Students left in lurch after Quebec private colleges, recruiting firm file for creditor protection

Not all that surprising given the financial incentives involved and the exploitation by some Indian recruiters and likely some private colleges:

Three Quebec colleges and a connected recruiting firm have filed for creditor protection, adding to the uncertainty for hundreds of international students who had already been seeking tuition refunds.

M College in Montreal, CDE College in Sherbrooke and CCSQ, which has campuses in Longueuil and Sherbrooke, all requested protection in a filing in Quebec Superior Court last Friday. The Montreal-based recruiting firm, Rising Phoenix International, also filed for protection.

They are all owned by the Mastantuono family — including Caroline, Christina, Joseph and Giuseppe Mastantuono — under the umbrella name RPI Group.

The request for creditor protection comes a little more than a year after the province suspended 10 private colleges, including M College and CDE college, for what it described as “questionable” recruitment practices for students in India.

The suspension meant the schools were temporarily prevented from accepting certain foreign-student applications. Quebec’s investigation into the 10 colleges revealed shortcomings around recruitment, commercial practices, governance and teaching conditions.

Although the suspension was lifted at the beginning of 2021, hundreds of students faced long delays in obtaining a student visa that would allow them to come to Canada.

Students from India struggle to get refunds

Students pay between $28,000 and $30,000 to attend the colleges, usually over a two-year period, according to court documents. Students from India represent 95 per cent of the 1,177 students at the three colleges.

In December, CBC News reported dozens of students in India had been trying to get their tuition refunded for months after their student visas had been delayed.

Several said their parents had saved for years so they could study abroad. Without a refund, some students said they are unable to apply to other colleges, meaning their academic progress is effectively frozen. Others had to take out loans or work part-time jobs.

According to the application for creditor protection, unpaid tuition fees and refund claims from 633 students against the RPI Group are estimated at nearly $6.4 million.

The document adds that there are “potential additional claims of approximately $5 million from pipeline students awaiting a decision on their student visa application.”

In its application, RPI Group blamed its financial troubles on “a cascade of unfortunate events,” including “the impact of the COVID-19 pandemic, untimely and improperly financed expansions, changes to the immigration process for international students, as well as the litigation and public relations issues faced by the group.”

RPI Group’s decision to purchase CDE and CCSQ colleges in June 2020 for $10.9 million also left it vulnerable after subsequent visa delays led students to ask for refunds, the application said.

‘No refunds can be processed at this time’

The application for creditor protection says the colleges are committed to ensuring “the best possible outcomes for all stakeholders, including students and other creditors.”

But a letter to students at CDE College from Joseph Mastantuono, the president of the school, suggests it will be difficult for them to get a refund.

According to the letter, which CBC News has obtained, there is a plan being developed for students close to graduation to help them complete their program.

Other students will have their academic training temporarily suspended to see if a potential buyer for the colleges can be found. Failing that, the students will have to transfer to other colleges.

The letter tells students that it is “within your right to withdraw from your college” but because of its creditor protection filing, “no refunds of tuition can be processed at this time.”

The Mastantuono family is involved in another legal matter involving international students.

In November 2020, investigators with the province’s anti-corruption unit arrested Caroline Mastantuono and her daughter, Christina, for allegedly committing fraud to facilitate the processing of student permit applications while working at the Lester B. Pearson School Board between 2014 and 2016.

Although the allegations occurred before RPI was created, the negative publicity led to creditors backing out or refusing to work with them.

Caroline and Christina Mastantuono deny any wrongdoing and have contested the charges against them. The case is still before the courts.

Source: Students left in lurch after Quebec private colleges, recruiting firm file for creditor protection

‘Half-baked’ Bill 27 won’t protect migrant workers from exploitative recruiters, say advocates

Valid criticism of low level fines and other issues related to recruiting agencies:

Ontario’s proposed changes to employment law would not protect vulnerable migrant workers from unscrupulous recruiters and employers, and need more teeth to work for the workers, say advocates.

Professional recruiters play a key role in the transnational recruitment of migrant workers for employment in Ontario’s agricultural sector, fisheries, food supply, transportation, tourism, as well as in-home personal care and support services.

Last month, Labour Minister Monte McNaughton introduced Bill 27. The omnibus legislation includes policy changes meant to remove barriers for immigrants to get licensed in a regulated profession; require temporary help agencies to be licensed; and compel businesses to let delivery drivers use their washrooms, among other things.

Dubbed the Working for Workers Act, the bill, currently under review by a provincial standing committee, would also require recruiters to be licensed in a public registry and be responsible for repaying workers any illegal fees charged here or abroad.

The consequence of non-compliance for the recruiter would be the revocation of their licence and a possible fine under $300 for a first offence, critics point out.

Although employers would be required to use licensed recruiters, they would only face a fine of $250 for using someone who’s not registered.

Advocates for migrants have been calling for the licensing of recruiters and recruitment agencies since 2008, but said the enforcement tools in the proposed legislation are inadequate because the fines for infractions are way too low to be deterrents.

Recruiters, agencies and consultants use the promise of jobs that don’t exist and work conditions that don’t exist to lure workers to come to Canada,” said Syed Hussan, executive director of the Migrant Workers’ Alliance for Change. “Once they’re here, they’re so indebted they’re unable to protect themselves and defend themselves.

“This has been a well-documented issue. Now, the rest of the country has moved forward. Ontario has frankly not created any effective legislation to protect migrant workers from exploitative recruiters. As the bill stands, this will simply be window dressing, half-baked.”

According to Hussan, six provinces — Alberta, Quebec, British Columbia, Saskatchewan, Manitoba and Nova Scotia — have already adopted mandatory licensing programs, requiring a security deposit between $5,000 and $25,000 from recruiters; most also have a registry for employers who hire migrant workers. Fines for employers for using an unlicensed recruiter can go up to $50,000 in Manitoba. A registry would enable proactive inspections.

Deena Ladd of the Workers’ Action Centre said Ontario must follow the other jurisdictions to hold employers equally responsible to make sure they use recruiters that do not charge illegal fees.

“This would not compel an employer to use a licensed recruiter if all you are required is a $250 fine,” she said. “It’s really the employers who use the recruitment agencies in the first place that drive this whole business model. It is their demand for migrant workers that creates a supply chain.

“We need to make sure employers are jointly and severally liable so they’re responsible when they use these recruitment agencies.”

Advocates are asking for a minimum fine of $15,000 against employers who fail to use a licensed agency, as well as a security bond of no less than $25,000 against licensed recruiters.

Ladd said a mandatory registry of employers who hire migrant workers is crucial.

“In our experience, we see employers who violate employment standards and continue to hire workers, only to repeat the violations, such as unpaid hours of work, overtime and illegal deductions,” said Ladd.

“Mandatory employer registration would enable the Ministry of Labour to conduct effective, targeted, proactive inspections as it will have all the information they need to do so.”

Also under this bill, Hussan said the onus is on the migrant workers to prove they have paid a recruitment fee or have been exploited. But recruiters have become so savvy that they now leave little paper trail.

“We need to reverse the onus so that workers don’t have to prove that they are being charged illegal fees, but employers and recruiters must prove that the charging doesn’t happen,” he said.

Source: ‘Half-baked’ Bill 27 won’t protect migrant workers from exploitative recruiters, say advocates