Globe University files for bankruptcy, debts owed range from $10 to $50 million | KSTP.com

Globe University files for bankruptcy, debts owed range from $10 to $50 million

Globe University files for bankruptcy, debts owed range from $10 to $50 million Photo: KSTP

Updated: November 21, 2019 02:49 PM

The defunct for-profit Globe University has filed for Chapter 11 bankruptcy protection, saying it owes many millions of dollars in connection with fraud actions taken against the school by the state of Minnesota.

The petition filed in federal court Wednesday by the former Woodbury-based school comes two weeks after the Minnesota Supreme Court sided with former criminal justice students at Globe. Its also affiliated Minnesota School of Business (MSB) in ruling that anyone who attended the programs can receive a tuition refund.

The filing lists Globe's assets ranging from $100,000 to $500,000, with debts ranging from $10 million to $50 million, according to court documents. The state's claims are the largest by far among the creditors, but the U.S. Education Department also has a claim of roughly $850,000 in connection with student loans.

It remains unclear how the filing would impact the students' efforts to recoup their money owed.

If a judge approves Globe's petition under the provision of Chapter 11, then the debtor would propose a plan to repay its creditors over time and possibly at lowered amounts, according to the petition. 

Then-Attorney General Lori Swanson sued the schools in 2014, saying it enrolled students for criminal justice programs even though it lacked accreditation.

After campuses had closed in 2017 amid the legal battle, a court found Globe University and Minnesota School of Business violated the Consumer Fraud and Deceptive Trade Practices Act. They were ordered to pay restitution. However, the Minnesota Court of Appeals ruled only 15 students who had testified at the trial were eligible for the repayment.

The state Supreme Court said Wednesday that any of the roughly 1,330 students who attended the programs since 2009 can request reimbursement for tuition, fees and other education-related expenses, including interest. The state estimates former students are now eligible for refunds worth as much as $33.7 million.


More from KSTP:

Appeals court orders loan repayment to Globe University, Minnesota School of Business students 

Globe University, Minnesota School of Business ordered to pay restitution 

Globe, MSB in process of shutting down campuses 

Judge orders Globe University, Minnesota School of Business to stop fraudulent marketing

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