolled in any
course during the year that may be used in the graduate education
leading to a doctoral degree in psychology that qualifies the
graduate as a candidate for the psychology licensure examination.
   (c) If an institution fails to satisfy any of the requirements of
this section, the bureau may revoke the institution's approval to
operate or to offer the psychology degree that leads to licensure as
a psychologist, or may impose either an administrative penalty or a
civil penalty not to exceed ten thousand dollars ($10,000) per noted
violation.
94816.  (a) Each institution offering a degree or diploma program
designed to prepare students for a particular vocational, trade, or
career field shall provide to each prospective student a school
performance fact sheet disclosing all of the following information:
   (1) The number and percentage of students who begin the
institution's program and successfully complete the entire program.
The rate shall be calculated by determining the percentage of
students enrolled in the program who were originally scheduled, at
the time of enrollment, to complete the program in that calendar year
and who successfully completed the program.
   (2) The passage rates of graduates in the program for the most
recent calendar year that ended not less than six months prior to the
date of disclosure on any licensure or certificate examination
required by the state for employment in the particular vocational,
trade, or career field and for any licensing preparation examination
as required under subdivision (a) of Section 94734 for which data is
available.
   (3) The number and percentage of students who begin the program
and secure employment in the field for which they were trained.  In
calculating this rate, the institution shall consider as not having
obtained employment, any graduate for whom the institution does not
possess evidence, documented in his or her file, showing that he or
she has obtained employment in the occupation for which the program
is offered.
   (4) The average annual starting wages or salary of graduates of
the institution's program, if the institution makes a claim to
prospective students regarding the starting salaries of its
graduates, or the starting salaries or local availability of jobs in
a field.  The institution shall disclose to the prospective student
the objective sources of information necessary to substantiate the
truthfulness of the claim.
   Each school that offers or advertises placement assistance for any
course of instruction shall file with the council its placement
statistics for the 12-month period or calendar year immediately
preceding the date of the school's application for annual review for
every course of instruction.
   The council shall develop standards and criteria to be used by
each institution in determining the statistical information required
by this paragraph.
   (b) In addition to the fact sheet required by subdivision (a),
each institution offering a degree program designed to prepare
students for a particular vocation, trade, or career field and each
institution subject to Article 7 (commencing with Section 94850)
shall provide to each prospective student a statement in at least
12-point type that contains the following statement:
      "NOTICE CONCERNING TRANSFERABILITY OF UNITS AND DEGREES EARNED
AT OUR SCHOOL
   Units you earn in our ____ (fill in name of program) program in
most cases will probably not be transferable to any other college or
university.  For example, if you entered our school as a freshman,
you will still be a freshman if you enter another college or
university at some time in the future even though you earned units
here at our school.  In addition, if you earn a degree, diploma, or
certificate in our ____ (fill in name of program) program, in most
cases it will probably not serve as a basis for obtaining a higher
level degree at another college or university."
   The disclosures required by this section shall be signed by the
institution and the student and be dated.  If the solicitation or
negotiation leading to the agreement for a course of instruction was
in a language other than English, the disclosures shall be in that
other language.
   (c) The council shall take into consideration the character of the
educational program in determining whether specific programs may be
excluded from application of this section.
   (d) Except as provided in subdivision (b), this section does not
apply to educational programs subject to Article 7 (commencing with
Section 94850).
94818.  (a) Every institution shall designate and maintain an agent
for service of process within this state and provide the name,
address, and telephone number of the agent to the council.  The
council shall furnish the agent's name, address, and telephone number
to any person upon request.
   (b) If an institution is not operating in California when it
applies for approval to operate, the institution shall set forth the
name, address, and telephone number of its agent for service of
process in the institution's application.
   (c) If an institution fails to designate or maintain an agent for
service of process pursuant to subdivision (a) and if service on the
institution cannot reasonably be effected in the manner provided in
Section 415.10, 415.20, 415.30, or 415.40 of the Code of Civil
Procedure, the institution may be served by leaving a copy of the
process or any other document in an office of the council and by
sending, by first-class mail, a notice of the service upon the
council and a copy of the process or other document to the
institution at its last address on file with the council.  Service in
this manner shall be deemed complete on the 10th day after that
mailing to the institution.  Proof of service may be made by a
declaration showing compliance with this subdivision.
