(Reuters) - For-profit education company Bridgepoint Education Inc BPI.N said the U.S. Department of Justice was investigating the compensation of its admissions personnel, sending its shares down as much as 13 percent after the bell.
Bridgepoint said in a regulatory filing with the U.S. Securities and Exchange Commission that it was evaluating the letter it received on October 10, but declined to comment further on the matter. (r.reuters.com/raz33t)
“In its letter, the Justice Department indicated that it is considering a formal process to obtain evidence as part of its investigation,” the company said.
The affiliation of Bridgepoint’s Ashford University with the Higher Learning Commission has been under scrutiny since the Western Association of Schools and Colleges said in July that the college spends more money on recruiting students than on teaching them.
Bridgepoint cut 450 jobs and reassigned 400 employees dealing solely with admissions at Ashford last month.
The company’s shares, which have lost more than half their value this year to Monday’s close, were trading down 9 percent at $10 after the bell. They closed at $10.97 on the New York Stock Exchange on Monday.
Reporting by Sagarika Jaisinghani in Bangalore; Editing by Roshni Menon