[HN Gopher] CFPB Takes Action Against Coding Boot Camp BloomTech...
___________________________________________________________________
CFPB Takes Action Against Coding Boot Camp BloomTech and CEO Austen
Allred
Author : Jimmc414
Score : 717 points
Date : 2024-04-17 17:48 UTC (1 days ago)
(HTM) web link (www.consumerfinance.gov)
(TXT) w3m dump (www.consumerfinance.gov)
| Jimmc414 wrote:
| Announcement from CFPB Director
| https://twitter.com/chopracfpb/status/1780651320766058684
| mistrial9 wrote:
| a quick search shows this post dated 2020 (a long time ago)
|
| https://www.applieddivinitystudies.com/lambda-lies/
| taytus wrote:
| April, 17th, 2024
|
| https://www.consumerfinance.gov/about-us/newsroom/cfpb-takes...
| Twirrim wrote:
| This is the boot camp school formerly known as Lambda School,
| that came under a lot of fire in the past for these types of
| practices, and other issues.
|
| Previous trouble they've been in:
|
| https://dfpi.ca.gov/2021/04/26/lambda-school-reaches-settlem...
|
| https://techcrunch.com/2021/05/13/lambda-school-lawsuits/
| dylan604 wrote:
| This is one of those situations lending support to the
| corporate death penalty. Allowing name changes like Worldcom,
| Spectrum, and so on to write off some liabilities while
| operating as if nothing happened.
| avarun wrote:
| Their name change was unrelated to this. Somebody else owned
| a trademark for Lambda and sued them over it, so they were
| forced to change their name.
| bee_rider wrote:
| It should be impossible to own the trademark to a letter.
| pbhjpbhj wrote:
| Letters in foreign languages seem capable of enough
| distinctiveness to be registered trademarks to me, like
| Alpha Security, Delta Airlines, Kappa clothing.
|
| What's the problem you see here?
| JumpCrisscross wrote:
| > _the corporate death penalty_
|
| This is a silly idea lobbyists love because it sidesteps the
| _actual_ corporate-destruction mechanism: liquidation to pay
| massive fines, license revocation and /or personal liability
| for senior management.
|
| Consider even the penalties here, which effectively ban
| Allred and Lambda from doing business. If you corporate
| death'd them, the contracts and assets would still exist.
| Allred would be unpunished. Everything would go back to
| shareholders who were presumably fine with the _status quo_ ,
| and would be fine putting them into a new entity that Allred
| could manage. Okay, so you cancel the contracts. Now the
| janitor who hasn't been paid in two months is screwed. Okay,
| so you exempt employees. Allred's an employee! Exempt him?
| What do you even pay the janitor with? Okay, exempt some
| assets. How many? How do you choose who must keep paying
| versus who is let off? Maybe _pro rata_? Who will administer
| all this? _Et cetera, et cetera._
|
| Contrast that to a massive fine. Company goes Chapter 7 and
| into a deep body of law that has experience dealing with the
| above. (Ideally paired with a license revocation from any
| lending for Allred and the entity, in case they try to
| Chapter 11.) Shareholders are wiped and free to pursue
| Allred. Allred and Lambda are neutralised.
| tedivm wrote:
| Everyone I know who speaks about a corporate death penalty
| includes liquidation to pay pack victims. I've never heard
| someone argue for the corporate death penalty _without_
| "liquidation" and "license revocation and/or personal
| liability for senior management."
|
| The difference between this and a big fine:
|
| * Lots of big fines aren't big enough to actually kill
| companies that deserve it,
|
| * Fines tend to go to the government, while companies that
| deserve a "death penalty" often have victims who could use
| that money,
|
| * Bankruptcy doesn't prevent people from starting another
| company, or board members who failed at oversight to join
| another board.
| JumpCrisscross wrote:
| > _includes liquidation to pay pack victims_
|
| Just do damages.
|
| > _Lots of big fines aren 't big enough to actually kill
| companies that deserve it_
|
| Neither is a corporate death penalty. You're just
| shuffling around assets and making work for lawyers.
|
| > _companies that deserve a "death penalty" often have
| victims who could use that money_
|
| Why the extra steps?
|
| The closest we have to a death penalty is license
| revocation, _e.g._ Arthur Anderson [1]. Victims got
| screwed. Taking it further and the death penalty analogy
| seems appropriate--death penalties aren 't about
| restitution. They're an instrument of retribution.
|
| > _Bankruptcy doesn 't prevent people from starting
| another company, or board members who failed at oversight
| to join another board_
|
| Neither does a corporate death penalty. That's what bans
| are for.
|
| Corporate death penalty is a gift to corporate America.
| It sets activists running in circles over a stupid idea
| that represents simpler, precedents punishments with the
| ambiguous baggage of extra steps.
|
| [1] https://en.wikipedia.org/wiki/Arthur_Andersen_LLP_v._
| United_...
| dragonwriter wrote:
| > If you corporate death'd them, the contracts and assets
| would still exist. Allred would be unpunished. Everything
| would go back to shareholders who were presumably fine with
| the status quo, and would be fine putting them into a new
| entity that Allred could manage.
|
| This is wrong for a variety of reasons:
|
| (1) The corporate death penalty is proposed as an
| _additional_ remedy, not an _alternative_ remedy, to
| personal liability for officers, etc. (in fact, many
| corporate death penalty proposals would make additional
| personal penalties for corporate officers available as a
| part of that _on top of_ any that would be available
| independently of the corporate death penalty for their
| actions, e.g., in one proposal for a federal charter
| revocation law, "The statute should specify that, for a
| period of five to ten years, the directors of the condemned
| corporation could serve on the same corporate board
| together only when they are a minority, ensuring that that
| set of directors would not form a majority of the board of
| another corporation. Similarly, key senior officers should
| be prohibited from working together for five to ten years.
| In addition, no director or officer could serve on the
| board or work for any corporation affiliated with the
| parent corporation of the convicted corporation. Courts
| must be empowered to issue injunctions to enforce these
| rules, preventing reconstitution of substantially the same
| corporation under another name." [0])
|
| (2) Corporate death penalty proposals tend to include
| proposals for how dissolved corporations are to be wound
| down that address the concerns you address (like a
| bankruptcy, these would be generally be administered by
| courts, probably most normally the court issuing the
| penalty.) From the same proposal, "The dissolution of the
| corporation should impose the harshest penalty on the
| corporate entity itself, directors, and officers, while
| only damaging shareholders-who have less control over
| corporate misconduct-to the extent necessary to incentivize
| them to take an interest in the corporation's criminal
| misconduct. [...] the penalty should dissolve the
| corporation with as little impact on innocent parties-
| employees, consumers, suppliers, and the larger economy-as
| possible." [1] The proposal goes on to propose that an
| corporation subject to the corporate death penalty should
| have a court appointed "czar" take over management of its
| assets (similar, in a way, to a bankruptcy trustee),
| operating them and preparing and organizing them for sale
| (by default, by auction, but by other means where
| appropriate), with a specified distribution of the
| proceeds: "The statute should specify that revenues from
| the sale of the corporation's assets first pay court costs
| and the costs of the czar's operation during dissolution.
| Next, nonmanagement employees of the corporation that have
| clearly suffered harm due to the dissolution, such as being
| rendered unemployed, should be compensated through a one-
| time stipend. Finally, the balance should be distributed
| among the shareholders. In this way, the affairs of the
| corporation could be wrapped up in an orderly and just way
| that would protect innocent parties while only causing
| minimal harm to shareholders." [2]
|
| (3) As with personal sanctions, the corporate death penalty
| is proposed in addition to, not in replacement for,
| criminal fines and restitution, and civil damages that may
| be available. The key difference between corporate death
| penalty and bankruptcy is that the corporate death penalty
| can punish directors and officers, _and_ it de-
| institutionalizes the firm in much the same way as
| bankruptcy, but it does so _even if_ the amount of the
| monetary penalties would not render the corporation
| insolvent.
|
| [0] https://www.gwlr.org/wp-
| content/uploads/2018/04/80-Geo.-Wash..., pp. 621-622
|
| [1] id., pp. 628-629
|
| [2] id., p. 630
| teeray wrote:
| I'd go so far as to say that the officers should be
| barred from working in the same industry for a couple of
| years. Long enough that whatever edge they had is eroded
| by time. It might be extreme, but adding a "curse" aspect
| to officers' careers would act as an additional
| deterrent.
| JumpCrisscross wrote:
| > _officers should be barred from working in the same
| industry for a couple of years_
|
| "The Bureau's order permanently bans BloomTech from all
| consumer-lending activities and bans Allred from any
| student-lending activities for ten years" [1].
|
| [1] https://www.consumerfinance.gov/enforcement/actions/b
| loomtec...
| JumpCrisscross wrote:
| > _corporate death penalty is proposed as an additional
| remedy, not an alternative remedy_
|
| Corporal death penalties aren't an additional remedy--
| they're the ultimate remedy. The branding sucks.
|
| > _to personal liability for officers_
|
| Just do this. Why the extra steps?
|
| > _Corporate death penalty proposals tend to include
| proposals for how dissolved corporations are to be wound
| down that address the concerns you address_
|
| So does bankruptcy, a precedented mechanism.
|
| > _the penalty should dissolve the corporation with as
| little impact on innocent parties-employees, consumers,
| suppliers, and the larger economy-as possible_
|
| How? You're putting their employer, vendor, customer and
| taxpayer out of business. (If not, what are we talking
| about?)
|
| > _but it does so even if the amount of the monetary
| penalties would not render the corporation insolvent_
|
| Increase the fine.
|
| More pointedly: if you can't justify a fine or penalty
| more than the company is worth, maybe--on the net--they
| shouldn't be poofed?
|
| Criminal companies should take every opportunity to shift
| debate around fines, penalties, license revocation and
| personal responsibility to one about a corproate death
| penalties. You get the baggage of the corporal death
| penalty for free with a heaping spoonful of ambiguity.
| While everyone debates what common punishments this Rude
| Goldberg replaces, you can slink away. Worst case: if
| they do enact it, it's so novel and convoluted you can
| probably buy a decade of appeals before you have to give
| up the assets.
|
| Fines are money. Charters paperwork. We're currently
| seeing a charter revocation example in the Trump fraud
| trials [1]. It is by far the least meaningful part of the
| penalty. Could Trump trade the fine for the revocation,
| he would take it--anyone would.
|
| [1] https://www.businessinsider.com/trump-fraud-ruling-
| corporate...
| throwaway2037 wrote:
| > to personal liability for officers
|
| This is required now for "financial record keeping and
| reporting" thanks to Sarbanes-Oxley Act. Ref:
| https://en.wikipedia.org/wiki/Sarbanes%E2%80%93Oxley_Act
| adrr wrote:
| Or you could just toss people in jail. This case is clearly
| wire fraud if the company knowing provided fraudulent hiring
| rates to get people to pay money for a service.
| shkkmo wrote:
| Why not both?
| natpalmer1776 wrote:
| Because of diffusion of responsibility, wherein the
| person taking the fall was only one of perhaps three
| dozen individuals who collaborated to make the relevant
| business decisions.
|
| If you to set the precedent of consolidating the
| consequences and doling them out to the relevant
| executive officer you'll end up with c-suite executives
| around the country throwing their personal and corporate
| influence into getting that precedent neutralized.
| shkkmo wrote:
| How doed charging executives in addition to fining a
| company an amount that puts the card company into
| unresolvable bankruptcy lead to "diffusion of
| responsibility"?
|
| Yeah, rich CEOs and investors are opposed to taking any
| responsibility for their actions, but that doesn't we
| shouldn't try to hold them responsible.
| natpalmer1776 wrote:
| It doesn't lead to a diffusion of responsibility, the
| diffusion exists independently by nature of how a
| business operates.
|
| A CEO will green light high level strategic direction,
| but the crimes described here could easily emerge from
| the implementation of that directive at lower levels of
| the company. "Plausible deniability"
| ImPostingOnHN wrote:
| The CEO in that case would be culpable for culturing a
| culture of criminality.
|
| The buck stops at the top.
| natpalmer1776 wrote:
| I mean, I agree with the sentiment but good luck
| codifying that in a law that won't be abused to convict
| innocent people who were convenient patsies while letting
| guilty ones walk free due to the "subjective" nature.