94819.  Within 30 days of any action by any accrediting agency that
establishes, reaffirms, or publicly sanctions the accreditation of
any private postsecondary educational institution operating in the
state, including those institutions that satisfy the requirements of
paragraph (7) of subdivision (b) of Section 94739, the accrediting
agency shall notify the bureau of that action and shall provide a
copy of any public statements regarding the reasons for the
accrediting agency's action.
94820.  (a) The institution shall have and maintain the policy set
forth in this article for the refund of the unused portion of tuition
fees and other charges if the student does not register for the
period of attendance or withdraws therefrom at any time prior to
completion of the courses, or otherwise fails to complete the period
of enrollment.  The institutional refund policy for students who have
completed 60 percent or less of the course of instruction shall be a
pro rata refund.
   (b) Except as provided in subdivision (c), the refund shall be
calculated as follows:
   (1) Deduct a registration fee not to exceed one hundred dollars
($100) from the total tuition charge.
   (2) Divide this figure by the number of hours in the program.
   (3) The quotient is the hourly charge for the program.
   (4) The amount owed by the student for the purposes of calculating
a refund is derived by multiplying the total hours attended by the
hourly charge for instruction plus the amount of the registration fee
specified in paragraph (1).
   (5) The refund shall be any amount in excess of the figure derived
in paragraph (4) that was paid by the student.
   (c) For an educational service offered by distance learning, home
study, or correspondence, the refund shall be calculated as follows:
   (1) Deduct a registration fee not to exceed one hundred ($100)
from the total tuition charge.
   (2) Divide this figure by the number of lessons in the program.
   (3) The quotient is the per-lesson charge.
   (4) The amount owed by the student for the purposes of calculating
a refund is derived by multiplying the total number of lessons
received by the per-lesson charge calculated in paragraph (3) plus
the amount of the registration fee specified in paragraph (1).
   (5) The refund shall be any amount in excess of the figure derived
in paragraph (4) that was paid by the student.
   (d) For the purposes of this section, institutions may specify in
enrollment agreements the time limits within which students are
required to complete the requirements of a course in a distance
learning program.
94821.  Institutions offering distance learning, home study, or
correspondence instruction may petition the council for an
alternative method of calculating tuition refunds if they can
demonstrate all of the following:
   (a) The method of calculation set forth in subdivision (c) of
Section 94820 cannot be utilized.
   (b) The proposed alternative method will result in the calculation
of a refund that is monetarily equivalent to or greater than the
results achieved by the pro rata calculations described in this
subdivision.
94822.  Institutions, for all students, without penalty or
obligation, shall refund 100 percent of the amount paid for
institutional charges, less a reasonable deposit or application fee
not to exceed one hundred dollars ($100), if notice of cancellation
is made prior to or on the first day of instruction.  If the first
lesson in a home study or correspondence course is sent to the
student by mail, the institution shall send it by first-class mail,
postage prepaid, documented by a certificate of mailing, and the
student shall have the right to cancel until midnight of the eighth
business day after the first lesson was mailed.  The institution
shall advise each student that any notification of withdrawal or
cancellation and any request for a refund is required to be made in
writing.
94823.  The institution shall provide a written statement containing
its refund policy, together with examples of the application of the
policy, to each student prior to signing the enrollment contract, and
shall make its policy known to currently enrolled students.
94824.  The institution shall pay or credit refunds due on a
reasonable or timely basis, not to exceed 30 days following the date
upon which the student's withdrawal has been determined.
94825.  (a) The institution shall publish a current schedule of all
student charges, a statement of the purpose for those charges, and a
statement of the cancellation and refund policies with examples of
the application of the policies, and shall provide the schedule to
all current and prospective students prior to enrollment.  The
schedule shall clearly indicate and differentiate all mandatory and
optional student charges.  The institution shall include a clear
statement written in English describing the procedures that a student
is required to follow to cancel the contract or agreement and obtain
a refund.  If the institution solicited the student or negotiated
the agreement in a language other than English, the notice to the
student shall be in that same language.  The schedule shall specify
the total costs of attendance which shall include, but not
necessarily be limited to, tuition, fees, assessments for the Student
Tuition Recovery Fund, equipment costs, housing, transportation,
books, necessary supplies, materials, shop and studio fees, and any
other fees and expenses that the student will incur upon enrollment.
