Buy Stock in Barrington!

Discussion in 'General Distance Learning Discussions' started by BillDayson, May 17, 2001.

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  1. BillDayson

    BillDayson New Member

    If anyone ever wondered why the dot.com 'tulip mania' collapsed overnight, check out this:
    http://www.virtualacademics.com

    It seems that Barrington University and some of its peculiar cousins have gone public with the ticker symbol VADC.

    I'm particularly impressed by this information from their 'management team' page:

    It then goes on to talk about the other companies he started over that time.

    That would make him 19 years old when he started Virtualacademics.com. According to 'Bear's Guide', Barrington itself was founded in 1993, when Mr. Bettinger was 21. He's not even thirty yet, and he has founded three universities and at least three companies.

    Is this country great, or what???

    Don't waste a minute. Call your broker right now! You want a part of this!
     
  2. BillDayson

    BillDayson New Member

    The beauty of taking a mailbox "university" public is that it makes the books public as well. So let's look around and see what we can see.
    http://yahoo.marketguide.com/mgi/highlights/A2332.html

    OK. VADC closed 5-17-01 at $1.90/share. There are 7,503,617 shares outstanding, giving this thing a market cap of $14,256,872. Of these shares, 52% are owned by insiders, which works out to $7,413,573. We can assume that founder and CEO Steven M. Bettinger owns a significant proportion of this. So taking the Barrington mailbox public made Mr. Bettinger a multi-millionaire.

    What's more, Mr. Bettinger draws executive compensation. For the last fiscal year, Mr. Bettinger's total annual compensation was $133,692. In addition, he collected $250,000 in "other" compensation, for a fiscal year total of $383,692.

    We can all laugh at a 19-year-old starting a business selling non-accredited "degrees". But it certainly seems to have worked out very well for Mr. Bettinger.
     
  3. Bill Huffman

    Bill Huffman Well-Known Member

    Not to really wish Mr. Bettinger ill but his financial success could end up putting him in jail. Crooks are eventually caught is a statement that you hear on occasion. I think it is generally true but less so for white collar crimes like this. Perhaps he'll buy a yacht and spend some time in a foreign country eventually.

    On second thought I've reconsidered and I guess I really should wish ill on Mr. Bettinger if for no other reason than the spam that the fellow has sent to my mailbox. I do believe that he has violated law at least in his unsolicited email SPAM.
     
  4. BillDayson

    BillDayson New Member

    More revelations from what is probably the best documented "less than wonderful" educational establishment on Earth:
    http://yahoo.marketguide.com/mgi/highlights/A2332.html

    In the fiscal year ending June '99, VADC reported revenues of $773,000. In the June 2000 fiscal year, revenues increased to $896,000. And in just the first three quarters ending March 2001, VADC revenues ballooned to $1,899.000. The fake-degree industry seems to be recession-proof.

    In the fiscal year ending June 2000, revenues were $896,000, and Mr. Bettinger's total compensation was $383,692. That works out to be 42.82% of revenue.

    As of 6/30/2000, VADC reported a total of 12 employees.

    Despite this small staff and the large proportion of revenue flowing to the founder/CEO, VADC manages to operate at least nine different operations, at least on paper. (That's 1.33 employees per operation.) There are the eight listed on their corporate webpage:
    http://www.virtualacademics.com/frames/frames_schools2.htm

    These include the Universidad Hispanica de America, at
    http://www.spanishuniversity.edu

    (Karlos will be happy (or perhaps not) to see that our Hispanic brethren have not been forgotten, at least as long as they have money to lose.)

    And there is what is billed as a "bricks-and-mortar" certificate-granting branch of Barrington U. located in Vancouver, Canada.
    http://www.barrington-chinese.net

    This thing has the advantage of allowing VADC's corporate description to claim that Barrington University is recognized by the provincial authorities in Canada. The site itself is clearly aimed at a Chinese student body, and it makes the interesting claim that Barrington is a 'Nasdaq-public' university. Which may be technically true, but it is obviously misleading.

    Both the corporate website and marketguide refer to something called 'cyberuniversity', founded by Mr. Bettinger. But for some reason it has no link on the corporate "schools" page. Well, if you go to the URL buried in the marketguide description:
    http://www.cyberuniversity.edu

    you find yourself at our old friend Alston University, allegedly in Stockton California. I just checked the BPPVE website and Alston is not CA-approved and would seem to be breaking CA state law by claiming to grant degrees out of an address in the state of California.
     
