LOUISVILLE, Ky. -- A financially troubled private trade school, until recently headed by former Massachusetts governor William F. Weld, will enter bankruptcy proceedings and try to pay its creditors.
Weld is seeking the Republican nomination to run for governor in his native New York.
Louisville-based Decker College won't fight a petition by three former employees to force the school into Chapter 7 bankruptcy proceedings, its lawyers wrote in a Nov. 2 court filing.
''We ran out of money," Jeffrey Woodcox, one of Decker's owners, told the Louisville Courier-Journal. ''I don't expect, in dealing with the government, for Decker to survive."
Woodcox said the US Department of Education's move to limit the school's federal financial aid hurt its ability to remain open.
Weld's office could not be reached late yesterday for comment.
For months, Decker has been facing financial and legal trouble on various fronts.
It has been under investigation by the FBI and the US Department of Education's inspector general for possible federal violations, including student loan and wire fraud, conspiracy to commit fraud, and making false statements to the federal government. The education department also said Decker owes $7.2 million.
The state's attorney general's office and the Kentucky Board for Proprietary Education have also been investigating Decker.
Weld was the school's chief executive from January until recently, when he left to focus on his gubernatorial campaign.
A judge last week appointed a trustee to monitor the selling of Decker's assets.
Woodcox defended Decker and said he was not aware of any federal violations.
He disputed an assertion by Decker's accreditor, the Council on Occupational Education, that the school was not approved to offer primarily online trade classes. The education department partially based its financial aid decision against Decker on the council's finding.