For-Profit College Marketer Thrived By Posting Fake Ads To Popular Job Sites
Neutron Interactive, a Salt Lake City-based business, regularly posted fake job listings on popular job websites including Monster.com and CareerBuilder.com for the purpose of tricking job-seekers into visiting its own websites, according to former Neutron employees. These Neutron Interactive websites, still operating today, also promise jobs, but in reality they usually offer none; their real purpose, say these former employees, is to convince visitors — low-income people, single mothers, veterans, the elderly, all in desperate need of jobs — to provide their cell phone numbers, so marketers at other companies, which pay Neutron for the leads, can sell them overpriced for-profit college programs.
Neutron Interactive’s website highlights the company’s membership and active participation in the for-profit colleges’ main trade association, APSCU. Until last week, Neutron bragged on its site that “Some Of Our Biggest Fans” include Corinthian Colleges’ Everest University, EDMC’s Art Institutes, and Bridgepoint’s Ashford University — all major for-profit colleges. After I pointed out this boasting out in an article, it has apparently disappeared from the Neutron site, but as of today, Neutron is still listed by APSCU as one of its members.
With APSCU leading the effort to overturn the Obama Administration’s “gainful employment rule,” and with the collapse of Corinthian raising issues about how to protect students when predatory for-profit colleges fail, it’s crucial to understand that this industry signs up many of its students through blatant deceptions.
Such deceptive strategies have helped turn Neutron Interactive into a lucrative “lead generation” company and made its founders wealthy, according to the former employees. But Neutron had to regularly change its tactics, the employees say, as the legitimate job websites and other businesses recognized the scams and shut them down.
Recently I reported on how at least some of the visitors who entered their contact information on Neutron Interactive sites, and at similar bait-and-switch sites offering food stamps and Medicaid, were promptly contacted by workers in a call center operated by another business, called EdSoup, also located in Salt Lake. About 95 percent rejected the EdSoup pitches to discuss college programs, but the remaining 5 percent were passed on to another layer of call centers operated by or for for-profit colleges, including the University of Phoenix, Brown Mackie, Everest, Colorado Tech, IIT Tech, and Kaplan. EdSoup employees who worked at the company until earlier this year gave me the scoop on this shameless, deceptive operation, and backed it up with documents.
Within 90 minutes of my posting that story on Republic Report and The Huffington Post, the Neutron site I described, localemploymentnetwork.org, had been shut down. Perhaps a coincidence, or perhaps some concern about suggestions I made that the Neutron and EdSoup operations might be violating federal and state laws. The next day I posted again, describing other similar sites apparently run by Neutron. Those sites are still online at this writing.
Now, three former Neutron Interactive employees have come forward to tell me more about Neutron’s piece of the shady world of for-profit college lead generation. Neutron’s operations were “wrong — illegal and immoral,” says a former Neutron manager.
Two of the employees, the former manager and an early tech hire of the company, asked me to not use their names, citing concerns about retaliation. The third, Jason Gill, a former senior web developer at Neutron, was ready to be on the record. The accounts of the three employees were consistent — and disturbing.
Neutron’s founder and CEO Dan Caffee and its co-founder and partner Shaun Ritchie have not responded to my requests to discuss their business.
How the scam worked
How does APSCU member Neutron Interactive operate and serve the for-profit college sector? The former Neutron employees laid it out for me.
The biggest question I had after my previous reports was: How do job-seekers end up at these scam websites in the first place? Google search has gotten smarter over the years, so that all the search engine optimization (SEO) techniques in the world can’t normally draw search users to websites that deliver no actual content.
But Neutron had other schemes to pursue.
The former tech employee joined Neutron at its start in 2008. Neutron’s founders had presented the firm as a marketing and advertising company, but, once hired, all the tech employee was asked to do was build landing pages — the fake job sites, with stock photos of smiling nurses, police officers, and office workers. New sites all the time — if one didn’t perform well, it was quickly taken offline and another one built. The Neutron landing pages in fact offered no actual jobs. Eventually, this employee “got curious — why are we doing this?” and started digging around. Soon it became clear: Neutron was trying to find visitors for the purpose of “suckering them in to applying for for-profit colleges.”