| ImPostingOnHN wrote:
| Sarbanes Oxley already codifies corporate officer
| responsibility into law, so there's a pretty clear
| precedent.
| natpalmer1776 wrote:
| Does Sarbanes Oxley codify culturing a culture?
|
| As far as my cursory glance at wikipedia has informed me,
| the act itself works around the "plausible deniability"
| by requiring certain disclosures containing factual
| information be signed off by key executive staff
| rendering it impossible for them to say "I didn't know!"
| with regards to specific material information.
|
| The blanket concept of holding executive staff
| accountable for the wrongdoings of the company would mean
| a lot more disclosures, forms, sign offs, etc. for "any"
| eventuality that would render the position pointless as
| they wouldn't have any time to actually do anything
| useful.
|
| Because at the end of the day how do you prove that joe
| schmoe CEO actually fostered a culture that resulted in
| criminal acts? This isn't even mentioning the individuals
| who were actually involved and _directly_ culpable.
| Taylor_OD wrote:
| I worked for a recruiting firm in the past (first job out of
| college) that changed its name every 5-8 years. After I'd
| been there 2ish years I finally got an answer WHY they did
| that. Basically, they would build up a bad reputation and the
| easiest way to get rid of it was to just change names. Most
| companies that disliked them wouldnt associated the old name
| with the new name.
|
| Shockingly it worked. Some companies that would have never
| worked with "oldCompanyName" were happy clients of
| "newCompanyName".
| wredue wrote:
| This is the school to coordinated with /r/learnprogramming to
| advertise and trick people in to registering, and when called
| on their bad practices, worked with the sub to ban users.
|
| The sub continued to deny a connection to the school, but I
| still don't believe it.
| saadatq wrote:
| Unreal:
|
| > Allred tweeted that the school achieved a 100 percent job-
| placement rate in one of its cohorts, and later acknowledged in a
| private message that the sample size was just one student.
| syntaxing wrote:
| Aha that's a gem, it's like that crypto company listed "audited
| by <some famous reliable auditor >". They do not mention they
| failed the audit, but they "did" get audited.
| FireBeyond wrote:
| Or Tether. "We realize - but hope _you_ don 't - that
| 'financial attestations' do not remotely resemble 'audits',
| but we're going to call this financial attestation an audit".
| And "If you don't fall for the first, we're going to tell you
| that we have had audits done but we won't release them
| because they're in Mandarin Chinese."
|
| I wish I was kidding.
| g42gregory wrote:
| Technically, the statement is still valid. It's just that the
| confidence interval will be wide. :-)
| threeseed wrote:
| He seems to be the king of technically.
|
| "For a few months in 2013, Allred camped out of his car while
| in Silicon Valley, and frequently describes this period as
| having been homeless. However, a deleted post on his blog
| titled 'Voluntarily Homeless in Silicon Valley' explains that
| he lived out of a car by choice."
| ultrarunner wrote:
| I have a friend who is adamant that he lives out of his
| truck by choice, but it's hard to call it a choice when
| there's only one option. I wouldn't hold his feet to the
| fire if he later admitted he was in a rough spot (our
| friend group is all very clear on this situation). I had
| put Allred entirely out of my mind for a while, but I seem
| to recall his "homelessness" was characterized more by
| image than by practicality. Since we're being technical, it
| seems worth making the distinction.
| FireBeyond wrote:
| I had this same debate here a few months ago, about
| people living out of their truck/van in Seattle, and the
| "choice" of it. There was more than one person that could
| (or would) not see the distinction. "I've seen plenty of
| social media and YT videos talking about how much they
| enjoy the experience".
|
| Uhh, when people talk of living out of a vehicle in the
| context of homelessness, they're talking about people
| parked in the back corner of a Walmart lot with their
| laundry and many earthly possessions beside them, not
| social media creators making YouTube videos for
| "#vanlife".
| sandofsky wrote:
| When confronted about this on Hacker News, Austen defended
| himself with:
|
| > I did say the hiring rate of a cohort of one student was
| 100%. And in the same tweet I said, in all caps BUT VERY SMALL
| SAMPLE SIZE. Odd how that doesn't make the article, don't you
| think?
|
| https://news.ycombinator.com/item?id=26813371
|
| Incidentally, it _did_ make it into the article he 's referring
| to, twice.
| shkkmo wrote:
| Incidentally, comments like the one you made back in 2021 are
| part of what make HN so great, thanks.
| kevinmchugh wrote:
| I've been in a lot of from arguments but never had one where
| I was later proven right by the federal government. That's
| quite the feather in your cap.
| sensanaty wrote:
| I could almost respect the hilarity of this defense if it
| weren't about him having scammed people for (in aggregates)
| millions
| tempsy wrote:
| From what I've read about his career before this he was
| basically a growth marketer/hacker
|
| Like the only thing he knows how to do is fudge things with
| dark patterns to achieve growth at any cost
| solardev wrote:
| Are there any _legit_ income-sharing schools of this type, tech
| or otherwise? Done fairly, it sounds like an interesting
| alternative to upfront tuition.
|
| On the surface it doesn't seem like a bad model, but of course it
| could be twisted to evil ends. From the article:
|
| > The loans carry substantial risk, as a single missed payment
| triggers a default and the remainder of the $30,000 "cap" becomes
| due immediately.
|
| > Students were therefore deprived of rights they should have had
| when their "income share" loan was sold to an investor [without
| the required Holder Rule provisions transferring legal
| responsibilities to the new owners].
| jimberlage wrote:
| App Academy (in a much hotter 2013 job market) honored its 10%
| of my first year's salary ISA when I attended. Anecdotally from
| my cohort, they worked with people on missed payments without
| triggering a balloon repayment.
| LamaOfRuin wrote:
| The income based repayment plans for federal student loans are
| not that different (but without most of the sketchy practices).
|
| The fact that those are an option for accredited schools means
| I think it would be hard to make it work in a program like
| this. Especially if there is any sort of venture interest
| expecting actual returns. Actually educating people well is not
| cheap and I have not seen any of these programs that actually
| do anything innovative either.
| solardev wrote:
| > income based repayment plans for federal student loans
|
| Ah, I didn't realize that was a thing. That makes sense,
| thank you!
| jswartz wrote:
| > I attended Launch School and found the founder and the
| program to be of high quality and integrity and the success of
| the capstone graduates speaks for itself.
| solardev wrote:
| Is this a quote from somewhere? (Or maybe just an errant >
| symbol?) Just wondering if it's your own experience or I
| missed something
| jswartz wrote:
| Sorry errant >. It was based on my own experience. Launch
| School has a unique model where it's $200/month for the
| core curriculum which you complete at your own pace, and
| then can complete an optional capstone curriculum/project
| which comes with an ISA (18K or 18% of first year salary).
| Their outcomes are great, the curriculum is top-notch, and
| the founder always conducted himself with integrity and
| transparency. I had a great experience.
| solardev wrote:
| Cool, thanks for sharing! Another commenter also liked
| them.
| beej71 wrote:
| Thanks for sharing an ISA success story. Lots of us who
| used to teach at Lambda back in the day only did it
| because we wanted the ISA to succeed widely as a tuition
| payment mechanism.
|
| That dream hasn't been realized, and certainly wasn't by
| Lambda, but I still hold out hope.
| majormajor wrote:
| The math ends up wildly unfavorable unless you are EXTREMELY
| confident in your teaching/transformation abilities.
|
| If you look good on paper _before_ the school then you don 't
| need it and won't be motivated to share your income. So the
| applicant pool reduces itself to those who on-paper don't have
| great chances. So you need to cause a really big delta in the
| ability of those people to make good money in the industry for
| you to be able to get your cut.
|
| And you're gonna pull that off in 6 to 9 months? I'm a big
| believer in a lot more people having potential to learn than
| currently have easy opportunities, but that's a hell of a
| timeline.
| solardev wrote:
| Well, presumably there's some people who wouldn't be able to
| afford the upfront tuition?
|
| But you're right, $30k (in the worst case) is a lot of money
| to pay for less than a year of bootcamp.
| mrguyorama wrote:
| $30k is also enough to pay for a shitload of American state
| schools BS in Computer Science program. WTF That's about
| what I and my friends paid!
|
| That includes room and board in an expensive dorm (it was
| part of the honors program I was in) and a meal plan with
| the school.
| jimberlage wrote:
| I remember the marketing for App Academy was that we all
| would be self-taught, but then the actual makeup of the
| cohort were people who had prior programming experience (CS
| all through high school and as a hobby, but studied
| linguistics in college and regretted it; a designer who had
| done some JS and couldn't pass leetcode interviews despite
| having current frontend skills, etc.)
|
| I think the problem they've run into is that there are only
| so many of those types to go around, and you have to stay
| small or really tackle the problem of transforming someone in
| 12 weeks eventually. That's a different and much harder ask.
| busterarm wrote:
| Early a/A cohort attendee here.
|
| They literally ensured their success by filtering for
| people who would already succeed no matter what. I don't
| have any misgivings about it because the curriculum did
| help me focus on some gaps in my understanding and build up
| a profile/portfolio that could land jobs.
|
| It's still expensive and had that curriculum been open at
| the time I could have done the whole thing on my own and
| saved some money.
|
| The social aspects of the program didn't end up really
| benefiting my career at all. The vast majority of my cohort
| had STEM degrees from prestigious places or were people who
| were programming since an early age like me. I had already
| had a long career in IT before I attended. 100% did get
| jobs, but 2 of the guys in our cohort struggled for a while
| -- though I think that was to get out of paying the ISA.
| Taylor_OD wrote:
| Yup. When the Bootcamp market flourished (early/mid
| devBootcamp days) and incredible results seemed common it
| was exactly for the reasons you mentioned. Many early
| attendees were folks who either had some previous technical
| experience or were very smart and proved in some other
| field but wanted to move into dev work.
|
| Eventually the majority of those folks who were going to
| make the switch... Did. Then the average bootcamp graduate
| became someone who bought into the hype that anyone could
| learn to code. A lot of truck drivers, CS reps, and
| teachers applied. There nothing stopping those people from
| becoming great engineers. But they are going to have a more
| difficult time on average than the person who dabbled in
| coding for ten years while working as an engineer in
| another field and just needs a crash course to be
| proficient in web development.
|
| Placement rates dropped significantly around that time.
| londons_explore wrote:
| There was a time about 5 years ago where tech companies were
| desperate to fill various minority quotas. The idea was those
| people were very valuable, there were very few applicants who
| were hotly contested by other tech companies, and lack of
| skills wouldn't matter - they'd learn on the job.
|
| In that world, the school only has to get the students to do
| a "hello world" in python and apply for the right jobs. Such
| a school is very cheap to run, and very lucrative as long as
| a decent proportion of students fit into the desirable
| categories.
|
| The students themselves usually aren't aware how desirable
| their application is - and therefore believe the school is
| their route in rather than a few youtube tutorials and a
| direct application.
| cool_dude85 wrote:
| What tech companies do you allege have/had "minority"
| quotas to fill?
| ec109685 wrote:
| Google goes to great lengths to increase diversity:
| https://about.google/belonging/diversity-annual-
| report/2021/...
| davely wrote:
| Not that you're arguing for or against, but I thought I'd
| drop an interesting link to a 2020 McKinsey and Co study
| that shows more diverse companies generally outperform
| their peers. [1]
|
| Is there any wonder that Google and other (not exclusive
| to tech) companies desire this?
|
| [1] https://www.mckinsey.com/featured-insights/diversity-
| and-inc...
| LunaSea wrote:
| Is that the same McKinsey that helped start opioid
| epidemic?
| londons_explore wrote:
| This is also self-fulling. Investors that see this invest
| into more diverse companies, who in turn do better
| because they get more investment.
|
| Write a convincing report saying "Companies with a Z in
| the name do better", and you'd see the same result.
| srockets wrote:
| There's quite a chasm between trying (and failing, but I
| digress) to increase diversity of the workforce and those
| imaginary quotas.
| anonymoushn wrote:
| Thoughtworks wrote in an email to me that they were only
| considering non-male candidates because of their quotas.
| The idea, I suppose, is that I should be willing to
| change my gender if I'm really interested in joining.
| beej71 wrote:
| Is that legal?