   The schedule shall clearly identify all charges and deposits that
are nonrefundable.
   (b) The schedule shall also contain both of the following:
   (1) A statement, to be provided by the bureau, specifying that it
is a state requirement that a resident California student who pays
his or her own tuition, either directly or through a loan, is
required to pay a state-imposed fee for the Student Tuition Recovery
Fund.
   (2) A statement, to be provided by the bureau, describing the
purposes, operation, and eligibility requirements of the Student
Tuition Recovery Fund.
94826.  Where the refund calculations set forth in this article
cannot be utilized because of the unique way in which an educational
program is structured, the council shall determine the details of an
alternative refund policy, by regulation, and shall take into
consideration the contract for educational services entered into with
the student, as well as the length and character of the educational
program in determining standards for refunds.  The decision of the
council shall be final.  This section does not apply to the refunds
subject to Sections 94869 and 94870.
94828.  In addition to withholding institutional services as
described in Section 94948, an institution may withhold a student's
transcript or grades if the student is in default on a student
tuition contract.
   If the student has made partial payment of his or her tuition
obligation, the institution may only withhold that portion of the
grades or transcript that corresponds on a pro rata basis to the
amount of tuition or loan obligation the student has not paid.  If
the course of study consists of only one course, the institution may
withhold the grades or the transcript until the tuition or loan
obligation is paid in full.
94829.  (a) Adequate and accurate records shall be maintained by the
institution, in accordance with regulations adopted by the council,
and satisfactory standards shall be enforced relating to attendance,
progress, and performance.
   (b) The institution shall maintain current records for a period of
not less than five years at its principal place of business in
California, that are immediately available during normal business
hours for inspection and copying by the council or the Attorney
General and showing all of the following:
   (1) The name and addresses, both local and home, of each of its
students.
   (2) The programs of study offered by the institution.
   (3) The names and addresses of its faculty, together with a record
of the educational qualifications of each.
   (4) The degrees or diplomas and honorary degrees and diplomas
granted, the date of granting, together with the curricula upon which
the diplomas and degrees were based.
94830.  The council may refuse to issue or renew any private
postsecondary or vocational educational institution's approval to
operate, or may revoke any approval to operate for any one, or any
combination, of the following causes:
   (a) A violation of this chapter, or any standard, rule, or
regulation established under this chapter, or an order of the council
made under this chapter.
   (b) Furnishing false, misleading, or incomplete information to the
council, or the failure to furnish information requested by the
council or required by this chapter.
   (c) A finding that an owner, a person in control, a director, or
an officer of an institution is not in compliance  with this chapter
or was not in compliance with applicable law while serving as an
owner, person in control, director, or officer of an institution
within the previous five-year period.
   (d) A finding that a signatory to an application for an approval
to operate was responsible for the closure of any institution in
which there were unpaid liabilities to any state or federal
government, or uncompensated pecuniary losses suffered by students
without restitution.
   (e) A finding that the applicant, owner, or persons in control
have been found previously in any judicial or administrative
procedure to have violated this chapter or admitted to having
violated this chapter.
   (f) A finding that there was either a denial of a previous
application submitted by the same institution to the council or a
revocation of the institution's approval and that the conditions or
violations that were the cause of the denial or revocation have not
been corrected.
   (g) The failure of the institution to maintain the minimum
educational standards prescribed by this chapter, or to maintain
standards that are the same as, or substantially equivalent to, those
represented in the school's applications and advertising.
   (h) Presenting to prospective students information that is false
or misleading relating to the school, to employment opportunities, or
to enrollment opportunities in institutions of higher learning after
entering into or completing courses offered by the school.
   (i) The failure to maintain financial resources adequate for the
satisfactory conduct of the courses of instruction offered as
required by statute.