  5. Caballero Lacaye

    Caballero Lacaye New Member


    Hi, there!

    Thank you for your supportive words, Bill!

    All the best,


    Karlos Alberto Lacaye
    [email protected]

    P.S.: I guess that this "Universidad Hispánica de América" has contact addresses in Boca Ratón to target the relatively high Hispanic college population in South Florida.
     
  6. H. Piper

    H. Piper member

    Originally posted by BillDayson:
    The fake-degree industry seems to be recession-proof.

    Probably just the opposite. Morally weak underachievers would want that extra edge of a sheepskin (or in this case, sheepdip) in a more competitive market.
     
  7. H. Piper

    H. Piper member

    Originally posted by me:
    Probably just the opposite.

    Ugh! I shouldn't post this late at night. I meant probably the opposite of being susceptible to recession.
     
  8. Rich Douglas

    Rich Douglas Well-Known Member

    The first paragraph seems to imply Barrington is operating illegally. I don't think that is the case. Amorally, perhaps. But trading degrees for life experience, having unrecognized accreditation, etc. are not illegal, even if the processes are superficial.

    Barrington is licensed in Alabama, so state authorities are fine with them. By sticking to what they say they do Barrington will likely stay clear from Federal scrutiny, too.

    Fourteen million in market cap? Can you imagine what a real school could be worth?

    Is spam itself (not considering content) illegal? Or just bad form?

    Rich Douglas
     
  9. BillDayson

    BillDayson New Member

    Alston doesn't seem to be operating legally in California, and it would be interesting to know the Universidad Hispanica's legal status in Florida.

    But yeah, in general Mr. Bettinger is probably trying to stay just inside the law while making his fortune.

    I'm struck by the fact that this thing went public at all. If VADC is in any way representative of the many tiny dot.com's that were created in the last few years, went public in the tulip-mania phase of e-commerce mania, and then watched their share prices go through the roof, it certainly isn't difficult to see why it all collapsed like a house of cards.

    In VADC's case, it reached a price of over $7/share right after it went public at the beginning of 2000. At $7, that would give it a market cap of $52,525,319. (Not bad for a mail-box.) And keep in mind that more than half the shares are owned by insiders. Unfortunately VADC was down to about $0.50 by the end of the year. It closed at about $1.75 on Friday. So some suckers... oops, investors are still buying it.

    On the other hand, considering the fantastic growth rate in degree mills, and the fact that this is probably the only way for an investor to participate in that high-growth sector, it may not be such a bad idea. Maybe I'd better call my broker...
     
  10. Dan Snelson

    Dan Snelson New Member

    Yes Rich Spam is illegal [​IMG](in California at least) and the use of other companies services to send the spam is stealing also illegal [​IMG].

    Just my nickels worth (they are trying to phase out the penny so...) [​IMG]

    Dan
     
  11. bgossett

    bgossett New Member

  12. Bill Huffman

    Bill Huffman Well-Known Member

    He's obviously attempting to walk a fine line. The question is has the business EVER stepped over the line? My guess is, yes. Will it ever be proven in court? Time will tell.

    I think the unsolicited email spam is illegal. I don't know what, if anything, can be done about it though.
     
  13. Bill Huffman

    Bill Huffman Well-Known Member

    This article seems to indicate that our SPAM artist has stepped over the line into fraud. http://southflorida.bcentral.com/southflorida/stories/2000/10/16/story2.html
    A problem with playing this diploma mill con game is that no matter how careful you want to be, chances are that you'll step over the line at some time or another.
     
  14. H. Piper

    H. Piper member

    Originally posted by Bill Huffman:
    This article seems to indicate that our SPAM artist has stepped over the line into fraud. http://southflorida.bcentral.com/southflorida/stories/2000/10/16/story2.html

    Excellent research, Bill. Just goes to show that if it walks like a duck, and sells degrees like a duck, then...

    (I notice the article pins the WHOIS record for the phony accrediting agency in Sunrise, Florida. Aren't there some other degree mill scammers there, too?)
     

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