Good long but disturbing read, highlighting the complicity of governments and institutions, particularly private colleges, in such exploitation. Tighter eligibility and monitoring of DLI status for private colleges needed:
… For more than a decade, the feds have been pitching the world’s young people on a pie-in-the-sky vision of the Canadian Dream, branding the country as a land of tolerance, opportunity and first-rate education.
In 2012, the federal government declared its intention to double the number of international students to 450,000 within the next decade. The following year, the government committed to an ongoing annual expenditure of $5 million, largely to be spent on advertising and promotion: glossy promotional videos, higher-ed fairs and online marketing. In 2016 it launched the EduCanada website and brand (tagline: “A world of possibilities”), plastered with feel-good messaging about Canada’s cultural diversity and welcoming nature. And in 2019, the government announced nearly $150 million in spending over five years, including $29.5 million for targeted digital advertising alone.
These efforts have paid off enormously. The federal government estimated that in 2018, international students spent $21.6 billion on tuition, accommodation and other expenses—an economic infusion supporting 170,000 domestic jobs and exceeding the impact of major exports like lumber, auto parts and aircraft. At that point, foreign students contributed nearly 40 per cent of tuition revenues at Canadian universities. Those numbers may well be higher now; as of 2022, international student enrolments in Canada surpassed 600,000, far exceeding the government’s 2012 targets.
And well-known public institutions aren’t the only schools benefiting from the boom. As the cohort of students travelling to Canada has swelled, so has the number of small, private-sector colleges emerging to capitalize on them. Many operate out of inauspicious-looking storefronts, strip malls and office parks, where they specialize in short-term programs with clear paths to the workforce: accounting, secretarial studies, IT support, truck driving.
And their numbers are growing fast. In Quebec, those include 48 non-subsidized private colleges in 2022, up from 28 in 2015. (Non-subsidized schools are similar to for-profit career colleges found in other provinces.) The number of study permits issued to international students in the province has more than doubled from 4,900 between 2016 and 2018 to 11,500 between 2019 and 2021.
The international student explosion of the past decade has created fertile ground for shoddy schools and fraud artists. “Money drives these schools, not education,” says immigration lawyer Ho Sung Kim.
Meanwhile, education agents—like the one who recommended M College to Nisha—are funnelling students straight into these schools. According to global education organization ICEF Monitor, as many as half of international applicants to Canadian schools use recruiters. Universities and colleges pay recruiters a commission for each student, typically 10 or 15 per cent of first-year tuition, and sometimes more. (Students themselves generally don’t pay recruiters directly.) Yet the industry remains essentially unregulated, as do recruiters’ relationships with the fast-growing private college sector. According to Montreal immigration lawyer Ho Sung Kim, this is why so many business people are interested in the industry: “Money drives these schools, not education.”
Will Tao, an immigration and refugee lawyer in Vancouver with a special interest in international students, says agents and recruiters often peddle misinformation about the quality of schools. While there are respectable private colleges across Canada, he says, the international student explosion of the past decade has created fertile ground for shoddy schools and exploitative operators.
And when things go awry, students pay the price. In 2015, provincial regulators shut down Fraser Valley Community College, a private college in a strip mall in Surrey, B.C. The government had received dozens of complaints from students about misleading promotions that guaranteed jobs after graduation, plus promises of high-quality facilities the school didn’t have and tuition refunds the college allegedly refused. The government decided the institution could no longer be trusted to comply with regulations and revoked its registration.
In 2020, the Ontario Provincial Police charged owners and employees at the Royal Institute of Science and Management in Markham, Ontario—another storefront career college—with fraud, forgery and other offences. Police allege that the college recruited students to apply for a government funding program to help pay for tuition. The students then simply handed the money to the college and received a diploma without attending any classes.
But little in recent years can match the debacle that Nisha—and hundreds of other students—endured. The story of M College isn’t just about one failed school. It’s about a booming international education machine that’s commodified the hopes and dreams of young people, mostly from the Global South. It’s an industry that has been aggressively stoked by Canadian governments—which have done little to protect students when things go terribly wrong.