| cool_dude85 wrote:
| At least in the US, if this person received such an email
| they would be able to sue the company that sent it quite
| easily.
| anonymoushn wrote:
| I spoke to a bunch of lawyers who all told me they hoped
| I found some lawyer who would do that. The EEOC decided
| that if a manager directs their reports (engineers) to
| advertise a position, then people apply to the position
| as directed by emailing the engineers, then the engineers
| say some stuff about gender quotas, that's fine, because
| the applicant didn't fill out some other form and the
| company disavows this recruitment process to the EEOC
| while using it to source candidates.
| skywhopper wrote:
| If they had quotas, they were made up internally. But
| more likely they were just lying to you, or the person
| who sent the email was twisting the truth. I don't think
| anyone but you thought of the "maybe you should change
| gender" bit. They just didn't want to hire you,
| personally.
| londons_explore wrote:
| Plenty of recruitment teams get given targets. Just one 1
| memo saying "hires that don't bring the company towards
| our diversity goals won't count for your metrics"...
|
| (I have worked with 2 such recruitment teams).
| manquer wrote:
| Not necessarily, fresher or graduate trainee programs are
| this effectively.
|
| Large companies especially conglomerates do this by hiring
| freshers and investing in their learning and benefit by
| paying a bit lesser than the market over the years .
|
| Apprenticeship has also been successful economically at even
| a scale of one master/sole proprietor for centuries.
|
| The key is to derive value while they learn, not split the
| learning and earning parts completely
| sarchertech wrote:
| Apprenticeships also take 3-4 years on average.
| mushufasa wrote:
| > Are there any legit income-sharing schools of this type, tech
| or otherwise? Done fairly, it sounds like an interesting
| alternative to upfront tuition.
|
| investing in startups is kindof like betting on the future
| potential of founders, though it's tied to a business idea.
|
| Upstart started as a personal loan for students and expanded to
| other financial services, it went public recently. They
| innovated by doing the regular thing (student loans) better
| than the competition, rather than trying to be both the lender
| and the school https://en.wikipedia.org/wiki/Upstart_Holdings
|
| > but of course it could be twisted to evil ends.
|
| My speculation is that this was a 'road to {} paved with good
| intentions.' Just like most startup products face challenges in
| the real world, it sounds like the Lambda School tried
| everything they could to get high job placement rates, but
| weren't able to deliver at scale.
|
| Then, as their early placement % dropped, they just didn't
| change the numbers in their marketing materials. After a
| certain point their early hopes and reality diverged enough to
| constitute fraud in the eyes of the CFPB
|
| Anecdotally, we get a lot of applications for any software job
| posting, and I discard most of the resumes of recent bootcamp
| graduates. It's nothing against bootcamps, it's just a signal
| that the person is a junior engineer. And in the cases we have
| hired people with less work experience for junior roles, we've
| had a much higher signal-to-noise ratio in our interview
| process talking to people who completed traditional education
| (even if it was not directly a CS program) and have enough of
| those applicants as-is.
| adamisom wrote:
| Yes, the one I did. Launch School (their Capstone program) is 1
| year 18%ish ISA. Since, when I did it, 100% of my cohort got
| real-Dev jobs averaging 120k+, the school still got
| 20k+/student. They're the anti-lambda school in my book. If
| anything too modest in their marketing. Best decision of my
| life.
| zmgsabst wrote:
| Trade apprenticeships pay you to study, in return for low(er)
| entry wages via the union hierarchy.
|
| This isn't formalized into a loan, though. Which is better for
| the student.
|
| https://www.lni.wa.gov/licensing-permits/apprenticeship/beco...
| zharknado wrote:
| This isn't the same type of school, but Purdue was an early
| experimenter with ISAs. Sounds like as of 2022 they'd paused
| new enrollments. [0]
|
| As I recall, some critiques were that it was only deemed viable
| for a small range of STEM majors, and narrows the mission of
| the institution toward building earning power vs. providing a
| well-rounded education, being an intellectual/research hub for
| the community, etc.
|
| [0] https://www.insidehighered.com/news/2022/06/23/purdue-
| pauses...
| not_wyoming wrote:
| Yes. Most states have a system where students attend school,
| receive an education, and pay the school back using a portion
| of their income after graduation.
|
| They're often referred to as "public schools", and ISAs are
| often called "taxes".
| peripitea wrote:
| Those schools still charge you $50k and take 4 years of your
| time, so I'm not sure how that comparison makes sense,
| particularly for working folks looking to uplevel their
| skills.
| not_wyoming wrote:
| Those schools have not always charged $50k - that's a
| recent political choice. I'd point to student loan policy
| as the main driver [0].
|
| Many bootcamps require full-time attendance, and many
| universities have part-time options. Further, community
| colleges are an option if the only goal is skill
| acquisition. Those programs take less time and are cheaper.
|
| 0 - John Oliver is not the primary driver of my thinking,
| but he did an interesting and engaging segment if you're
| interested: https://www.youtube.com/watch?v=zN2_0WC7UfU
| foobarqux wrote:
| Remember that the initial reporting of these crimes many years
| ago was called a "hit piece".
| etaioinshrdlu wrote:
| These fines seem incredibly low to me - they're slaps on the
| wrist!
| next_xibalba wrote:
| Putting these together:
|
| "permanently bans BloomTech from all consumer-lending
| activities and bans Allred from any student-lending activities
| for ten years"
|
| "ordering BloomTech and Allred to cease collecting payments on
| income share loans for graduates who did not have a qualifying
| job, eliminate finance changes for certain agreements, and
| allow students the option to withdraw without penalty"
|
| This order seems like a death sentence. If ISAs are defined as
| consumer-lending, which the CFPB clearly says they are,
| BloomTech cannot recruit new customers. And they cannot collect
| on 50% of their outstanding loans (if the quoted internal
| placement rate is true).
| janalsncm wrote:
| > This order seems like a death sentence.
|
| Corporations aren't people. Ordering a scammer to knock it
| off isn't even close to being a serious penalty. Allred
| should be in prison.
| dragonwriter wrote:
| > Allred should be in prison.
|
| The CFPB, like every federal regulatory agency, has only
| direct _civil_ enforcement powers.
|
| They refer criminal matters to the Department of Justice,
| which usually takes significantly longer before handing
| down charges, and does not usually disclose the existence
| of an open investigation until and unless it issues an
| indictment.
| bikemore wrote:
| I think that was more of a wishful "should" instead of a
| prescriptive one.
| next_xibalba wrote:
| > Allred should be in prison.
|
| Absurd.
| ilaksh wrote:
| The CEO should go to prison. Obviously. This is what's wrong
| with our society -- too much upside to being dishonest, very
| little downside. People with integrity are practically punished
| for it.
| adubashi wrote:
| There's probably a good argument to ignore rule breaking and
| little deceptive marketing if the student outcomes are good but
| it looks like in-aggregate that they weren't and that students
| were better off taking a loan and attending Oregon State's Post
| Bac in CS or Hack Reactor.
| hocuspocus wrote:
| And if you really believe you can succeed as an autodidact with
| minimal mentorship from previous batches of students, 42
| schools[1] offer that for free.
|
| It's shameful YC was still shilling Lambda one year ago[2] even
| though there's been a mountain of evidence about its deceptive
| practices for many years.
|
| 1. https://www.42network.org
|
| 2. https://www.ycombinator.com/library/5N-on-starting-and-
| scali...
| michaelbrave wrote:
| I'm still sad about 42 in Fremont closing, but if you live
| near one, it was quite worthwhile.
| maxerickson wrote:
| There's no reasonable argument in favor of deceptive marketing.
| This idea that we should tolerate bullshit from people trying
| to make money needs to go away.
|
| If the outcomes are good for the students, there won't be an
| issue with making them be straightforward about it.
| dragonwriter wrote:
| > There's probably a good argument to ignore rule breaking and
| little deceptive marketing if the student outcomes are good
|
| A big thing that rule breaking and deceptive marketing due is
| cover up that the student outcomes are not good.
| petsormeat wrote:
| It's disappointing that California's Bureau for Private and Post-
| Secondary Education (BPPE) continued to approve this boot camp. I
| thought the rationale for creating the bureau was to discourage
| scams in job training.
| sandofsky wrote:
| At first I found it weird that the BPPE can't discipline a
| company until it's registered and operating legally. So for the
| first few years, it couldn't do anything. The twist is that
| until the BPPE approves a school to operate, any student debt
| obligations up to that point are not valid. In theory, anyone
| in California who enrolled before August 2020 owes them
| nothing.
|
| The problem is that Lambda School still tries to service those
| debts. The victims are usually low-income, so they lack the
| resources to lawyer up. If they do lawyer up, they end up being
| forced into arbitration due to an arbitration clause in their
| student agreements.
|
| So in the end, it does feel like the BPPE is a half-measure
| that doesn't fully tackle predatory companies.
| JumpCrisscross wrote:
| > _If they do lawyer up, they end up being forced into
| arbitration due to an arbitration clause in their student
| agreements_
|
| You're literally describing why arbitration works. Someone
| low income can just file for arbitration with minimal work by
| a lawyer. Contrast that with the tens of thousands they'd
| need to pay a litigator.
| sandofsky wrote:
| That true, but this ends up being a game of whack-a-mole,
| and even a few thousand dollars is too much for a lot of
| victims. Recently there was an attempt to mount a class
| action lawsuit, which would have settled things for
| everyone in one fell swoop, and it was rejected due to the
| arbitration clause.
| JumpCrisscross wrote:
| > _even a few thousand dollars is too much for a lot of
| victims_
|
| Someone angling to go into coding should be able to do
| the research to draft an arbitration claim on their own.
| In most cases that isn't a fair assumption to make, but
| given the cohort, they should be able to collaborate on a
| draft.
|
| The gating part isn't doing the work. It's knowing you
| have the option to.
| sandofsky wrote:
| Do you think they should have listed "draft an
| arbitration claim," on their enrollment prerequisites?
| JumpCrisscross wrote:
| > _Do you think they should have listed "draft an
| arbitration claim," on their enrollment prerequisites?_
|
| Unless you're a total numpty, you can learn online how to
| draft an arb claim. And even if you _are_ a numpty, you
| should be be to find--in a half-decent cohort--someone
| who can do this.
|
| The issue is rarely ability. It's learned helplessness in
| the face of the legal system. The anxiety, not ability,
| is the limiting factor.
| sandofsky wrote:
| The company targeted the poor, single mothers, reformed
| convicts, and other disadvantaged groups. They tend to
| lack the free time or guidance to navigate these
| situations. If this work is trivial to you, I am happy to
| connect you with them to provide your services.
| JumpCrisscross wrote:
| > _If this work is trivial to you, I am happy to connect
| you with them to provide your services_
|
| It is. I won't because this isn't something I care deeply
| about. The question is whether they would have been
| better off without arbitration, and the answer is no.
| sandofsky wrote:
| In January, a class action lawsuit was rejected by a
| judge due to the arbitration agreement in the contracts.
| The whole reason class action suits exist is to save
| thousands of people from having wage individual fights.
| If it had gone through, the victims could have done
| nothing and woken up one day to an email saying, "Your
| debts are clear."
|
| I honestly can't think of a clearer example of
| arbitration agreements screwing people over.
| lazyasciiart wrote:
| And fuck people with anxiety, right?
| vitalurk wrote:
| They split the students to take away their power. They
| kicked people off Slack, wiping the incriminating message
| history, and then re-adding students (woopsie), they
| allowed rampant racism to be posted in the channels. They
| did so many shady things with arbitration, it was
| absolutely harmful.
| reaperman wrote:
| https://news.ycombinator.com/item?id=40071539
|
| > _I went to a lawyer and was told it wasn 't worth suing,
| because they required arbitration in NYC, which would cost
| more than I would save._
|
| It sounds like arbitration does _not_ work, according to
| people who had their lawyer look into it for this exact
| case. What are your thoughts on it given this new
| information available to you?
| JumpCrisscross wrote:
| > _What are your thoughts on it given this new
| information available to you?_
|
| Curious who that lawyer is. Because for financial
| arbitration, the win rates are ridiculously skewed in
| favour of borrowers and retail investors.
| eadler wrote:
| Do you have a source for that?
