Utah Division of Consumer Protection director Francine Giani wants to put an end to stories of people who end up in tears because they paid thousands to a private school, only to see that money vanish when the school goes under.

Protecting students of proprietary postsecondary schools is also the intent of proposed legislation that was passed Wednesday out of the Business and Labor Interim Committee. The next stop for the bill is the 2005 Legislature.

"There are some huge risks out there for students," said bill sponsor Sen. Dan Eastman, R-Bountiful.

Eastman and Giani teamed up to tell legislators how the current law governing these schools needs to be amended to help reduce the risks to students.

The proposed bill authorizes Giani's office to conduct audits or "spot checks" of schools and require school officials to disclose more information about their institutions before students pay tuition.

It would also mean tighter restrictions on truth in advertising.

"We've seen a lot of students being promised $100,000 jobs in the computer field," Giani said. The reality is that those jobs, in today's market, are harder to find, she added.

If the bill passes both houses, criminal background checks could soon be required of school owners, administrators, officers, faculty and staff. Certain convictions could mean a school is denied registration by Consumer Protection.

Eastman said "naive, hopeful" people are being preyed upon by schools that collect upwards of $20,000 in advance of a student's first semester and, in some cases, the schools aren't delivering the education they promised.

"Schools should never accept $20,000 in advance — that is ridiculous," said Dave Butterfield, owner of the private New Horizons Computer Learning Centers in West Valley City. His school absorbed students when Salt Lake City-based PC Training West closed.

Butterfield and Giani talked about raising the bond amount schools put up prior to opening. That money would be used by Consumer Protection to help students recover some loss and to pay for classes elsewhere.

Giani suggested hiking the bond from $46,000 to $187,000, an amount that would vary depending upon the size of the school when it opens. At the request of the Consumer Protection Division, Butterfield's school already pays the higher amount. He even suggested a maximum bond of $250,000 for all schools.

Last month Salt Lake Valley College officials notified Giani's office that they would be closing — before they ever had a chance to open. That school, whose owners decided to turn the facility into a conference center, was bonded, but no claims have been made, Giani said Wednesday.

Thirteen students of the now defunct Advanced Technical Center in Murray weren't as lucky and they are currently out a total of $120,000. The man who was going to buy ATC is now in jail, Giani said.

Giani is now working with the Attorney General's Office to get access to $53,000 through a private bonding company that ATC used.

"Those kids are only going to get pennies on the dollar," Giani said. Once the bonding funds are released, the next step is to find a school that will take on the students.

Yet another school, which Giani declined to name, is currently experiencing financial difficulties. A $13,000 refund check written out to one student bounced on the first attempt to deposit — it has since cleared.

---

E-mail: sspeckman@desnews.com