***
Caroline Mastantuono is a woman with a knack for both the slow burn and the big swing. In 2004, Mastantuono, then 41, was a support staffer in Montreal’s sprawling Lester B. Pearson School Board, which serves students in grade schools, high schools, adult education centres and adult vocational schools throughout the city. It’s the vocational programs—like auto mechanics, hairdressing and accounting—that are the board’s biggest money-makers, with tuition in some cases topping $18,000.
In 2004, Mastantuono—who did not respond to interview requests sent to her lawyer—received a promotion from the board, putting her in charge of a new international student department. Her mandate was to boost international admissions to those vocational and adult education programs. In 2012, she partnered with a Toronto businessman named Naveen Kolan, who ran a student recruiting company called Edu Edge Inc., which focused on students from India. The partnership soon bore fruit: between 2010 and 2016, the number of international students enrolled in the board jumped from seven to 777, supercharging the department’s revenue from $91,000 to $5.5 million.
“What happened with the students in India is a tragedy. I spoke with one girl who tried to end her life twice in January of 2022,” says Alain Tardif of the law firm McCarthy Tétrault.
Then, in the spring of 2014, Mastantuono’s daughter Christina, who worked on her staff, came to her with a problem: some students were being denied Quebec Acceptance Certificates because they didn’t have enough money to cover tuition. In June, Mastantuono and Kolan allegedly gathered the department’s staff and laid out a creative solution: they would create false receipts of tuition payment. The false receipts were kept secret from students and submitted to the provincial government. Edu Edge then billed the board a recruiter’s fee for 81 forged chits, representing a total of $1.65 million in tuition.
Soon, another alleged scheme came to light. Two staffers in the department began noticing that a numbered company in British Columbia was being credited for recruiting students who the employees knew had applied independently. The pair started digging and found that the company was registered to Kolan’s wife. In total, 25 students were falsely linked to the B.C. firm, which received $119,000 in fees from the school board between 2014 and 2016.
By then, the board’s finance department, as well as its chair and its assistant director, were asking questions. An internal investigation, which concluded in 2016, found that Mastantuono “lacked transparency” in regards to her department’s activities and its financial arrangement with Edu Edge. She and her daughter were both fired, and the minister of education and higher education ordered an audit of the board’s international program. That December, the Quebec government’s anti-corruption squad launched a parallel investigation that found evidence of fraud, fabrications, use of forged documents and abuse of power at the Pearson board. The investigation was code-named “Projet Pandore.”
For the Mastantuonos, this was just a temporary setback. By March of 2017, Caroline had leveraged her knowledge of the international student market to launch a new recruiting firm: Rising Phoenix International, or RPI. She hired her son, Joseph, along with Christina. The new RPI team travelled to China, the Philippines and Mexico on recruitment trips and signed deals with private and public colleges in Quebec, Ontario, B.C. and New Brunswick. In 2018, as president and CEO of RPI, Caroline took part in the Canada-India Business Forum in Mumbaias a member of the Canadian delegation, a trip that included photo ops with Justin Trudeau, Sophie Grégoire Trudeau and celebrity chef Vikram Vij.
By 2020, the Mastantuonos had also taken over operations of three private colleges. There was M College, Nisha’s would-be alma mater, which the family itself founded. It was licensed by Quebec’s Ministry of Education and Higher Education in 2019. The family purchased two other schools: CCSQ, with one campus in the Montreal suburb of Longueuil and another in Sherbrooke. And there was CDE College, also in Sherbrooke. RPI had already served as the schools’ recruiters, drawing the vast majority of students from abroad, almost exclusively from India. There were well over 1,000 students at the colleges, and only six were Canadian. Joseph Mastantuono was named president of all three schools.