|
| I'd like to read it and add it to this list:
| https://arbitrationinformation.org/docs/references/
| JumpCrisscross wrote:
| That looks like a biased source, concluding in the first
| sentence of its introduction that "pre-Dispute
| Arbitration agreements force people into a form of
| 'Rustic Justice' whose primary purpose to evade
| meaningful accountability for violations of contract or
| statutory rights" [1].
|
| That said, I do know bank lobbying group who want to
| outlaw arbitration for unaccredited investors. Will pass
| this along.
|
| [1] https://arbitrationinformation.org/docs/problems/
| eadler wrote:
| I wrote that page after reading every one of those
| sources. In full. Including all cited supreme court
| cases. I actually initially felt that mandatory
| arbitration was fine and somewhat pro consumer. I changed
| my mind as a direct result of the research.
|
| To the extent possible id like to strongman arbitration
| but need to find sources.
| cscurmudgeon wrote:
| Reminder: California passed a minimum wage law for fast food
| workers that exempts places that make their own bread (ahem,
| totally unrelated coincidence: Panera which bakes their own
| bread is a big donor to CA's governor).
|
| https://www.reviewjournal.com/opinion/editorials/editorial-c...
| __float wrote:
| How is that related to coding bootcamps? Is it just a general
| dig in the direction of anything Caliornian?
| wtf92345923 wrote:
| Am I crazy, or do fines never come close to matching damages? Or
| jailtime? I'm constantly seeing rulings or indictments where an
| article says "defendant faces $1500 in fines or two years jail
| time", as if those are in any way equivalent. Were all the fine
| quantities written up in 1875 and just never got updated?
|
| In this case, defendants are accused of conning "at least 11,000
| income share loans" "carrying an average finance charge of around
| $4,000", but their fine is $164,000? A fraud of $44M just for the
| financing charges produces a fine of $164K? As I missing
| something?
| openasocket wrote:
| Those articles you are reading are just poorly worded. For any
| criminal case, it is a matter of fines AND jail time. You could
| be sentenced to jail time and no fines, or fines and no jail
| time (though this is rare), but the majority of the time you
| get fines and jail time. Generally, for criminal issues, the
| punishment is really in the jail time, the fine is just extra.
| ryandrake wrote:
| The US justice system and regulatory agencies treat
| corporations with kid gloves. They often get many strongly
| worded letters and many chances to correct their bad behavior
| before regulatory action happens, and then when it does happen,
| it's slow and the corporation usually continues to operate, and
| then when penalty comes, it's some ridiculously small fraction
| of the gains that came from the bad behavior, which the
| corporation usually appeals and gets reduced or thrown out.
|
| There are almost never company-killing fines. There are almost
| never consent decrees with stipulations that change the
| company's behavior. There are almost never instances of
| piercing the corporate veil and going after executives or
| shareholders. It's a total joke.
| wslack wrote:
| There's an incentive problem here because litigation is so
| expensive. If the fine is large enough, it becomes more and
| more worth it for the company to fight it in court - and
| therefore more expensive to the regulatory agency's legal
| budget. The only folks who benefit from it going to court are
| private lawyers.
|
| Whereas, settling meets the company's incentives (eliminating
| uncertainty), meets the regulator's incentives (bad behavior
| is stopped locally). The moral hazard created by making fraud
| seem less risky (because the punishments aren't that bad) is
| born by the public.
|
| The solution here would be to limit the possible legal
| shenanigans that companies can use to increase the cost of
| taking a case to trial.
| mushufasa wrote:
| Generally, yes fines are a fraction of damages; fines are meant
| to deter, and are paid to a regulator not the damaged party.
| Payout from a lawsuit is meant to capture damages, and pay to
| the damaged party directly.
|
| In this case, the 'stick' is that CFPB is preventing the
| company from issuing new loans, de facto forcing them to cease
| operation. (Or I guess charge regular tuition, like a normal
| school?) That's a pretty big deal.
| SuperNinKenDo wrote:
| Forcing somebody to cease committing a specific form of fraud
| is a "big deal"?
| abnercoimbre wrote:
| According to The Verge [0] "None of this puts BloomTech out
| of business, by the way -- it can keep operating with third-
| party loans instead."
|
| And to make matters even more depressing the CEO just tweeted
| [1] that it's no biggie for him:
|
| > BloomTech continues to focus on its core mission: improving
| the lives of students and enabling them to fulfill their
| economic potential. While it's been frustrating, we're glad
| to put this behind us.
|
| [0] https://www.theverge.com/2024/4/17/24133577/lambda-
| school-bl...
|
| [1] https://twitter.com/Austen/status/1780770303406403701
| dragonwriter wrote:
| > Am I crazy, or do fines never come close to matching damages?
|
| Fines aren't intended to replace damages. If they are criminal
| fines, criminal restitution is also available through the same
| process. Even where criminal restitution isn't available or,
| for whatever reason, pursued, or where the fines are civil,
| civil damages for those harmed are not precluded by the fines,
| they are on top of the fines. Fines are punishment, not
| compensation.
| jcryzu wrote:
| It was a hell of a con!
| tempsy wrote:
| Biggest red flag for me is Austen has basically become a full
| time right wing reactionary on X/Twitter
| beau_g wrote:
| I don't know anything about this guy or his beliefs, but the
| biggest red flag for me is he has a normal name with weird
| spelling. I don't trust anyone with this naming configuration.
|
| normal name - normal spelling - ok weird name - normal spelling
| - ok weird name - weird spelling - ok normal name - weird
| spelling - no go
|
| I don't want to hear some Jane Austen excuse either.
| TheMagicHorsey wrote:
| This is great. But I hope they do the same thing to so called
| "legitimate" universities who have long deceived students as to
| the value of the degrees they grant.
|
| I recently met a liberal arts student from an Ivy League
| university who has been under-employed for twenty years. She
| still has unpaid student loans and she graduated in 2007! She has
| had to work in retail positions from time to time. And she's
| considering retraining via a vocational school to be an
| electrician because that's what her father and brothers do and
| they make 300K+ a year via the family business.
| Jasper_ wrote:
| https://twitter.com/austen/status/1780428614192033999 lmao
| ec109685 wrote:
| Well, to be fair, their base is probably pretty small right
| now.
| afavour wrote:
| Honestly this ought to be an indictment against the Silicon
| Valley set as a whole but oh well:
|
| > The investment is largely coming from Gigafund, the VC started
| by ex-Founders Fund partners in 2017 originally to put more money
| into SpaceX, with Tandem Fund and Y Combinator (where Lambda
| School was incubated) also participating. Its list of other
| backers include GV, GGV, and Stripe. (Tommy Collison, the head of
| business development at Lambda, is the younger brother of the two
| Collison brothers who co-founded Stripe.)
|
| https://techcrunch.com/2020/08/21/lambda-school-raises-74m-f...
| magicmicah85 wrote:
| BloomTech about to get a name change.
|
| Honestly wonder what the true placement rate was. There seem to
| be some success stories I'm seeing on Twitter but this could have
| all been avoided had they just been up front.
|
| That $164,000 victim fund sounds pitiful but I do wonder how it
| is calculated.
| kklisura wrote:
| > ...with inflated promises of job-placement rates as high as
| 86 percent, when the company's internal metrics showed
| placement rates closer to 50 percent and in some cases as low
| as 30 percent.
|
| > BloomTech advertised on its website that 71 to 86 percent of
| students were placed in jobs within six months of graduation,
| when its non-public reporting to investors consistently showed
| placement rates closer to 50 percent. Allred tweeted that the
| school achieved a 100 percent job-placement rate in one of its
| cohorts, and later acknowledged in a private message that the
| sample size was just one student.
| magicmicah85 wrote:
| I'm such a derp, I literally read right past that, thanks.
| wredue wrote:
| For the record, it's actually far worse than this even, as
| many of your "teachers" are just people from the previous
| cohort.
|
| After a slew of negative reviews came from a few people that
| verifiably took the early courses, lambda decided not to
| improve their course, but instead to do two things:
|
| 1) they gave students financial credit for posting positive
| reviews on social media
|
| 2) they paid review shops out of India and China to bombard
| the internet with fake positive experiences.
|
| This school are scumbags. Frankly I am shocked that it still
| exists and people still go there.
| reaperman wrote:
| #2 is a clear FTC violation if I'm not mistaken.
| vitalurk wrote:
| Good to see some justice
| danso wrote:
| pg in 2019:
|
| > _Lambda School will go on growing and transform education. Few
| will remember having been part of the jeering mob._
|
| https://twitter.com/search?q=from%3Apaulg%20lambda&src=typed...
| spxneo wrote:
| now do coinbase!
| vvpan wrote:
| What's wrong with coinbase?
| datadrivenangel wrote:
| Core concept and the economic prospect?
| AlchemistCamp wrote:
| Coinbase is a winner on both dimensions.
| sandofsky wrote:
| In January 2020, as news broke about Lambda School's scummy
| behavior, Graham gave Austen a pep talk which he later expanded
| into the essay, "Haters." It has aged like a fine milk.
| https://paulgraham.com/fh.html
| CPLX wrote:
| The more we see the legacy of PG's various proteges and
| "thought leadership" out in the world the more I start to
| think Jessica Livingston might have been responsible for much
| more of YC's successful trajectory than people realized at
| the time.
| robocat wrote:
| PG writes about her influence here, and why she avoids the
| spotlight:
|
| https://www.paulgraham.com/jessica.html
|
| He also seems to give some credit to Jessica for choosing
| to back the Reddit founders: we thought
| that we were funding ideas rather than founders, we
| rejected them. But we felt bad about it. Jessica was sad
| that we'd rejected [them].
|
| Edit: she gets mentioned here too:
| https://www.paulgraham.com/ycstart.html
| uhohspaghetti wrote:
| Candidly, that was pretty clear even decades ago when this
| was an obscure little place.
|
| PG, for example, didn't realize that discriminating against
| people who have children might not be great until he
| himself had kids.
|
| He's a mid dude with gross feet who came up with a wildly
| profitable business model (6% equity in as many promising
| founders as possible).
| leosanchez wrote:
| > He's a mid dude with gross feet
|
| Does he sell feet pics :) ?
| debo_ wrote:
| From the footnotes:
|
| > There are of course some people who are genuine frauds. How
| can you distinguish between x calling y a fraud because x is
| a hater, and because y is a fraud? Look at neutral opinion.
| Actual frauds are usually pretty conspicuous. Thoughtful
| people are rarely taken in by them. So if there are some
| thoughtful people who like y, you can usually assume y is not
| a fraud.
|
| I guess all those folks calling these guys "frauds" weren't
| "thoughtful" enough.
| choppaface wrote:
| Same with FTX, VCs projected themselves as thought leaders
| buying into FTX and then it turned out they had never even
| thought
| amadeuspagel wrote:
| Graham also wrote _Crazy New Ideas_ [1] in response to
| criticism of Mighty, in which he claimed that if
| "reasonable domain experts" propose an idea it can't be
| crazy.
|
| [1]: https://paulgraham.com/newideas.html
| pge wrote:
| I wish PG was right about this, but there are plenty of
| examples of frauds that were not conspicuous and took in
| lots of thoughtful people (Bernie Madoff being one of the
| most obvious and public examples).
| beej71 wrote:
| (Edit: I've been informed on a side channel that non-
| disparagement clauses can no longer be enforced. IANAL--can
| someone elaborate?)
|
| As someone who was a low-ranking insider at Lambda some
| years back, it was my perception that the people calling
| Lambda out presented a mixed bag in terms of veracity.
|
| Someone here commenting on this story said that Lambda
| counted their student TAs in their employment stats, for
| example, but to the best of my knowledge this never
| happened. There were a handful (like three or four that I
| know of) that we did hire as full-time staff doing real
| jobs, and I'm pretty sure we counted them as employed, but
| not the student TAs.
|
| With respect to this ruling, it says that students were
| subjected to up to $4,000 finance charges. I hadn't heard
| of that at all. Reading the details, it turns out that's
| the difference between the published upfront cost of paying
| Lambda versus using an ISA. The upfront cost wasn't hidden;
| it was published right next to the ISA cost. But because
| they weren't the same value, and it was probably more
| expensive to use the ISA, they called the difference a
| finance charge. Which is fine, but if Lambda had simply not
| allowed people to pay upfront, there wouldn't have been a
| "finance charge" to complain about. In other words the
| finance charge was already published in the rules for how
| the ISA would be repaid. So, factually accurate, but a
| strange thing to complain about, like complaining that the
| upfront cost of a house is lower than the mortgage cost.