   (j) The failure to provide timely and correct refunds to students.
   (k) Paying a commission or valuable consideration to any persons
for acts or services in violation of this chapter.
   (l) Attempting to confer a degree, diploma, or certificate to any
student in violation of this chapter.
   (m) Misrepresenting to any students or prospective students that
they are qualified, upon completion of any course, for admission to
professional examination under any state occupational licensing
provision.
   (n) The failure to correct any deficiency or act of noncompliance
under this chapter, or the standards, rules, regulations, and orders
established and adopted under this chapter within reasonable time
limits set by the council.
   (o) The conducting of business or instructional services at any
location not approved by the council.
   (p) Failure on the part of an institution to comply with
provisions of law or regulations governing sanitary conditions of
that institution specified in Division 2 (commencing with Section
500) and Division 3 (commencing with Section 5000) of the Business
and Professions Code.
   (q) The failure to pay any fees, order for costs and expenses
under Section 94935, assessments, or penalties owed to the council,
as provided in this chapter.
94831.  No institution, or representative of that institution shall
do any of the following:
   (a) Operate in this state a postsecondary educational institution
not exempted from this chapter, unless the institution is currently
approved to operate pursuant to this chapter.  The council may
institute an action, pursuant to Section 94955, to prevent any
individual or entity from operating an institution in this state that
has not been approved to operate pursuant to this chapter and to
obtain any relief authorized by that section.
   (b) Offer in this state, as or through an agent, enrollment or
instruction in, or the granting of educational credentials from, an
institution not exempted from this chapter, whether that institution
is within or outside this state, unless that agent is a natural
person and has a currently valid agent's permit issued pursuant to
this chapter, or accept contracts or enrollment applications from an
agent who does not have a current permit as required by this chapter.
  The council, however, may adopt regulations to permit the rendering
of legitimate public information services without a permit.
   (c) Instruct or educate, or offer to instruct or educate,
including soliciting for those purposes, enroll or offer to enroll,
contract or offer to contract with any person for that purpose, or
award any educational credential, or contract with any institution or
party to perform any act, in this state, whether that person, agent,
group, or entity is located within or without this state, unless
that person, agent, group, or entity observes and is in compliance
with the minimum standards set forth in this article and Article 7
(commencing with Section 94850), if it is applicable, the criteria
established by the council pursuant to subdivision (b) of Section
94773, and the regulations adopted by the council pursuant to
subdivision (c) of Section 94773.
   (d) Use, or allow the use of, any reproduction or facsimile of the
Great Seal of the State of California on any diploma.
   (e) Promise or guarantee employment.
   (f) Advertise concerning job availability, degree of skill and
length of time required to learn a trade or skill unless the
information is accurate and in no way misleading.
   (g) Advertise, or indicate in any promotional material, that
correspondence instruction, or correspondence courses of study are
offered without including in all advertising or promotional material
the fact that the instruction or programs of study are offered by
correspondence or home study.
   (h) Advertise, or indicate in any promotional material, that
resident instruction, or programs of study are offered without
including in all advertising or promotional material the location
where the training is given or the location of the resident
instruction.
   (i) Solicit students for enrollment by causing any advertisement
to be published in "help wanted" columns in any magazine, newspaper,
or publication or use "blind" advertising that fails to identify the
school or institution.
   (j) Advertise, or indicate in any promotional material, that the
institution is accredited, unless the institution has been recognized
or approved as meeting the standards established by an accrediting
agency recognized by the United States Department of Education or the
Committee of Bar Examiners for the State of California.
   (k) Fail to comply with federal requirements relating to the
disclosure of information to students regarding vocational and career
training programs, as described in Section 94816.
94832.  (a) No institution or representative of an institution shall
make or cause to be made any statement that is in any manner untrue
or misleading, either by actual statement, omission, or intimation.
   (b) No institution or representative of an institution shall
engage in any false, deceptive, misleading, or unfair act in
connection with any matter, including the institution's advertising
and promotion, the recruitment of students for enrollment in the
institution, the offer or sale of a program of instruction, course
length, course credits, the withholding of equipment, educational
materials, or loan or grant funds from a student, training and
instruction, the collection of payments, or job placement.
