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Chapter 2. Applications. Article 1. Application for Approval to Operate and Offer Educational Programs for Non-Accredited Institutions. Institution Ownership and Control; Violations of Law.   

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(a)(1) The institution shall identify the name, address, email address, and telephone number of each person, as defined in section 94855 of the Code, who owns or controls 25% or more of the stock or an interest in the institution and, to the extent applicable, each general partner, officer, corporate director, member of the board of directors and any other person who exercises substantial control over the institution's management or policies. For the purpose of this paragraph, a person exercises "substantial control over the institution's management or policies" if the person has the authority to cause the institution to expend money or incur debt in the amount of five thousand dollars ($5,000) or more in any year.

(2) For each address required, the institution shall provide a physical home address, and may request that the address, email address, and telephone number, of each person described in paragraph (1) be maintained as personal information.

(b) The institution shall describe the nature and percentage of the ownership interest and any other financial involvement in the institution of any person identified in subdivision (a) of this section.

(c) The institution shall provide a statement from any person identified in subdivision (a) of this section who -

(1) Was found in any judicial or administrative proceeding to have violated the Act or the law of any other state related to untrue or misleading advertising, the solicitation of prospective students for enrollment in an educational service, or the operation of a postsecondary school;

(2) Was denied any type of license on grounds set forth in Section 480 of the Business and Professions Code;

(3) Was adjudicated as responsible for the closure of an institution in which there were unpaid liabilities to the state or federal government or any uncompensated pecuniary losses suffered by students;

(4) Has stipulated to a judgment or administrative order or entered a consent decree involving any of the matters described in this section.

(5) Was convicted of any misdemeanor or felony as provided in Section 480(a)(1) of the Business and Professions Code;

(d) The institution shall furnish an explanation of any legal action pending against the institution or ownership or any of the institution's owners, officers, corporate directors, administrators, or instructors by any federal, state, or local law enforcement agency involving alleged acts of fraud, dishonesty, financial mismanagement, unpaid liabilities to any governmental agency or claims for pecuniary loss suffered by any student.

Authority cited:

Education Code 94803

Education Code 94877

Education Code 94888


Education Code 94885

Education Code 94887

Education Code 94888

Business and Professions Code 30

Business and Professions Code 480

(Amended by Register 2010, No. 47.)