|
| Still others complain about the selling of the ISAs to
| investors, and say that that means that Lambda would still
| make money no matter how well their students performed.
| However, this would be a very short-sighted strategy as no
| investors would buy the ISAs if the students weren't
| performing. So selling them didn't really remove any of
| Lambda's impetus to place students in jobs. (It did improve
| the cash flow situation, however, which is why it
| happened.) From what I saw, the goal of placing students
| was ever-present regardless of whether or not Lambda was
| currently selling ISAs.
|
| My point is, there's a lot of information out there by a
| lot of people who aren't sure about what they're talking
| about. And it can be tough to know what's real and what's
| not.
|
| One thing I can say with certainty is that all the
| instructors who worked there back in the day were
| absolutely fucking passionate about getting students into
| jobs and changing the world, in that naive startup way.
| Some of the success stories from those early cohorts are
| the things I'm most proud of in my entire tech and teaching
| career.
|
| As part of my layoff agreement, I had to sign a non-
| disparagement clause to get my severance.
| sandofsky wrote:
| > Someone here commenting on this story said that Lambda
| counted their student TAs in their employment stats, for
| example, but to the best of my knowledge this never
| happened. There were a handful (like three or four that I
| know of) that we did hire as full-time staff doing real
| jobs, and I'm pretty sure we counted them as employed,
| but not the student TAs.
|
| That's true. A source of confusion is that the school did
| hire at least one bootcamp graduate as an instructor,
| though he graduated from a different bootcamp. And it's
| worth pointing out that the marketing material promised
| world class instruction, and a fresh bootcamp grad with
| zero industry experience is the very opposite of that.
| For that matter, the head of the data science program was
| the CEO's brother, whose only industry experience was
| from a no-name company in Utah.
|
| > With respect to this ruling...
|
| It's a waste of time to argue the semantics of income
| share agreements at this point. They always operated in a
| gray area, which is why Lambda School hired lobbiests to
| try to make them officially legal. That effort failed,
| and the law has decided they're just another form of
| loans with convoluted hoops to jump through.
|
| I imagine that they got that $4,000 number from all the
| people who attended the program, received zero practical
| skills to get jobs, went on to further training (another
| bootcamp or even an associates degree) and still had to
| pay back the company because the terms of the ISAs lasted
| anywhere from five to eight years.
|
| > Still others complain about the selling of the ISAs to
| investors, and say that that means that Lambda would
| still make money no matter how well their students
| performed. However, this would be a very short-sighted
| strategy as no investors would buy the ISAs if the
| students weren't performing.
|
| Given the ISAs disappeared from the marketplaces that
| resold them to hedge funds, that sounds like exactly what
| happened. The issue is that it fooled prospective
| students into thinking, "Hey, if this company is able to
| run off ISAs, the program must work!" In fact the company
| made money by leaving hedge funds as bag holders.
|
| > My point is, there's a lot of information out there by
| a lot of people who aren't sure about what they're
| talking about. And it can be tough to know what's real
| and what's not.
|
| The same is probably true of Bernie Madoff, Charles
| Ponzi, and Sam Bankman-Fried. When someone acts like a
| sociopath for long enough, people start to assume that
| everything they do is unethical. There is a long list of
| crimes that the company committed which have been
| verified from multiple sources. A few people on the
| internet getting the details wrong doesn't invalidate
| that.
|
| > As part of my layoff agreement, I had to sign a non-
| disparagement clause to get my severance.
|
| They did the same thing to students who scrounge together
| the money to hire a lawyer to get out of their ISAs.
| These students had to any reference to Lambda School from
| their LinkedIn profile and tell nobody about what
| happened. While you did it to make money, imagine how it
| would feel sign away your right to free speech for fear
| of a $30,000 debt.
| beej71 wrote:
| > I imagine that they got that $4,000 number from all the
| people who attended the program, received zero practical
| skills to get jobs, went on to further training
|
| But to be clear, that's not where they said they got the
| $4000 number. It would be one of those things that'd be
| nice to correctly know. Do ISAs come with a hidden $4000
| fee? The answer: no. Did they have to pay $4000 more
| because of additional training? No. Did the ISAs last 8
| years? No. (At least not for any of the years I was
| there.)
|
| > Given the ISAs disappeared from the marketplaces that
| resold them to hedge funds, that sounds like exactly what
| happened.
|
| I have no knowledge of their final disposition, whether
| or not the purchasers realized gains on the ISAs.
|
| I know other companies like App Academy and Launch School
| have had successes with ISAs. For me, this is the real
| pisser of all this. I think done right it's a workable,
| useful model, but it got dragged through the mud here,
| and now we're left with the same old bullshit loans that
| are fucking the country over. I don't care about Lambda,
| but I really wish ISAs had been worked on to greater
| effect globally and hadn't gotten this tarnished image.
|
| > A few people on the internet getting the details wrong
| doesn't invalidate that.
|
| Of course not. But it also doesn't make the wrong details
| right, or something you should believe, which is what
| this subthread is all about.
|
| How can we be expected to make any learned decisions
| about these sorts of financing instruments if we're
| throwing bad information in with the good?
| berniedurfee wrote:
| "... all the instructors who worked there back in the day
| were absolutely fucking passionate about getting students
| into jobs and changing the world"
|
| 100%
|
| The fundamental concept had merit, but the business had a
| very very low probability of succeeding financially. Once
| the financials flipped, the original mission went out the
| window.
|
| I'm proud of the work I did there and I know we gave many
| students great opportunities. It was sad, but not
| surprising to see it go so wrong. But for a time, for
| many students, good things happened.
| Tommah wrote:
| This is pretty poor writing by PG here. What is "neutral
| opinion"... fact? Or the people who answer "I don't know"
| in political polls? And saying "Actual frauds are usually
| pretty conspicuous" is silly. If an attempt at fraud were
| really obvious, it wouldn't trick many people. The big
| frauds are the ones that are outwardly plausible and
| therefore trick lots of people.
| ipqk wrote:
| > Thanks to Austen Allred, Trevor Blackwell, Patrick
| Collison, Christine Ford, Daniel Gackle, Jessica Livingston,
| Robert Morris, Elon Musk, Harj Taggar, and Peter Thiel for
| reading drafts of this.
|
| Such great company he keeps.
| martythemaniak wrote:
| VCs would improve their public image if they took the
| occasional L.
| fossuser wrote:
| I thought the idea behind lambda was good I was a lot more
| surprised by PG's strong support for Mighty which seemed a
| lot more bizarre. Though his recent tweets wrt Israel have
| been the most disappointing for me.
| CPLX wrote:
| Thanks for reminding me of that.
|
| That was one of the dumbest fucking startup ideas most
| people had seen in awhile. Many just sort of said the
| obvious out loud, which is that it made no fucking sense as
| a business, and then all these rich supposed geniuses tried
| to shout them down.
|
| Even by the usual standards of the genre that one was a
| head scratcher.
| CPLX wrote:
| Amusing addendum:
| https://news.ycombinator.com/item?id=26957215
| reducesuffering wrote:
| Lambda School and Mighty having the biggest PG cheerleading
| support of anything else kind of seals the deal. You can be
| great at something for awhile but youll always lose the
| zeitgeist eventually.
| ignoramous wrote:
| Pinpointing two duds among a sea of hits to smear Paul
| is... berserk.
| busterarm wrote:
| Not when he's still doubling down on that support in the
| wake of everything.
| reducesuffering wrote:
| Not really "pinpointing" when those two were 1/2 of any
| specific startup mentions: "check out this amazing
| startup that has a whole lot of haters." How many
| startups have an entire essay written in support of them?
| https://paulgraham.com/fh.html
|
| PG stepped away from YC 10 years ago to raise his kids in
| the English countryside. I don't see what seems to
| indicate he has a great thumb on the pulse of Silicon
| Valley startups in 2024.
| ryanSrich wrote:
| Yeah the Mighty situation is when I started to question
| PG's decision making. Obviously he's super successful and
| has helped companies worth hundreds of billions of dollars
| succeed and grow. But even Steph Curry has off nights.
|
| Mighty always sounded like a bad idea. But when I saw PG
| really making a big deal about it I followed Suhail on
| twitter because I just had to see what PG was going on
| about. From what was posted online it sounded like the
| company was super successful and growing, and I still
| didn't get it. And then it went under, without any fanfare.
| Just poof.
| ineedaj0b wrote:
| Suhail was lying to himself constantly on his Twitter. He
| believed reality different. PG talked with Suhail and
| thought, well Suhail is posting publicly and telling
| those he knows and I know things are going well, so
| things are likely going well. Because who would lie that
| hard?
|
| But that was Suhail, totally sure in his lie, smart
| enough to change the future, but dumb enough to not see
| his business sucked.
|
| I don't think it's right to be hard on PG or Suhail.
| People fail and Suhail was very smart, smart enough to
| hold a fracturing vision together much longer than anyone
| thought. He looked like a guy trying really hard and
| probably was.
| CPLX wrote:
| We should be extremely hard on these people. They have
| accumulated staggering amounts of money and power and use
| it to exercise influence over many aspects of our daily
| life.
|
| As a society we should work tirelessly to hold them
| accountable and break up their concentrated power when it
| develops.
| busterarm wrote:
| Here he is just today going after the regulators in this
| situation...
| https://twitter.com/paulg/status/1780897522778554841
| eonwe wrote:
| Interesting.
|
| What do you see being disappointing about tweets on Israel?
| I've mostly seen him care about Palestine civilian deaths
| but I can't say I've read and remember 100% of his tweets.
| vvpan wrote:
| Peter Gregory.
| smt88 wrote:
| Pg is a clown and a grifter, like most VCs in Silicon Valley.
| Almost nothing he says (outside of his comments on programming)
| ages well.
| wk_end wrote:
| Even his comments on programming are...questionable. He spent
| years hyping up Arc, his "hundred-year language", and in the
| end it arrived as...Scheme with some shorthands?
| mistrial9 wrote:
| speaking of age - raise a glass to the few thousand over-
| forty people who were categorically rejected from the rank
| and file of so many Y-companies
| weezin wrote:
| This post is quite ironic.
|
| https://x.com/paulg/status/1110677737558159360
| chimeracoder wrote:
| What's the parent post? People who aren't logged in with a
| Twitter account just see the words "Lambda School", because
| Twitter no longer shows any replies or parents.
| brentm wrote:
| @tommycollison: What's going to be very important in 5
| years' time that we're not thinking enough about now?
| mvdtnz wrote:
| It makes perfect sense when you remember pg is actually a dumb
| guy.
| thenerdhead wrote:
| Dang I knew this guy from the Utah startup scene and always got
| weird vibes. Doesn't surprise me one bit.
| janalsncm wrote:
| Can you say more about the weird vibes bit?
| imzadi wrote:
| I attended Lambda when it was first starting out. I think I was
| in the third or fourth cohort. At the time, the sell was that you
| didn't have to pay anything unless you got a job using the skills
| you learned from them. I was pretty naive, I guess.
|
| Things seemed fine in the beginning. The instructors were good,
| and I liked that there were actual live classes. Things degraded
| very quickly. They kept changing the format and the curriculum
| ("iterating"). They doubled the length of the program that I was
| in, which made it impossible for me to even finish it. I was
| working in a tech support job where we had to do shift bids and
| no shift was guaranteed. I enrolled in a plan that fit the shift
| I was working, and the expected end date, and when they changed
| the program length and format, I couldn't complete it.
|
| They promised career guidance, including having a career
| councilor, but I never got one. They kept telling my cohort we
| would get our councilors after this or that milestone, but when
| we got there they would move the goalpost again. The closest we
| got was a resume course that was not relevant to tech at all and
| a resume review by another student.
|
| When I had to drop out of the program, I tried to get them to
| cancel the ISA or reduce it, but they said I had completed "most"
| of the curriculum and thus was on the hook for all of the ISA.
