It became apparent about three years ago that Charlotte School of Law had a dilemma. The for-profit school that opened in 2006 had admitted too many unqualified students. Many failed out and others who graduated couldn't pass the bar. That bar passage rate is an important way to recruit new students and one of the reasons it came under scrutiny by its accreditor the American Bar Association. So Charlotte School of Law leaders came up with a creative solution.
Pay students not to take the bar.
Third year Charlotte School of Law student Margaret Kocaj got an email from the school about this time last year.
"That's when I first heard that the school was offering people grant money to extend their studies, so that they may have a better chance of passing the bar," says Kocaj.
In other words, delay taking the bar exam. She wasn't interested and deleted it right away.
"But I do have friends that lingered on and thought about it," says Kocaj.
Those who took the school's offer were paid. We can't confirm how much in 2014, when it appears the program started. But an email two years ago, listed the payment at $11,200.
"It comes across as, 'Hey, we really want you to pass the bar. If you need to take extra time, then we'll help you stay afloat while you're doing that and pay for extra bar passage,'" explains Kocaj. "It's certainly a rigorous plan of study. They're not just giving you money. However, in hindsight, it looks like it's done to manipulate bar passage numbers."
ADMISSION STANDARDS SLIDE
In 2014, only 58 percent of Charlotte School of Law graduates passed the bar on their first try. That was the lowest rate in the state and the ABA was pressuring the school to raise it. But the odds of that didn't look good, since the school had lowered its admission standards so much.
That year it was easily the largest law school in the state with about 1,400 students and charged tuition of $41,348.
"I mean this was a constant issue that the faculty was raising with the administration. Constant," emphasizes Brian Clark, who taught at Charlotte School of Law for five years.
By 2013, he says it was clear the school was accepting students who didn't have a chance.
"The final exam, the performance was just so bad. I gave more failing grades in that single section than I ever had in every other section that I had ever taught combined. And I was just stunned," Clarke remembers.
By the end of the 2015-16 academic year, 37 percent of that year's entering class had dropped out for academic reasons. That was the highest percentage of any law school in the country, according to the U.S. Department of Education.
"That was part of my personal tipping point, when we had heard for a year, 'We hear you. We hear you. We're working on it. We're working on it. We're working on it.' And then for nothing really to change that much," says Clarke.
BAR PREP, BAR PREP, BAR PREP
But some things did change, like the curriculum. Additional mandatory bar classes became part of the course of study. Clarke was on the school's curriculum committee. He says faculty pushed back. After all, most law schools leave bar passage to students. But Law School Dean Jay Conison made it clear in 2015 what was going to happen.
"'Look, we are doing this. Approve it.' In a tone that I had never heard him use before. And at that point it was sort-of like...faculty governance, not so much," remembers Clarke.
By the fall of 2015, the school was taking fewer applicants, but ABA postings show the LSAT scores for incoming students were among the nation's lowest. A third of the faculty ended up taking voluntary buyouts.
THE PAYMENT PLAN
As for that $11,200 payment, here's how that worked:
Shortly before the February 2015 bar, then-professor Andrew McAdams laid out what he called the living stipend:
"A lump sum, one-time, stipend (not a loan) in the amount of $7,200." Participants could receive an additional $400 for every two weeks they meet the "part-time study requirement." That made for a total of, $11,200.
The next Path to Success session offered in July of 2015 had a different payment plan. A participation agreement mentions a one-time payment of $5,000. Participants had to pay $3,195 of that back as payment for the extended bar prep, but they also got an additional stipend. The agreement doesn't say how much.
Current students, including third year Matt Blevins, say the school continued to offer some form of the program. He heard the real Path to Success push came in the weeks following graduation.
"They were very aggressively influenced and pursued and pushed to defer taking the bar they were supposed to take and pushing it off to a later date," says Blevins.
A Charlotte School of Law spokeswoman wouldn't answer questions about the program or the school's situation, so it's not clear how many graduates went through it or if they eventually passed the bar.
Kyle McEntee, the director of the watchdog group Law School Transparency, says the bar deferral program is unethical.
"Charlotte School of Law knew that its students were not equipped to pass the bar exam and had to design these deferral programs to limit or delay the damage to the school's bar passage rates, recruitment efforts, reputation, and accreditation status," says McEntee.
That didn't work. Last July, only 46 percent of Charlotte School of Law students passed the North Carolina bar on their first try. The ABA put the school on probation in November, not only citing low bar passage numbers, but problems with admissions, curriculum, and job placement. In December, the Department of Education yanked the school's federal loan money, saying the school misrepresented its rocky accreditation status.
That left several hundred students, like Margaret Kocaj, trying to make sense of their education and whether they've gone into debt for nothing.
"You're just sort-of pulling all the pieces together to get a more complete picture, which I don't think a lot of people really thought about it when it was all going on, because you don't think you're administration is misrepresenting itself or committing acts of fraud," says Kocaj.
Charlotte School of Law plans to start classes again on Monday. But the Department of Education confirmed Thursday, those students who return won't receive any federal loan money. The department said the school rejected an agreement to close and arrange for students to finish their studies at another school.