***
In January of 2020, Ravneet Kaur Mand stepped off a city bus on Curé-Poirier Boulevard West in Longueuil, on the south shore of the St. Lawrence River, across from Montreal. It was her first day of classes at CCSQ—and immediately, she was confused. The neighbourhood was mostly residential, and the building at the college’s address looked like a plain three-storey walk-up. My apartment building is bigger than this, she thought. Ravneet checked Google Maps on her phone again.
It was no mistake. She made her way inside, which was just as dispiriting. With the exception of a cafeteria in the basement, there was nothing more to the school than bathrooms and a few classrooms with desks, chairs and laptops. Her family was paying $30,000 for her to attend the college’s two-year medical office specialist program, which Ravneet found through a recruiter in her small hometown in Punjab. Once she saw what the college had to offer—an unresponsive administration, mediocre facilities and an educational experience generally unworthy of her steep tuition—she became convinced that her recruiter was financially incentivized to get her to enrol by exaggerating its prestige and the quality of its facilities.
Each year, Quebec’s advisory commission on private education releases a report that evaluates conditions at private colleges across the province. According to its 2020–21 report, only three of the 14 teachers at CCSQ in Longueuil were technically qualified to teach, and turnover was extremely high—the average level of seniority was one year. At CCSQ in Sherbrooke, only one teacher was qualified. Both colleges were warned to stop overcharging for tuition or other services. A provincial inspection at CDE in 2021, meanwhile, revealed that several classrooms were overcrowded. By most accounts, CCSQ’s sister school, M College—the one Nisha virtually attended—wasn’t much better. Located on a busy thoroughfare in the borough of LaSalle in Montreal, it was housed in a nondescript office building nestled among a rotisserie chicken joint, a mattress store and a pair of car dealerships.
Even as students like Ravneet and Nisha were plowing through their underwhelming studies at the RPI schools, the alleged schemes and frauds at the Pearson board were about to come roaring back for the Mastantuonos. After nearly four years of digging, the Projet Pandore investigators concluded their work. In late November of 2020, Caroline and Christina Mastantuono were arrested and charged with fraud. The pair stepped aside from their RPI roles and pleaded not guilty. (Kolan, who’d seemingly vanished, turned himself in two months later. He also faces fraud charges and has pleaded not guilty, and did not respond to a request for comment sent to his lawyer.) That was just the beginning of what would turn out to be a very bad 12 months for the family—though most RPI students were completely unaware of the mounting troubles.
When Caroline and Christina were arrested, RPI was still expecting $10.6 million in financing from TD and the Business Development Bank of Canada to cover the purchases of CDE and CCSQ. After the arrest, the financing was cancelled. Then, during the first two weeks of 2021, the province’s Ministry of Education and Higher Education stopped processing study permit applications from M College and CDE (along with eight other Quebec colleges, unrelated to RPI) while it investigated questionable recruitment practices, among other problems. In retrospect, the family appears to have been aware of a looming financial reckoning: in March of 2021, Caroline Mastantuono gifted a lakefront house she owned in the Laurentians, valued at $750,000, to a family trust—a move that protected it from creditors.
In November of 2021, Caroline came back aboard as RPI president. At the end of that month, students received emails insisting that they had to pay their fees by early December—not January, as they’d previously been told.
Ravneet, who’d already paid her tuition, watched as stressed-out classmates and friends scrambled to secure funds and navigate bank limits on transfers. “I still don’t know how they managed,” she says. The students were perplexed by the colleges’ sudden need for immediate tuition payments.
Things became clear in early January of 2022, when Joseph Mastantuono, president of the colleges, emailed students to inform them that they had filed for creditor protection. (CDE and M College filed the previous day.) He blamed the financial troubles squarely on the pandemic: the cost of delivering new laptops to students abroad, getting the campuses COVID-safe and a drop in enrolment due to travel delays. He said the college would work with a court-appointed monitor, which would oversee the finances. Students close to graduating would continue. Everyone else would be on “extended pause.”
***
After 10 months of studying day and night, sometimes 12 hours straight, Nisha wrapped up her final exam in August of 2021 at home in India. All that was left was to get her study permit, still only approved in principle, and travel to Canada to complete an internship.