|
| They then started billing me for it because I was working in
| tech, in the job I had for 6 years before I ever even started
| their program.
|
| I went to a lawyer and was told it wasn't worth suing, because
| they required arbitration in NYC, which would cost more than I
| would save.
| bagels wrote:
| Did you pay? Did they sue?
| imzadi wrote:
| I paid
| neilv wrote:
| Have you contacted the CFPB, to see whether they can help now
| (in light of this press release)?
| imzadi wrote:
| I'll have to look into it more now. I had contacted a non-
| profit that represents defrauded students, but they had
| stopped pursuing it after a judge threw out their case.
| abnercoimbre wrote:
| Please contact the CFPB, it is worth your trouble. Everyone's
| blood should be boiling reading TFA, such as:
|
| > Allred tweeted that the school achieved a 100 percent job-
| placement rate in one of its cohorts, and later acknowledged in
| a private message that the sample size was just one student.
| MattGaiser wrote:
| That should just be criminal fraud.
| teeray wrote:
| Yep, jail time should be on the menu
| ec109685 wrote:
| But he said SMALL SAMPLE in all caps /s
|
| https://x.com/austen/status/1780798598046990358?s=46
| aaronbrethorst wrote:
| my dude Austen here cannot help but keep poasting through
| everything. Social media king.
| spamizbad wrote:
| Very online founders seems like a massive negative signal
| to me.
| LMYahooTFY wrote:
| This a sad amount of dog piling for HN.
|
| I know dozens of students who attended and turned their lives
| around because of the program.
|
| I see Lambda Alumni on every page of LinkedIn job boards.
|
| I'm sure some people had a bad time, but all of the ISA
| issues GP stated are clearly stated in the contract, and
| these calls for "jail time" are absurd. People clearly know
| almost nothing about the program, or its success rate.
|
| Don't forget that Student Loans still make this look like
| charity by comparison in virtually every way.
| adeon wrote:
| If 90% of students have a good experience but the 10% of
| students have a similar experiences to the poster there,
| then I still think Lambda is another ethical disaster of a
| start-up.
|
| "It's better than a typical USA student loan" is a very low
| bar.
| nolongerthere wrote:
| > _" It's better than a typical USA student loan" is a
| very low bar._
|
| But that the literal alternative, so feels pretty fair to
| compare.
| sn9 wrote:
| Not with learning programming.
|
| You can simply self-teach.
|
| A bootcamp isn't a CS degree.
| outop wrote:
| I'm not sure all the ISA issues _are_ clearly stated in the
| contract, or whether they were clearly stated in _all_ the
| contacts, before they started to get into trouble.
|
| But they clearly lied about much of this stuff in the
| headline publicity. Lying prominently and 'clarifying' the
| lies in the small print is obviously still fraud.
|
| Doing fraud and saying 'but the majority of the people we
| defrauded still had an overall positive experience' is not
| a defense.
|
| Jail time for consumer credit fraud is a perfectly normal
| outcome. Don't lend consumers money if you don't want to be
| in a regulatory environment where fraud is taken very
| seriously.
| LMYahooTFY wrote:
| Can you point out the lies? I'm genuinely trying to find
| them, and the CFPB article does not provide any evidence
| other than a few marketing quotes.
|
| I'm very sure all the ISA issues are clearly stated in
| the contract. Everything is very clear about the fact
| that you will pay a minimum of $17-18k, and a max of $30k
| as a percentage of your monthly income. It was very clear
| that missing a payment would incur the entire loan being
| owed immediately (presumably it would go to collections).
|
| The "hidden $4000 finance charge" I don't really
| understand, given that it is apparently built into the
| loan. It's not like you get charged an extra $4000 on top
| of the $30k (assuming you pay that).
|
| I'd still choose this route over 4 years plus college
| tuition for a CS degree.
| LMYahooTFY wrote:
| Seriously, all the comments questioning the dog piling of
| this thread are flagged? Mods is this not abuse? How are
| we breaking guidelines?
| outop wrote:
| It seems like you are implying that lies in "marketing
| quotes" are not real lies? I don't think that this is the
| case.
|
| In the rest of your comment you repeat the claim that I
| was responding to, that all the correct information was
| in the contract. You seem to have ignored the two key
| caveats I made: that their contracts might be compliant
| now, but they probably weren't before they were first
| investigated. And secondly that they have demonstrably
| lied extensively outside of the contracts themselves.
| Lying to convince someone to sign a contract which of
| itself is truthful, is definitely fraud.
|
| Perhaps you don't understand "the hidden finance charge"
| because you don't understand regulation of consumer
| credit. When you buy a car, the dealer has to show you
| numbers breaking down what the cash price of the car is,
| and how much you will pay in interest. This stops them
| tricking people by eg raising the sticker price and
| telling you that the credit is cheaper than it is. This
| isn't a guideline, it's a law. And the numbers have to be
| presented in a way which is not obscure or misleading.
| Scott Tucker got 16 years for this.
| schleck8 wrote:
| 100 % job placement rate 1 % of the time
| laserlight wrote:
| Here is an HN thread I had with him [0]. He claimed that 90%
| of those who were job seeking got placed. The key point was
| the definition of "job seeking", of course. I'm happy to hear
| that authorities took action.
|
| [0] https://news.ycombinator.com/item?id=33827202
| mathattack wrote:
| What a huckster!
| fossuser wrote:
| This is pretty messed up - I liked the idea of incentive
| aligned ISAs (and actually teaching a skill that universities
| mostly don't), but it still requires someone of good character
| making decisions ultimately.
| noufalibrahim wrote:
| Yes. The ISA was a good idea. It aligned the incentives of
| the company with the vocational success of the students.
| There are several clones of this in India. I assumed that the
| rest of the details (like curriculum etc.) would fall into
| place and the thing would be atleast a moderate sustainable
| success.
|
| I think that's it's the pressure to grow and become a
| "unicorn" that seems to encourage these kinds of ugly
| compromises and behaviour. That kind of thing can be just
| annoying if the company was some kind of social media thing
| but when you get involved in something as important as
| education which can have a huge impact on a persons life, you
| have to be responsible about it. But that doesn't really help
| the valuations.
| bachmeier wrote:
| > I liked the idea of incentive aligned ISAs
|
| The problem is that incentives are definitely not aligned.
| Once the student signs the ISA, they can put significant
| resources into helping the student get the best possible job,
| or they can put nothing into it and take a big share of the
| income the student would have otherwise earned. Incentives
| are only aligned if the ISA is based on the additional income
| from going through the program, and there's no way to measure
| that.
|
| I think what we've learned is that this can only work if
| there's an outside regulator, such as an accreditation body,
| preventing bootcamps from taking the parasitic approach.
| imzadi wrote:
| That's how it was sold to us. Literally, the recruiter's
| exact words were "we don't succeed unless you succeed." In
| reality, they just kept taking in more and more students.
| When you have your students doing peer reviews and self-
| reviews, there not a lot of added cost for having more
| students. So cohorts went from 8 - 10 students to 30+
| students. They also bundled ISAs and sold them off without
| telling the students they were doing it. So "we don't succeed
| unless you succeed" was patently false. They were getting
| their money up front regardless.
| abdullahkhalids wrote:
| I am high level member of a volunteer based org that does
| online workshops in the tech space, and does dozens of
| workshops in dozens of countries every year. I fail to
| understand how you can mess up basic things like having a
| predecided curriculum, good teachers, a fixed schedule, or
| providing quality outside class support. We do all of this on a
| shoestring budget.
|
| The stories I have heard about Lambda/BloomTech seem to show
| almost a willful attempt to not get the basics right. I
| understand the financial component might have been difficult,
| but the education is straightforward. To fail it with millions
| of dollars of funding is outstanding.
| japhyr wrote:
| I think if your focus is on actually educating people, and
| you're willing to invest your resources in those people, you
| can do quite well. If your focus is on scaling and creating
| an appealing image to investors, the education part isn't so
| easy.
|
| There's probably something to who you're attracting as well.
| If your pitch is "come work hard with us and we'll help you
| learn", you draw people who are ready to learn. If your pitch
| is "come take out a [loan we won't call a loan] with us and
| we'll make you a bunch of money", you draw a different set of
| people.
|
| That's not even saying anything against the students of
| Lambda school. I believe one issue has been people joining to
| improve their economic outlook, while working a different job
| to continue paying bills. You have to be pretty thoughtful
| about how you work with people who have a tight schedule. You
| can't just throw your curriculum and your expectations up in
| the air any time you want, and expect all those people to
| "pivot" with you. But the focus always seemed to be more on
| the "success" of Lambda school than on the actual success of
| every student.
|
| From all the stories that come out of Lambda school, it
| really feels like the classic predatory view of students.
| They're not so much learners as they are potential sources of
| money.
| addicted wrote:
| This is kind of true about all of Tech.
|
| Much of the crowd here isn't very smart.
|
| They simply happened to be at the right place at the right
| time, ie a time where "software was eating the world" and
| also the iPhone/Android took over.
|
| Finally, the success of the actual smart people in Tech
| (Google, Apple, Amazon, FB) who are largely pre-iPhone
| companies, meant that there was a lot of venture money
| flowing around, when the VCs discovered the Uber model. Spend
| a ton of money to establish monopolies (and break a bunch of
| laws along the way, which you could get away with because
| Tech still had a good reputation thanks again to the pre-
| iPhone pre Web 2.0 companies) and walk away with the money
| while exploiting customers, clients, governments and
| employees.
| a_random_canuck wrote:
| I wouldn't call most of those Amazon, FB, YouTube etc,
| people the actual smart people either. They're mostly just
| lucky. What made Facebook or YouTube successful over any
| other competitor? Just luck that their design turned out to
| be the one people like more?
|
| They mistakenly think their success is due to how skilled
| or smart they are they think they're hot shit and their
| thoughts are gold. But most of them are just like Elon
| Musk: average intelligence people who got lucky enough to
| climb to the top of the pile.
|
| The same is true for most software people. We think we're
| super smart because we have logical thinking and understand
| a complicated thing that most people don't, but then you
| can always get a good laugh reading the HN crowd try to
| talk smart on other subjects like physics / quantum
| mechanics.
| Enginerrrd wrote:
| A ton of skill, talent, adaptability, and mountains of
| hard work are still prerequisites for "getting lucky" in
| that way though. Just because luck plays a big role
| doesn't make it the only factor.
| kortilla wrote:
| > The same is true for most software people. We think
| we're super smart because we have logical thinking and
| understand a complicated thing that most people don't,
| but then you can always get a good laugh reading the HN
| crowd try to talk smart on other subjects like physics /
| quantum mechanics.
|
| Talking out your ass about subjects you don't understand
| isn't limit to software people. It's funny you mentioned
| physics because really smart physicists would frequently
| spew all kinds of stupidity about software when I was in
| grad school.
| dmoy wrote:
| > It's funny you mentioned physics because really smart
| physicists would frequently spew all kinds of stupidity
|
| Relevant xkcd: https://xkcd.com/793/
|
| Not all physicists. Some are pretty chill. In fact a
| physicist I worked with was the one who clued me in to
| the whole "lots of physicists think they know everything"
| joke/not-a-joke thing, he thought the whole situation was
| very funny.
| CPLX wrote:
| Shame that this is downvoted, it's a fairly straightforward
| description of what happened.
| __mharrison__ wrote:
| Not surprising. Was the founder technical? Have any insight
| about education?
| abdullahkhalids wrote:
| He didn't need insights about education. Just needed to
| hire 5-10 profs with significant industry experience and
| ask them to create a curriculum. But from the stories it
| seemed like a bunch of amateurs were playing the move-fast-
| break-things game.
| __mharrison__ wrote:
| I think you made my point...
| tbrownaw wrote:
| > _I fail to understand how you can mess up basic things
| like_
|
| Hiring people who have experience and know what they're doing
| isn't very revolutionary or disruptive.
|
| Plus it can be hard to evaluate competence in a field you
| don't know that well yourself.
| kirso wrote:
| Growth at all costs? Taking shortcuts? Sounds familiar...
