Lambda School fined $75k by CA for operating without state approval [pdf]

It’s true. Our counsel informed us that we didn’t need to register. Counsel was wrong. Now we have new counsel :)<p>We’ve submitted all the paperwork and have worked closely with California. This all happened a long time ago.<p>I’m not sure what the right level of regulation is (it’s hard taking care of 50 states at once - one state registration was 2,277 pages and weighed 25 pounds <a href="https:&#x2F;&#x2F;twitter.com&#x2F;austen&#x2F;status&#x2F;1153450365712388096?s=21" rel="nofollow">https:&#x2F;&#x2F;twitter.com&#x2F;austen&#x2F;status&#x2F;1153450365712388096?s=21</a>), but it’s reasonable that it would be regulated somehow.

Doesn&#x27;t shock me one bit. I worked for General Assembly ~5 years ago, and they were really serious about getting and staying on top of all the state guidelines. I got the sense that we were the only school taking that seriously at the time. The only thing that shocks me is that we haven&#x27;t seen such earlier.<p>I don&#x27;t have a strong opinion about if such things should be regulated or not, but I do know that there&#x27;s a lot of people who have just slapped together programs to ride a money wave, and offer relatively little in exchange and it&#x27;s hard to vet the places by yourself.

This isn&#x27;t the first time that the CA regulator (BPPE) has surprised code schools with cease-and-desist letters :)<p>That said, we (App Academy) found that the BPPE was a mostly accommodating regulator that worked with us to come into compliance. We did face a couple challenges that will likely still exist today:<p>1) BPPE won&#x27;t give approval to operate until the whole application process is completed. This means that Lambda School is likely operating without approval and will continue to do so for 6-12 months at a minimum. Contracts are unenforceable during this period, the school could be forced to shut down CA operations overnight, etc.<p>2) BPPE doesn&#x27;t have a formal policy for Income Share Agreements (ISAs). We were able to get our ISA approved in 2015, but it took some doing and was not nearly as straightforward as getting a normal tuition contract approved. Several other ISA programs that applied a year or two after us were not approved.<p>More info: <a href="https:&#x2F;&#x2F;venturebeat.com&#x2F;2014&#x2F;01&#x2F;30&#x2F;california-bootcamp-will-work-with-regulator-whatever-the-cost-its-worth-it-to-satisfy-the-state-interview&#x2F;" rel="nofollow">https:&#x2F;&#x2F;venturebeat.com&#x2F;2014&#x2F;01&#x2F;30&#x2F;california-bootcamp-will-...</a>

After reading this thread and considering it, the regulations seem fine, but lack of consistency between states seems to be a large pain-pont.<p>I realize California isn&#x27;t just &quot;any&quot; state but needing to seek unique approval from up to all 50 states just to run an online school seems like a really high (and expensive) bar.<p>It would be nice if more states cooperated on things like this. Then you seek approval from the collective, rather than at an individual level.

And this is why we need more regulations on the &quot;Bootcamp&quot; industry: <a href="https:&#x2F;&#x2F;twitter.com&#x2F;KeziyahL&#x2F;status&#x2F;1155154616281178114" rel="nofollow">https:&#x2F;&#x2F;twitter.com&#x2F;KeziyahL&#x2F;status&#x2F;1155154616281178114</a>

Their only penalty was $75,000? Sounds like &quot;ask for forgiveness not permission&quot; worked out pretty well for them here.<p>I assume they also have to come into compliance to avoid further fines, but given that they provide a legit educational service, that shouldn&#x27;t be too hard for them.

Looking at the text of the fine, you can&#x27;t charge money to teach people things (&quot;offer education&quot; in their parlence) in a physical location without state approval.<p>Could that be any more broad? Education is often just verbal and written communication between people. Seems like a first amendment violation.

Lambda employees always do PR damage on HN. Had commented about a poor experience of mine and was told to reach out via email, no response ever. They&#x27;re all talk.

