Brick Beauty School Agrees To Settlement Over Defrauding Students

BRICK, NJ — Capri Institute of Hair, the cosmetology school that abruptly shut down its locations including Brick in 2021, has agreed to pay nearly $640,000 for defrauding and financially harming students, New Jersey's attorney general said.

The settlement between the state and Capri representatives and the school's related entities resulted from a civil action filed by the Division of Consumer Affairs in June 2022 accusing the company of violations of the Consumer Fraud Act and advertising regulations, Attorney General Matthew Platkin said in the announcement.

The majority of the $640,000 settlement will be used for restitution to the students who were denied tuition refunds when the schools shut down, the attorney general's office said.

Capri shut down its campuses in Brick, Paramus, Clifton and Kenilworth with less than 48 hours notice in December 2021.

After the shutdown, Capri refused to respond to students’ questions about the closure and refused to provide students with their official transcripts or tuition refunds, making it virtually impossible for them to transfer to another cosmetology school, the attorney general's office said.

Capri later reopened classroom-based instruction at three campuses, but did not reopen clinics attached to the schools, officials said. That violated curriculum requirements for beauty schools in New Jersey, because students are required to complete the clinical hours to become licensed as cosmetology and hair styling professionals in the state.

Officials said Capri "engaged in substandard business practices that financially harmed students and failed to provide students with Board-mandated books and supplies that were included in the cost of tuition."

Capri also agreed to surrender its licenses to operate in New Jersey in a separate settlement with the State Board of Cosmetology and Hairstyling, Platkin said.

The Division of Consumer Affairs plans to issue cash refunds for students who Capri unenrolled, or who unenrolled themselves, after the school's closure in December 2021.

"Students who were able to graduate will receive partial refunds for the disruption to their education," Platkin's office added.

Additionally, Capri students who borrowed federal student loans to pay tuition, and were affected by the closing, may qualify for a closed school discharge of their federal student loans.

"Capri’s students paid thousands of dollars in tuition, or incurred thousands of dollars in student loan debt, believing they were investing in a brighter financial future," said Cari Fais, Acting Director of the Division of Consumer Affairs. "Instead, Capri defrauded them. The settlements announced today hold the school and its operators accountable for their actions, provide restitution to affected students, and send a clear message that this kind of unlawful conduct will not be tolerated."