| JumpCrisscross wrote:
| > _I went to a lawyer and was told it wasn 't worth suing,
| because they required arbitration in NYC, which would cost more
| than I would save_
|
| Could you do me a favour and look if they had conflicts? (Also,
| who was the arbitrator, AAA or JAMS? Because it shouldn't be
| more than $5k, and that's an extreme. Also, in most arbitration
| agreements, the company drafting the agreement pays the filing
| fees, which could knock off $100 to $3,500.)
| b800h wrote:
| I really don't understand this. Surely you can't arbitrate
| away statutory rights like this? Sorry, I'm not from the US,
| and this legal feature baffles me a bit.
| JumpCrisscross wrote:
| > _Surely you can 't arbitrate away statutory rights like
| this?_
|
| You can't, but the cost of enforcement can vary. In this
| case, it sounds like there was a bad counsel-case fit. (OP
| needed cheaper or better counsel.)
| ornornor wrote:
| This doesn't seem limited to that particular boot camp, sadly.
|
| I've instructed at two boot camps (one in North America and one
| in Europe). It seems to be standard practice in the industry:
| inflating placement numbers, very low quality
| material/curriculum and course material, a kind of omerta where
| students fear speaking up, admitting students who clearly don't
| have the skills and will drown in the course, stringing you
| along "it'll get better you'll see" until you pass the number
| of days where you can't drop out without losing a significant
| chunk of money, counting the graduates cum instructors towards
| your graduate placement rate...
|
| From my experience, boot camps are mostly scams. Maybe they
| will be a reckoning, it really sucks that the business model
| basically revolves around deception and taking thousands from
| people who want a career change.
| dghlsakjg wrote:
| It's really sad. My good experience at a boot camp seems the
| exception.
|
| We had a curriculum designed by people with a background in
| education, externally audited placement rates, an exceptional
| alumni network, instructors and mentors with industry
| experience. Most importantly, it was a non profit.
|
| It seems like there is something to be said for intensive
| vocational education. It's a shame that there are so many
| people taking advantage of students.
| cryptoxchange wrote:
| Do you mind sharing which bootcamp?
| nyarlathotep_ wrote:
| I'm surprised bootcamps are still around; I hear so little
| about them today. I figured they'd mostly closed shop
| considering the glut of layoffs, LLM fears, end of ZIRP etc.
| bachmeier wrote:
| > They promised career guidance, including having a career
| councilor, but I never got one. They kept telling my cohort we
| would get our councilors after this or that milestone, but when
| we got there they would move the goalpost again. The closest we
| got was a resume course that was not relevant to tech at all
| and a resume review by another student.
|
| > They then started billing me for it because I was working in
| tech, in the job I had for 6 years before I ever even started
| their program.
|
| This is similar to the bootcamp I saw up close. They promised
| placement help, making it sound as if they had a strong
| incentive to help students succeed, but in the end all they did
| was have someone comment on their resume.
|
| Eventually the student got a low-paying job based on their
| previous education and the company took a big chunk of the
| income. The job was unrelated to the useless and poorly
| executed instruction, yet they still got the money, because
| they had a signed contract.
|
| This is no better than the guys that make money on phishing
| attacks. Just a different form of scam.
| imzadi wrote:
| We were constantly sold this idea "we don't succeed unless
| you succeed." It eventually became clear that they had no
| commitment to individual success at all. They went from
| having 8-10 people in a cohort to have 30+ people, and
| starting new cohorts every week. It also turned out that
| Lambda was bundling ISAs and selling them off, so they didn't
| have any specific investment in actual students.
| krosaen wrote:
| > They then started billing me for it because I was working in
| tech, in the job I had for 6 years before I ever even started
| their program.
|
| That's damning. While I get that ISAs are controversial, I
| didn't expect this kind of nonsense - I wonder how common it
| was that enrollees were charged for "landing" their old job?
|
| In any case, sorry this happened to you, hopefully this recent
| ruling will give you some recourse.
| mrguyorama wrote:
| >I didn't expect this kind of nonsense
|
| Serious question: why not? What out of SV and VC in the past
| 20 years has shown they have any intention of doing anything
| the expensive but "good/right" way rather than cut any
| corner, oversell, overpromise, underdeliver, and literally
| commit crime to get their paycheck?
| metacritic12 wrote:
| Not a surprise. Allred was basically a marketing shill with no
| educational background before lambda / bloomtech. Not a
| surprise then, the claims they make will be borderline fraud.
| Aurornis wrote:
| Thanks for being honest about your experience. All of the
| Lambda grads I've talked to _in person_ have similar negative
| stories about how their experience felt like it was being made
| up on the fly.
|
| It's difficult to speak out about problems with your
| educational institutions because your own reputation is
| partially attached, at least in early career. I see a couple
| people in my Twitter and LinkedIn feeds defending BloomTech
| publicly today despite having previously complained about their
| experience in private. It must be difficult to see your
| educational experience being exposed as being poor, which
| probably prevents a lot of people from speaking out. The
| Lambda/BloomTech grads I know are actually smart people, but
| they had to self-teach their way there. Lambda lured a lot of
| smart people in by proximity to Paul Graham and all of the
| positive press they received online when they started out.
| p10_user wrote:
| This is premeditated nefariousness! Horrible
| blairanderson wrote:
| where do you work now?
| gorkemcetin wrote:
| That is probably the end of income share agreements (ISA). If any
| companies are doing ISA like that, most probably they would have
| to collect money upfront just like other bootcamps as well.
| adam_gyroscope wrote:
| Full link to consumer financial protection board announcement:
| https://www.consumerfinance.gov/about-us/newsroom/cfpb-takes...
| ChrisArchitect wrote:
| Shoulda posted that if you knew there was a link
| anamexis wrote:
| You're not replying to the OP.
| Jimmc414 wrote:
| That is the same link as the original post.
| ChrisArchitect wrote:
| (merged in comments from a dupe post)
| m3kw9 wrote:
| It was almost an open scam, how are they fined 200gs, they made
| like 100 mill
| gigatexal wrote:
| Exactly this. If the CFPB claims are true and the settlement
| seems to suggest that BloomTech and Austen agree ... then the
| penalty should include clawing back at least half of that 100M
| no?
| tech-jabroni wrote:
| Allred is a huge scumbag and PG was a big shill for Lambda. Don't
| see any mention of this from either of them Twitter, how curious
| peanuty1 wrote:
| PG has tweeted in support of Lambda.
| londons_explore wrote:
| > Allred tweeted that the school achieved a 100 percent job-
| placement rate in one of its cohorts, and later acknowledged in a
| private message that the sample size was just one student.
|
| A master of deception with statistics!
| tamimio wrote:
| Isn't this the case with a lot of these science studies? Keep
| tweaking the stats and inputs to achieve the funders' agenda..
| anamexis wrote:
| This wasn't a science study.
| adubashi wrote:
| https://twitter.com/Austen/status/1573859253797810176
|
| Honestly, there's nothing really that screams dishonesty than
| this tweet. Saying that your outcomes are stronger than ever when
| every tech company was laying off and headcount was frozen just
| doesn't pass the smell test.
| Terr_ wrote:
| > Honestly, there's nothing really that screams dishonesty
| [more] than this tweet.
|
| I was puzzled for bit, but I think you may have accidentally a
| word.
| highwayman47 wrote:
| at least before Silicon Valley scoundrels didn't pretend to be
| virtuous too
| pushedx wrote:
| The homepage is still making false claims:
| https://www.bloomtech.com/
| gigatexal wrote:
| Total fines are only 164k? Seems low if there are many more
| students with ISAs worth tens of thousands no? but didn't get
| placed?
| janalsncm wrote:
| Didn't know who this guy was but I followed him recently because
| he tweets a lot about Silicon Valley stuff. (He was suggested by
| Twitter.) Some of his tweets were a little, let's say, not
| grounded in reality, but I'm not on Twitter to pick fights in my
| legal name. But I am not surprised he turned out to be a scammer.
| g-w1 wrote:
| The Recurse Center[1] is the opposite of this. They don't take
| any of your income, they just help you find jobs and companies
| pay them to find cool people. And there is no curriculum. They
| believe that if people work on cool things they will learn a lot.
| I can't recommend it enough!
|
| [1]: https://www.recurse.com/
| internetter wrote:
| RC is not a bootcamp: https://www.recurse.com/not-a-bootcamp,
| so it's not at all comparable to this program
| BlackjackCF wrote:
| Yeah I always thought RC was like a writer's retreat... but
| for software.
| noufalibrahim wrote:
| The "no curriculum" style automatically filters for a certain
| kind of self learning high achieving student. This is a
| reasonably guarantee of success and also limits the scale of
| the operation.
|
| Lambda School is more of an attempt to train the average guy
| who wants to increase his earning ability. He doesn't have the
| time or patience to "work on cool things" in the hope of
| "learning a lot" which is loosely correlated to finding a good
| job.
|
| They cater to different crowds and solve somewhat different
| problems.
| not_wyoming wrote:
| +1 to this. I attended RC in winter of '18. It wasn't the best
| fit for my personal learning style, but it's an incredible
| program for the right person.
|
| I highly, highly recommend it to anyone considering going
| there. Some of the kindest and smartest people you'll meet.
| jdp23 wrote:
| Paul Graham, 2020: "Lambda School will teach you programming
| faster than most colleges. And it not only works well remotely,
| but was designed to from the start." [1]
|
| Paul Graham, 2022: "Of 1277 students who graduated from Lambda
| School in 2020 and sought jobs, 950 got them, for a placement
| rate of 74.8%.
|
| (Lambda's weirdly dedicated haters will be happy to hear that
| these numbers were audited by an accounting firm.)" [2]
|
| [1] https://twitter.com/paulg/status/1254809755681525762
|
| [2] https://twitter.com/paulg/status/1254809755681525762
| zakary wrote:
| Having something audited by an accounting firm doesn't make me
| trust the numbers much more. It's well known that many
| accounting firms will give you whatever result you want as long
| as you pay enough
| Atotalnoob wrote:
| I'm sure the CFPB is taking action based on haters....
| ec109685 wrote:
| The "who sought jobs" is doing a lot of work in that sentence.
|
| Need to know number of people who started program and number of
| people who got jobs at the end.
| ron22 wrote:
| Vincent Woo in 2020: "Lambda has claimed a 86% student placement
| rate for years. The real number is probably about 50%." [1]
|
| From the announcement: "BloomTech and Allred lured prospective
| enrollees with inflated promises of job-placement rates as high
| as 86 percent, when the company's internal metrics showed
| placement rates closer to 50 percent and in some cases as low as
| 30 percent."
|
| Bravo Vincent!
|
| [1] https://twitter.com/fulligin/status/1230152732809392133
|
| [2] https://nymag.com/intelligencer/2020/02/lambda-schools-
| job-p...
| akanet wrote:
| Thanks
| ji_zai wrote:
| I believe the underlying cause is that the pay-to-learn model
| itself is not feasible because the value of a good teacher's time
| cannot be compensated without charging students and ridiculously
| high fee, and a student can't justify a high fee when the
| outcomes aren't guaranteed.
|
| Colleges have worked in the past because the outcomes were more
| or less guaranteed (i.e. if you got good grades and graduated,
| you would very likely land a job), but even that is no longer
| valid (outside of regulated domains like medicine, law, etc.).
|
| I predict we will see many, many more pay-to-learn companies,
| institutions fall in the coming years. ("fall" could also mean
| become irrelevant, and catering only to those that don't
| understand how the world has changed and still incorrectly think
| that such programs will prepare them well).
|
| BloomTech, in order to survive, had no choice but to try and play
| the games they did, and mislead. It's a byproduct of not having a
| business that is viable.
| paulddraper wrote:
| That, plus there is an extremely strong negative select for
| coding bootcamps.
|
| Your local community college could have the best program ever,
| but they won't beat Ivy League grads, purely because of the
| inputs.
| ji_zai wrote:
| Absolutely. Higher quality inputs actually reduces the
| forcing function for the education to be high quality - since
| you'll get good outcomes anyway.
| fuzzfactor wrote:
| >reduces the forcing function for the education to be high
| quality
|
| Not just the education, but the selection process too.
|
| If the higher-quality inputs are abundant, then the overly-
| exclusive selection process is somewhat deleveraging of
| overall potential.
|
| If the higher-quality inputs are scarce, they are
| outnumbered by others having average-to-below-average
| potential, who often seek the exclusive membership more so
| than any actual high-quality performance.