Only moments after finishing the exam, an email popped into her inbox from Immigration, Refugees and Citizenship Canada. Her heart sank: her permit had been rejected. The agent who reviewed her application wasn’t satisfied that she’d leave Canada at the end of her stay and didn’t think that the proposed studies—now nearly completed—were consistent with her previous education and qualifications.
Nisha was beyond confused. Neither of these problems were raised in the first stage of the process, when she received her approval in principle. How could the same country that accepted her, and took her money, refuse her almost a year later?
Her first priority was to get a refund from M College, which had previously told students that even in the event of a study permit rejection, they could get their money back, minus administrative fees. Through the summer and fall, the college put her off, citing COVID-related processing delays. When RPI applied for creditor protection, she finally realized that her money was gone for good unless the schools could find a new buyer willing to refund her.
More than 500 other students in India were in a similar situation: their tuition was paid but their study permits or visas had been rejected. About 125 of those had received an approval in principle for their study permit, just like Nisha, and had been studying online for more than a year, with every expectation that their permits would be approved.
Hundreds more were still waiting on their paperwork, or were already studying in Canada, only to find those studies indefinitely paused. All told, approximately 2,000 current or prospective students were affected. Panicked and angry, the RPI students organized protests in Canada and India to raise awareness. They wrote to MPs across the country, especially those with Punjabi backgrounds, like Jagmeet Singh, MP Anju Dhillon from LaSalle, and MP Sukh Dhaliwal from Surrey, B.C.
In February of 2022, they met with the law firm McCarthy Tétrault, which the court had appointed to represent them in the insolvency proceedings. The lawyers’ goal: to ensure affected students got their study permits or visas extended or approved, or received a refund of their fees.
McCarthy Tétrault reached out to the federal government. When no answer came by mid-March, the firm petitioned the Superior Court of Quebec to extend the students’ Quebec Acceptance Certificates and study permits and reconsider student visas for students still in India who had been rejected. The application was dismissed in mid-April; the judge ruled that he couldn’t compel the provincial and federal governments to do what McCarthy Tétrault was asking. Instead, the firm would need to apply to the federal court. According to Alain N. Tardif, a partner at McCarthy Tétrault, that’s a much more complex and expensive undertaking.
To Tardif, Nisha’s case was among the most critical of all. The government had granted her permission to study, only to snatch it away after she’d paid tuition and almost entirely finished her studies. She and her family stood on the precipice of financial catastrophe due to the failure of the RPI schools. According to the McCarthy Tétrault team, the federal and provincial governments were partly responsible for the financial fallout.
“What happened with the students in India is a tragedy,” says Tardif. “I spoke with one girl who tried to end her life twice in January of 2022. Victims of fraud always believe that it’s their fault, but there’s nothing they could have done. The federal government told them to pay those fees in advance. The students keep telling us to get a court order so they can be reimbursed, but what they don’t understand is the money is gone.”
The province’s responsibility—and its culpability—began long before students even paid their fees, adds Tardif. Quebec’s Ministry of Education and Higher Education signs off on which colleges become designated learning institutions, which are approved to enrol international students. The ministry signed off on CCSQ and CDE after the Mastantuonos acquired them—despite a 2020–21 report by Quebec’s advisory commission on private education that flagged financial problems, such as the family’s inability to demonstrate that the colleges had sufficient funds for adequate operations.
But there was another clear red flag the government overlooked, adds Tardif. If one of the permit holders or directors has a judicial record that demonstrates issues that could impede their ability to run an educational institution, he says, the ministry can revoke their permit. That didn’t happen after Caroline and Christina Mastantuono were charged with fraud.
“The first shortcoming is the Quebec government allowing these colleges on that list,” he says. “They had warning that there were issues with the ownership, there were issues with insolvency. Those colleges should not have been on that list.”
***
Today, Ravneet lives with three roommates in Montreal’s Côte-des-Neiges neighbourhood. After struggling to land the internship she needed to complete her program, she found a placement as a technician at a pharmacy. She’s now been approved for a post-graduation work permit, allowing her to stay in Canada for the time being.