It&#x27;s not everyday where you see a typo on a numeric value in a legal document:<p><a href="https:&#x2F;&#x2F;i.imgur.com&#x2F;CKt5ZGT.png" rel="nofollow">https:&#x2F;&#x2F;i.imgur.com&#x2F;CKt5ZGT.png</a><p>(notice the $75,0000.00 - in bold, no less)

Can someone tell me what a Lambda school is? From the comments here it appears its a specific class of school. From their site it just looks like a regular online learning company.

I decided to parse what was given to them. Slightly restructured:<p>&gt; A person shall not open, conduct, or do business as a private postsecondary educational institution (a private entity with a physical presence in this state that offers – advertise, publicize, solicit, or recruit – postsecondary education to the public for an institutional charge) in this state without obtaining an approval to operate under this chapter. The institution must be approved to operate, which means approved to establish, keep, or maintain any facility or location in this state where, or from which, or through which, postsecondary education programs are provided.<p>I think the key part is the determination of their location. Their California headquarters counts as a facility through which programs are provided. The fact that the classes are fully online is unrelated. They would have to argue that their headquarters don&#x27;t have anything to do with providing postsecondary education programs.

Per the dates the fine was issued in April at the latest; why is this surfacing now?

Everyone complaining about regulation should take a read through Common Law on Wikipedia and understand how U.S. regulation ends up more additive than subtractive in many cases over the years.<p>The reason we have inordinate amounts of regulations to fill out paperwork for is because “reason” doesn’t work the same way in law as it does in practicality. What’s absurdly stupid in layman’s situations is but a part of the game of legal chess in court.<p>We could have a law that says “Use common sense and don’t be an idiot”, which makes perfect sense in theory, and without very specific precedents will debated to hell in court with how common law cases work.<p>We end up with a lot of nonsense clauses and rules and requirements due to this, but it also is how chaos is supposed to be kept in check from erupting at the seams when people use lack of specific regulation as an incentive to find ways to screw other people over.

This seems like a reasonable agreement. Pay a fine (they can afford it I think), get in compliance, everyone moves on.

These things happen when you&#x27;re just getting starting its normal we live and learn.<p>Just hoping they start a slightly more flexible cohort for people who are working and looking for the next promotion

<a href="https:&#x2F;&#x2F;twitter.com&#x2F;Austen&#x2F;status&#x2F;1153451563664343040" rel="nofollow">https:&#x2F;&#x2F;twitter.com&#x2F;Austen&#x2F;status&#x2F;1153451563664343040</a>

How is Lamda School any different from Thinkful who has been doing this for over a decade? I have a few friends interested in online bootcamps?

Reason #91836218 not to have nexus in California.

Something very similar happened to Origin Code Academy in San Diego. I believe their situation is that one of the state bodies told them they would be exempt from a certain type of tax. Once they registered and were approved, they were then asked to pay their back taxes which they of course didn&#x27;t have saved up.

Many states are light touch. California is a heavy touch state. Our hands are everywhere and all over you.

So Lambda School is considered as an educational institution. Does this mean any foreigner enrolled in it probably need a student visa? Can non-US residents take online courses while in the US without a student visa?

Our universities regularly award high priced degrees that lack the important quality of employability. Unsophisticated (18 yo) purchasers of these degrees go deeply into debt, lured by false promises.<p>So much for regulation.

@austenallred - sorry about the hiccup. Sucks to get caught on the wrong side of regulations. Thanks for being so incredibly open about it. Cheering for LS.

do MOOCs or any online course go through similar regulation?

Why does Lamda School need to be registered in California and not somewhere else?

Learned something today. I thought lambdas operate without state.

Nuts that the state has the right to block this kind of thing. What foolishness is that?

Folks get jealous of success.

Why does anyone need permission from The State to teach? Seems like a violation of the first amendment.

Feel sorry for all the suckers who pay these Lambda folks tens of thousands of dollars to learn something that can easily be self taught through the plethora of blogs, videos, e-books, etc. available online.

What is the purpose of having a law requiring approval for post-secondary education?<p>Isn&#x27;t this a trade school? Why in the world does a trade school need this kind of regulation. It just seems like most of our laws are passed in secret you don&#x27;t know you violated anything until you get hit.