   (c) An institution is liable in any civil or administrative action
or proceeding for any violation of this article committed by a
representative of the institution.  An institution is liable in a
criminal action for violations of this article committed by a
representative of the institution to the extent permitted by law.
   (d) (1) No institution or representative of an institution shall
induce a person to enter into an agreement for a program of
instruction by offering to compensate that person to act as the
institution's representative in the solicitation, referral, or
recruitment of others for enrollment in the institution.
   (2) No institution or representative of an institution shall offer
to pay or pay any consideration to a student or prospective student
to act as a representative of the institution with regard to the
solicitation, referral, or recruitment of any person for enrollment
in the institution in either of the following:
   (A) During the 60-day period following the date on which the
student began the program.
   (B) At any subsequent time, if the student has not maintained
satisfactory academic progress in acquiring the necessary level of
education, training, skill, and experience to obtain employment in
the occupation or job title to which the program is represented to
lead.  The institution shall have the burden of proof to establish
that the student has maintained satisfactory academic progress.
   (e) No institution shall compensate a representative involved in
recruitment, enrollment, admissions, student attendance, or sales of
equipment to students on the basis of a commission, commission draw,
bonus, quota, or other similar method except as follows:
   (1) If the program of instruction is scheduled to be completed in
90 days or less, the institution shall pay compensation related to a
particular student only if that student completes the course.
   (2) If the program of instruction is scheduled to be completed in
more than 90 days, the institution shall pay compensation related to
a particular student as follows:
   (A) No compensation shall be paid for at least 90 days after that
student has begun the program.
   (B) Up to one-half of the compensation may be paid before the
student completes the program only if the student has made
satisfactory academic progress, documented by the institution in the
student's file, for more than 90 days.
   (C) The remainder of the compensation shall be paid only after the
student's completion of the program.  This subdivision shall not
prevent the payment at any time of an hourly, weekly, monthly, or
annual wage or salary.
   (f) No institution or representative of an institution shall pay
any consideration to a person to induce that person to sign an
agreement for a program of instruction.
   (g) No institution shall use a misleading name in any manner
implying any of the following:
   (1) The institution is affiliated with any governmental agency,
public or private corporation, agency, or association.
   (2) The institution is a public institution.
   (3) The institution grants degrees.
   (h) (1) No institution or any representative of an institution
shall in any manner make any untrue or misleading change in, or
untrue or misleading statement related to, any test score, grade,
record of grades, attendance record, record indicating student
completion or employment, financial information, including any of the
following:
   (A) Any financial report required to be filed pursuant to Sections
94804 to 94808, inclusive.
   (B) Any information or record relating to the student's
eligibility for financial assistance or attendance at the
institution.
   (C) Any other record or document required by this chapter or by
the council.
   (2) No institution or any representative of an institution shall
falsify, destroy, or conceal any record or other item described in
paragraph (1) while that record or item is required to be maintained
by this chapter or by the council.
   (i) No institution or representative of an institution shall use
the terms "approval," "approved," "approval to operate," or "approved
to operate" without stating clearly and conspicuously that approval
to operate means compliance with minimum state standards and does not
imply any endorsement or recommendation by the state or by the
council.  If the council has granted an institution approval to
operate, the institution or its representative may indicate that the
institution is "licensed" or "licensed to operate" but may not state
or imply any of the following:
   (1) The institution or its programs of instruction are endorsed or
recommended by the state or by the council.
   (2) The council's grant to the institution of approval to operate
indicates that the institution exceeds minimum state standards.
   (3) The council or the state endorses or recommends the
institution.
   (j) No institution offering programs or courses of instruction
represented to lead to occupations or job titles requiring licensure
shall enter into an agreement for a course of instruction with a
person whom the institution knows or, by the exercise of reasonable
care, should know, would be ineligible to obtain licensure in the
occupation or job title to which the course of instruction is
represented to lead, at the time of the scheduled date of course
completion, for reasons such as age, physical characteristics, or
relevant past criminal conviction.