|
| Once again a large percentage of the highest-quality inputs
| can be systematically excluded in a disadvantageous way.
|
| With good fortune at least a good number of high-quality
| inputs do gain entrance and it can set a good example,
| sometimes realistic, sometimes not.
|
| Either way the higher-quality inputs are best identified
| beforehand, not the result of an overly exclusive selection
| process.
|
| But it's this type selection process that contributes so
| much to some institutions' perceptions of quality, when
| they could be doing so much more.
|
| From the least-prestigious programs all the way up to the
| most-prestigious, it seems like there is always going to be
| some temptation to blur the distinction among peers and
| tiers in a way that's confusing to students, and it's just
| a matter of integrity whether that is taken a bit too far.
| mathattack wrote:
| He seems like someone who fell in love with the persona of being
| an entrepreneur rather than someone committed to their students
| and the work.
|
| I'm surprised they survived their first brush with the law. Can
| they possibly survive this? Looks like the persona is still
| active and in denial.
| jcryzu wrote:
| The cash penalty, $164K is an insult to justice
| hackerlight wrote:
| > Allred tweeted that the school achieved a 100 percent job-
| placement rate in one of its cohorts, and later acknowledged in a
| private message that the sample size was just one student.
|
| This is shameful behavior. And to think prominent people were
| propping him up after so many stories had already come out, all
| in the name of not cowing to the mob. They all have figurative
| blood on their hands, and I already know they won't be
| apologizing to the affected people.
| jerrygenser wrote:
| PG tweeted today in support, kind of:
| https://twitter.com/paulg/status/1780897522778554841
| nickzelei wrote:
| When do the enforcements go into effect? My wife went through
| Lambda in 2020 and still is being hounded by them even though she
| does not work in a related field. Has to prove salary, show
| statements, etc. Does this mean she no longer will need to do
| this?
| VirusNewbie wrote:
| Do they investigate public schools that engage in similar
| behavior???
| effingwewt wrote:
| Oh yay! Is Allred in the comments lying as per usual?
|
| Bout damn time.
| bshanks wrote:
| I don't understand why an Income Sharing Agreement would be
| classified as loans. They seem more like equity than debt; the
| amount that students would pay depends on their future income,
| and can be arbitrarily small or large (right? or maybe I am
| misunderstanding the terms of these agreements).
|
| I had thought that debt is when you have to pay back at least the
| "principal" no matter what, and equity is when the financier
| shares the risk of you failing. Maybe that's not correct, though?
|
| Does the definition of a "loan" include any sort of financing,
| even if the amount that needs to be "paid back" to the "lender"
| can be arbitrarily small or large? That would make equity
| financing a special case of debt.
| nusl wrote:
| You'd probably need to read the contract they make folk sign to
| get a real idea of why. It could be that the contract
| structures it like a loan.
| inopinatus wrote:
| You can't hold equity in a person, because that is slavery. All
| consumer liabilities are thus a form of debt. The
| characteristics that matter most are whether it is secured, the
| schedule of repayment, and the schedule of fees (interest being
| amongst the fees). Everything else is window dressing after
| those three parameters, and the label you stick on the box
| matters the least of all. Consequently, undischarged debt is
| indistinguishable from a loan, which is rather the CFPB's
| point.
|
| When push comes to shove, the substance of a thing matters much
| more than the attempt to relabel the thing.
| beej71 wrote:
| (There was a cap on the ISA, so it wasn't arbitrarily large,
| but your points still stand.)
|
| I was thinking the same thing. "Can you have a loan without
| principal?"
|
| But reading through the documentation on this case, it seems
| like the legal answer is that you can.
| KnuthIsGod wrote:
| ". The CFPB found that BloomTech and Allred falsely told students
| the school's "income share" agreement contracts were not loans,
| when in fact the agreements were loans carrying an average
| finance charge of around $4,000. BloomTech and Allred lured
| prospective enrollees with inflated promises of job-placement
| rates as high as 86 percent, when the company's internal metrics
| showed placement rates closer to 50 percent and in some cases as
| low as 30 percent. "
| sensanaty wrote:
| If my math is correct, they scammed roughly $44M from ~11000
| people... And the fine is somewhere around $150k? In what
| universe is that an acceptable punishment? Whoever is running the
| show here should be thrown to rot in jail for the next few years,
| not this love-tap they're getting.
| ack_inc wrote:
| I'd say your math is wrong. Only a small % of the 11,000 people
| are going to agree they were scammed.
| Kalium wrote:
| The fine is not the punishment. The bans are the punishment.
| They gut the business model, likely shutting down the business
| entirely in short order.
|
| Making people whole is what civil lawsuits are for. Which, if I
| understand correctly, will be much easier with this order and
| findings in place. _That_ will be some serious financial
| punishment on top of the ban.
| justin66 wrote:
| Unrepentant as always.
|
| _We decided to settle the matter because it was clear that
| ongoing litigation would be extremely time consuming, incredibly
| expensive, and distract us from our core mission._
|
| _We do so without agreeing to or denying any of the allegations
| in the consent order._
|
| https://twitter.com/Austen/status/1780770303406403701
|
| Weird to read further down the thread, where he acknowledges the
| wording of the press release is legal bullshit, and then employs
| an entirely different set of weasel words. I can't even sum this
| up.
| diyftw wrote:
| > I can't even sum this up.
|
| As is the intent with most serial liars, no? Twist you up so
| bad that it quite literally jams up your reasoning ability,
| making you more susceptible to the con.
| de_nied wrote:
| https://www.ycombinator.com/blog/a-cs-education-thats-free-u...
|
| YCombinator >.>
| not_wyoming wrote:
| /Years/ ago, I tweeted something about how companies like Uber
| and Lambda were privatizing public services. ISAs specifically
| seem like a privatization of taxes.
|
| Austen Allred quote-tweeted me to his gazillion followers and
| caused a big pile-on about how awful and wrong and anti-progress
| I was.
|
| Couldn't happen to a nicer guy.
| chamomeal wrote:
| I'd be interested to read a post/article about the
| privatization of public services
| dukeyukey wrote:
| If you look at the founder's backgrounds it makes this seem all
| the more likely.
|
| Before BloomTech, Austen was a develop for a payday loans
| company. His cofounder, Ben Nelson, worked as a software
| instructor, and left BloomTech in 2021. So maybe it's less
| surprising that the innovation here was in the financing, not the
| teaching.
| Taylor_OD wrote:
| Bootcamp outcomes reports are always bullshit. I used to work at
| a bootcamp and spent a few days digging into popular bootcamp
| outcome reports. Basically they all wittle down the qualifying
| students per graduating cohort until they have a good number.
|
| Reasons to eliminate a student from your outcomes report: 1.
| Didnt finish the program 2. Didnt complete "career commitments"
| aka xx number of applications per week, x number of meetings with
| career counselors per week, responding to all emails from
| bootcamp within x days - for 6 months to 1+ year 3. Didnt pay
| tuition or missed a tuition payment 4. Had too many absences
| during the bootcamp 5. Received a job offer but turned it down 6.
| Accepted a job offer that wasnt tech related 7. Graduate just
| doesnt respond to outreach from bootcamp
|
| The 30%-50% actual placement rate is pretty realistic. I later
| went through the same bootcamp I worked for and my graduating
| cohort was probably 30% to 40%.
| generativeai wrote:
| austen was one of paul g's favourite ceo
| benced wrote:
| I don't think the core model was crazy, you just have to actually
| deliver value. They didn't and I'm glad they're being punished
| for it.
|
| So many people like to do fake work instead of real work,
| including people who scoff at fake work.
| peripitea wrote:
| Yeah it's really hard in both this article and the comments to
| tell what was actually problematic and what wasn't. A lot of
| people seem to think ISAs are fundamentally problematic but
| none of their arguments seem compelling to me. It's not even
| really clear to me that they did/didn't deliver value. I'm
| assuming some of this is true, but hard to tell how much -- the
| CFPB isn't really giving sufficient details to know how much of
| what they're saying is true in spirit vs legally true political
| posturing. Regardless, I'll be cautioning anyone who asks me
| for bootcamp recommendations and is considering BloomTech.
| dogman144 wrote:
| Good!
|
| I was involved deeply in tech career volunteering several years
| back when this was called Lambda school.
|
| Writing was on the wall about Lambda even then based on student
| feedback from a 100+ student multi year sample size in the orgs I
| helped.
|
| Consistently students raised: ISAs coming to much larger payments
| than advertised. Constantly changing curriculum. The classic one
| for bootcamps - blind leading the blind with former students
| teaching the always changing curriculum, and juicing graduation
| employment stats. If I recall I even broke out the ol' discounted
| cash flow math with students to actually sort out what the rate
| lambda was getting on these ISAs, and ya it was payday loans
| basically.
|
| But, we saw justification after illogical justification about
| this setup. Former students employed by lambda getting
| aggressive. otherwise pretty well-meaning groups who had
| vendorized tech career support partnering with Lambda, despite
| seeing the same feedback as I did bc the company leads were in
| the same groups as I was.
|
| Takeaways from all this if you or people you care about are
| trying to use these conduits to build a tech career and are
| evaluating options like Lambda vs a degree and so on:
|
| - market can stay illogical, and same with its supporters, longer
| than when good, clear as day data about fraudulent (or more
| politely "very obscure and novel pedagogy approaches") practices
| surfaces to counteract that narrative.
|
| - people and orgs who have staked their future on that
| illogical/fraudulent market will roast their reputations in face
| of that evidence for much longer than you think or respect
|
| - the feedback that matters should be the primary sources: the
| students that since 2019 or so started pointing out all these
| practices in bulk.
|
| It is now 5 years later and who knows how many students who
| shredded their career goals by depending on schools like this.
| pc_edwin wrote:
| CFPB needs to be burned to the ground. How tf is this even
| constitutionally legal?
|
| It doesn't matter what your political leanings are or what you
| think about the matter at hand. No agency should have the much
| power to be the judge jury and executioner. Oh and also to just
| write laws at a whim.
|
| This is really not cool. I have no idea how anybody who calls
| them selves an American can be cool with this.
| lowercased wrote:
| _YEARS_ ago (2002? 2003?) I 'd done some tech training courses in
| my town. "Learn web dev" kinda stuff. Was very much a part time
| thing, but I'd looked in to "hrm... could I make this a
| business?". And learned about the numbers... and learned about
| ISAs. If I could get accredited(?) as a certain type of school, I
| could deal with ISAs with students.
|
| I kept looking at the numbers, and couldn't find a way to make
| this be ... profitable. The time it would take for competent
| professionals to spend adequate time with folks wasn't something
| most people could really afford. So... either get them to take
| out loans, or do an ISA. Neither of those seemed to make sense
| for the types of students who might most need this, and... it
| just left a bad taste in my mouth. I enjoyed the teaching part,
| but couldn't find a way to make it a good business.
|
| Then years later I started seeing all these bootcamps charging
| thousands and thousands for what seemed to be garbage (mostly).
| Left another bad taste in my mouth.
| game_the0ry wrote:
| Man, I have so much to say about this...where do I even begin.
|
| I attended a bootcamp myself (hack reactor). My experience
| overall was very good and I owe my (6 figure) income and current
| career to it - the students and instructors were both impressive.
| I was in a dead end career and now I have a new world opportunity
| opened up to me.
|
| But that being said...
|
| I think a couple of things killed the bootcamp model:
|
| - Saturation. Insatiable student demand + no acceptance criteria
| (anyone can get in) means there is robust market for bootcamps.
| Hack Reactor (and a few others, like Fullstack Academy and App
| Academy) mitigated this somewhat bc you needed to pass a
| (difficult) interview to get accepted.
|
| - Fraud. Bc there is no "accreditation" so anyone could star a
| bootcamp, including scumbags.
|
| So I have mixed feelings.
|
| Hopefully, the (terrible) job market will flush out some of the
| shit down the toilette, but I hate that innocents, people just
| trying to improve themselves, got caught up in the blast radius.
| fakeart wrote:
| Don't try to disrupt higher ed. They are the federal government
| for all intents and purposes. You will be the one who gets
| disrupted.
| jerrygenser wrote:
| YC backed company: https://www.ycombinator.com/companies/bloom-
| institute-of-tec...
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