Collège de Paris Faces Safeguard Procedure Amidst Fraud Allegations
The Collège de Paris, one of France’s largest private education groups, has been placed under safeguard procedure – the first step before potential judicial recovery – due to mounting debt and allegations of fraud. The group, which boasts nearly 18,000 students and 35,000 adults in training as of the 2023-2024 academic year, is grappling with a 90 million euro debt, with repayments doubling between 2022 and 2024.
Investigations and Allegations
The financial difficulties are compounded by investigations launched in May 2024 by the General Inspectorate of Finance (IGF), the General Inspectorate of Social Affairs (Igas), and the General Inspectorate of Higher Education (IGESR). These investigations focus on practices at Ascencia Business School and Digital College, and have reportedly led to the activation of Article 40 of the French Code of Criminal Procedure, referring the file to the public prosecutor.
Allegations include corrupted accounting, training fraud, money laundering, misuse of corporate assets, personal enrichment, and an organized system of facilitating illegal entry for foreign students. Reports suggest that some schools allegedly charged tuition fees to international students who never attended courses, exploiting the student visa process. One source close to the matter described the Collège de Paris as “to higher education what the Orpea scandal was to nursing homes.”
A History of Growth and Expansion
Founded in 2011 by brothers Olivier and Nicolas de Lagarde, the Collège de Paris grew rapidly through acquisitions, encompassing schools specializing in business, environment, luxury, communication, and digital technologies. The group’s expansion included the launch of Metaverse College in 2022, dedicated to blockchain, cryptocurrencies, and “meta heritage.”
Bpifrance, the French state-backed investment bank, has been involved with the Collège de Paris since 2022, acquiring a 25% stake alongside the Raise investment fund.
Concerns Over Oversight and Regulation
The crisis has raised questions about the lack of oversight and insufficient regulation within the private higher education sector. A former school director, speaking anonymously, described a lack of clear hierarchical structure, cross-functional supervision, and administrative irregularities, calling it a “systemic problem.”
One former student from the Lybre school in Béthune reported the abrupt closure of the institution following the company’s legal liquidation, disrupting their studies. Concerns were also raised about the quality of teaching and transparency regarding the value of diplomas.
Recent Developments and Future Outlook
Last year, reports surfaced alleging that Ridouan Abagri, founder of Digital College, used company funds for personal expenses, including a wedding and Pokémon card collection. Abagri has since moved on but remains active in education, partnering with Youssef Koutari to create Elite Society, a network of “schools of excellence.”
Legal decisions are expected in April 2024, potentially leading to the closure of some establishments. A crisis unit has been established involving the Ministries of Labor, Higher Education, and National Education to assist students affected by the situation.
The Collège de Paris reported 20 million euros in turnover in 2024, alongside 1.2 million euros in losses.