   (k) No institution shall divide or structure a program of
instruction or educational service to avoid the  application of any
provision of this chapter.
   (l) No institution or representative of an institution shall
direct a representative to perform any unlawful act, to refrain from
complaining or reporting unlawful conduct to the council or another
government agency, or to engage in any unfair act to persuade a
student not to complain to the council or another government agency.
94834.  (a) Any person or business entity, regardless of the form of
organization that willfully violates Section 94800, Sections 94810
to 94826, inclusive, or Section 94828, 94829, 94831, or 94832 is
guilty of a crime and shall be subject to separate punishment for
each violation either by imprisonment in a county jail not to exceed
one year, by a fine not to exceed ten thousand dollars ($10,000), or
by both that imprisonment and fine; or by imprisonment in the state
prison, by a fine not to exceed fifty thousand dollars ($50,000), or
by both that imprisonment and fine.
   (b) Notwithstanding any other law, any prosecution under this
section shall be commenced within three years of the discovery of the
facts constituting grounds for commencing the prosecution.
   (c) The penalties provided by this section supplement, but do not
supplant, the remedies and penalties provided under other law.
   (d) In addition to any other fines or penalties imposed pursuant
to this section, any person or business entity found guilty of a
crime as described in subdivision (a) shall be ordered to pay the
Attorney General, any district attorney, or any city attorney all of
their costs and expenses in connection with any investigation
incident to that prosecution.  An institution shall not be required
to pay the same costs and expenses to more than one investigating
agency.
94835.  (a) The council shall review and investigate all
institutions, programs, and courses of instruction approved under
this chapter.  Consideration in the scheduling of reviews and
investigations shall be afforded to student complaints and
information collected by the Attorney General, the Student Aid
Commission, any board within the Department of Consumer Affairs, or
any other federal, state, or local agency.  The council also shall
conduct periodic unannounced reviews and investigations of
institutions to determine compliance with this chapter.
   (b) At the council's request in connection with an investigation
to determine compliance with this chapter, an institution, during its
normal business hours, shall immediately make available for
inspection and copying all records required to be maintained by this
chapter or that relate to the institution's compliance with this
chapter and permit the council's representatives to have immediate
access to the institution's primary administrative location and sites
of instruction during the institution's normal business hours to
examine and copy these records, to inspect the institution's physical
facilities, equipment, library and other learning resources, and to
interview school administrators, faculty, and students.
   (c) The approval to operate shall be issued to the owners or the
governing body of the applicant institution, and shall be
nontransferrable.  Any person that makes a proper application and
complies with this chapter and each standard and regulation
pertaining to this chapter shall be qualified to receive an approval
to operate or an approval of the transfer of ownership.
94836.  (a) If there is reasonable cause to believe that there has
been a violation by a private postsecondary educational institution
of the standards prescribed by this chapter, the council shall
conduct an investigation of the institution.
   (b) Within a reasonable time after the commencement of the
investigation required in subdivision (a), the council shall conclude
its investigation and take action against the institution involved,
as appropriate.
94838.  (a) No note, other instrument of indebtedness, or contract
relating to payment for educational services shall be enforceable by
any institution within or outside this state governed by this chapter
unless at the time of execution of that note, other instrument of
indebtedness, or contract, the institution has a valid approval to
operate pursuant to this chapter.
   (b) No note, other instrument of indebtedness, or contract
relating to payment for educational services shall be enforceable by
any institution within or outside this state governed by this chapter
unless the agent, who enrolled persons to whom educational services
were to be rendered or to whom degrees or diplomas were to be granted
pursuant to this chapter, held a valid agent's permit at the time of
execution of the note, other instrument of indebtedness, or
contract.