Despite everything, she doesn’t have a problem with recruitment agents in general. “Recruiters translate all this English information into Hindi and Punjabi, which is especially helpful for the parents, who often aren’t very educated,” she says. But she does have a problem with agents getting big commissions for pushing certain schools, and students paying the price.
Manitoba is the only province to regulate recruiters. In 2016, it introduced legislation requiring schools to properly train recruiters and review the information they provide to students. It outlines ethical standards for recruiters and requires schools to terminate partnerships with recruiters when those standards are breached. In 2017, the provincial audit on the Mastantuono situation made 15 recommendations to improve the way international student programs conduct business, including accrediting recruiters. No action was taken. Then, last February, the House of Commons Standing Committee on Citizenship and Immigration made a similar recommendation, suggesting that Immigration, Refugees and Citizenship Canada introduce new regulations to govern recruiters, working with provinces, territories and schools to enforce ethical behaviour.
Last June, CDE, CCSQ and M College were transferred to the privately owned Cestar College of Business, Health and Technology. Cestar has operated in Ontario since 2007 without incident, and the acquisition allowed enrolled RPI students, like Ravneet, to finish their studies. Still, the collapse of the schools made many students skittish—about Montreal, about Canada and about private colleges.
Varun Khanna, who’s 32, moved to Canada from India in 2015 to attend a private college. Today, when he’s not busy running the small trucking company he owns, or studying mobile application development at one of Montreal’s public colleges, he volunteers with the Montreal Youth Student Organization. He co-founded the organization in response to the RPI collapse, advocating for South Asian students.
“The headlines in Punjab right now are discouraging people from applying to Canada, because they’re going to be defrauded. That’s very, very bad publicity.”
He says that he’s heard many stories of recruiters telling students they won’t be able to get into a particular well-known college or university and directing them to private institutions instead. Some may be good, but others turn out to be little more than a few floors, or a few rooms in a cheap office building, with underpaid teaching staff. The RPI colleges fit that bill. After the disaster there, he says his organization is recommending students go to public colleges and universities—“just to be safe.”
Caroline and Christina Mastantuono, and Naveen Kolan, are standing trial early this year on charges of fraud stemming from the Pearson school board case, but the outcome will have no bearing on the fate of the RPI students.
Tardif would like the federal government to contribute to a fund for them—it would be the right thing to do, as well as a small step toward rehabilitating Canada’s image abroad. “Our reputation in India is damaged by this,” he says. “The headlines in Punjab right now are discouraging people from applying to Canada because they’re going to be defrauded. That’s very, very bad publicity.”
Nisha wishes someone had given her that kind of warning. “It was my dream to come to Canada, to become something,” she says. “But it would have been better if I’d never applied.” For a while, Nisha just wanted a resolution, in the form of a refund, or entry to Canada. If the school won’t pay us back, then it is the responsibility of the Canadian government to allow us to complete our education, she would tell herself. We’re not criminals; we’re students. Even months after the Superior Court of Quebec dismissed McCarthy Tétrault’s application, she retained some hope.
Now she knows there will be no Canada and no money. Some other Indian students who’d been in similar situations have since managed to gain entry to Canada. Others have found the money to start over again in a new program, at a new school in a new country. There are few people left who truly understand everything she’s gone through.
Nisha’s family doesn’t speak of the financial strain of remortgaging the family home; they want to protect her, and they want her to forget her terrible luck. Their faith in her remains unshakable.
She’s doing her best to turn a profoundly negative experience into something positive—not just for her, but for others. She’s tutoring friends, and friends of friends, in English, on a volunteer basis. At any time, she has 10 or so students between the ages of 18 and 30, across India, taking her classes online, all people who can’t afford the cost of traditional language classes. She wants to help them improve their English and pass their language proficiency exams so they can eventually do what she couldn’t: study abroad and build a new future for themselves.
Source: How fraud artists are exploiting Canada’s international education boom