   (c) Any school or institution governed by this chapter extending
credit or lending money to any person for tuition, fees, or any
charges whatever for educational services to be rendered or furnished
shall cause any note, instrument, or other evidence of indebtedness
taken in connection with that loan or extension of that credit to be
conspicuously marked on the face thereof with the following notice:
      "NOTICE
    ANY HOLDER OF THIS CONSUMER CREDIT CONTRACT IS SUBJECT TO ALL
CLAIMS AND DEFENSES THAT THE DEBTOR COULD ASSERT AGAINST THE SELLER
OF GOODS OR SERVICES OBTAINED PURSUANT HERETO OR WITH THE PROCEEDS
HEREOF, RECOVERY HEREUNDER BY THE DEBTOR SHALL NOT EXCEED AMOUNTS
PAID BY THE DEBTOR HEREUNDER."
   In the event the school or institution fails to do so, it shall be
liable for any damage or loss suffered or incurred by any subsequent
assignee, transferee, or holder of that evidence of indebtedness on
account of the absence of that notification.
   (d) Notwithstanding the presence or absence of that notification
and notwithstanding any agreement in which the student waives the
right to assert any claim or defense, the school or institution
making that loan or extending that credit and the transferee,
assignee, or holder of that evidence of indebtedness, shall be
subject to all defenses and claims that could be asserted against the
school or institution that was to render or furnish those
educational services by any party to that evidence of indebtedness or
by the person to whom these educational services were to be rendered
or furnished up to the amount remaining to be paid thereon.
   (e) Institutions that participate in federal student assistance
programs and that comply with the financial disclosure and
notification requirements for those programs shall be deemed to be in
compliance with the standards prescribed by this section.
94840.  At least 90 days prior to the expiration of an approval to
operate, the institution shall complete and file with the bureau an
application form for renewal of its approval to operate.  The renewal
application need only contain a description of any changes made by
the institution since the time its last application was reviewed by
the council.  Fees for processing the renewal application shall be
based on the number and types of changes it contains.  The renewal
application may be reviewed and acted upon as provided in Sections
94802, 94804, and 94835, and Section 94900 or 94915, whichever is
applicable.
94841.  Before any institution may be considered for approval or
renewal of approval to operate, the institution, at a minimum, shall
pay all annual fees, assessments to the Student Tuition Recovery
Fund, orders for costs and expenses under Section 94935, and
penalties in arrears retroactive to January 1, 1990.  If an
institution that has failed to make timely payments of fees and
assessments is approved, the approval shall be conditional, subject
to any restrictions the council deems appropriate, and shall be valid
for a period not to exceed two years.
94842.  If a review and decision on a renewal application submitted
pursuant to Section 94840 cannot be completed by the council prior to
the expiration of the institution's current pending approval, that
expiration date shall be extended until the date that the council
notifies the institution of its decision.
94846.  (a) If a shift in control or change of ownership of an
institution occurs, an application for a new approval to operate for
the institution under the changed ownership or control shall be filed
with the council at least 20 days prior to the shift in control or
change in ownership.  Whenever an institution is operated at
different locations, an application for approval shall be filed for
each location.
   (b) The application for approval to operate submitted in
conjunction with a change of ownership may include pertinent portions
of the institution's previous application prepared in connection
with programs or courses of instruction that remain unchanged or
unaffected by the change in ownership.
   (c) No application for ownership or transfer of ownership shall be
approved for any applicant that has been found previously in any
judicial or administrative proceeding to have violated this chapter,
or if there exists any of the grounds for denial set forth in Section
480 of the Business and Professions Code.
   (d) No change in ownership of the institution shall be made until
the application is approved.  If an application for a new approval to
operate is not timely filed as required by this section, the
institution's approval to operate shall terminate.  Upon approval of
a change in ownership, the council shall give written notice to the
Student Aid Commission.
   (e) For the purposes of this section, a change in ownership occurs
when there is a change of control of the institution, or where a
person that previously did not own at least 25 percent of the stock
or controlling interest of an institution or its parent corporation,
acquires ownership of at least 25 percent of the stock of the
institution or its parent corporation, or when a for-profit business
converts to nonprofit corporation status or forms a nonprofit
corporation as a subsidiary to provide the educational services for
which the for-profit business is approved to operate.
94848.  An institution may not claim an exception  pursuant to
Section 94739 or 94785 if the bureau finds, after notice and hearing
as provided in Section 94975, that the institution adopted a form of
organization or method of operation for the purpose of avoiding any
provision of this chapter.