To satisfy their curiosity, Neutron employees listened to call centers, operated by other companies, trying to sell college programs to Neutron leads, and, says the tech employee, “it was just sickening” — vulnerable people facing a multi-stage process of deception. The call centers were “preying on people who were desperate” and pushing them to colleges that would make them “worse off than when they started” with “insane amounts of debt…. A guy said, I just lost my job, I haven’t had a job for three years, I’ve looked everywhere. And the rep says, well, you can get a job, and there is opportunity — playing off the guy’s emotions — for people like you with no other options, here are some college training programs you can attend.”
Neutron sold some of its leads to call centers like EdSoup, whose telemarketers would screen the leads for for-profit colleges. Neutron employees said Caffee sometimes visited another company’s call center in the Salt Lake area — perhaps the EdSoup office.
EdSoup reps tell me they would hear from 19 out of 20 people called that they had no interest in college programs. The one in 20 EdSoup targets who was interested would then get called by the colleges directly.
But Neutron had a strong incentive to cut out middlemen like EdSoup and sell leads directly to colleges. The colleges were paying lead generators like Neutron $30 to $60 per lead. EdSoup was paying Neutron just $1 to $2 per lead. So Neutron was selling some leads directly to colleges including University of Phoenix, EDMC, Corinthian, Bridgepoint, Kaplan, ITT, and Daymar, according to the former Neutron manager.
But the former employees say the for-profit college industry was scrutinizing Neutron for the quality of its leads. So many of the prospective students whom the colleges reached through Neutron leads would say, why are you calling me? I was looking for a job, not college.
The former tech employee believes the client for-profit colleges knew that Neutron was engaged in improper tactics, but “the schools turned a blind eye.” The employee added: “I think for-profit schools are just the devil, because they want to play off the deceptive tactics [of lead generators]…. I didn’t know that the University of Phoenix was a bad deal until I went to work at Neutron.”
The tech employee eventually learned how Neutron was attracting people to its sites. Neutron had hired and fired a number of search engine optimization specialists, but SEO didn’t succeed in getting the company’s scam sites high in search engine rankings. They tried paid Google ad words, but that produced a poor return on investment.
What was working, was this: Posting listings for generic jobs — like dental assistant — on Monster.com, with a link to a Neutron fake jobs site. None of the jobs listed actually existed, and the Neutron site offered no links to jobs, or it just scraped unrelated job listings off legitimate job sites.
Getting caught, but getting rich
The fake ads leading to the fake sites became Neutron’s “cash cow,” according to the former tech employee. But it required Neutron to move the ads around.
Monster got wise to the scam, and didn’t want its site polluted with fake listings, so it banished Neutron from its site.
Neutron started posting its fake job listings on another job site, Indeed.com, “but,” says the former tech employee, “as soon as they figured out what we were doing, they kicked us out.”
Neutron also was posting its fake ads on CareerBuilder, according to the former manager, until CareerBuilder, like Monster and Indeed, kicked Neutron off. Job seekers had been complaining to CareerBuilder about the fake Neutron listings.
Neutron had to keep “scrambling” to find job sites where it could post its fake ads before it got banished, according to the former manager. It was a constant cycle of getting caught and moving the scam down the road.
Caffee told the tech employee not to divulge to others in the industry how Neutron got its leads.
But Neutron did keep finding new places to post its fake ads, and the effort was thriving. Millions in revenues were coming in. The office actually had a giant ticker updating its revenues on an ongoing basis. Early on, the ticker lit up when the company reached a million dollars in a single month.
The profits seemed to make Neutron’s founders rich. Caffee had a big house, a Jaguar, a Land Rover. He traveled on private jets, taking regular trips to Las Vegas. Caffee, according to the former employees, was frequently on vacation, and his Instagram page shows a love of travel and lavish leisure.
Neutron overcame employee misgivings with creature comforts. The former manager said that Caffee “wanted it to be a fun, cool place to work.” The tech employee said, “Neutron was like [the movie] “Fight Club” — you don’t talk about Fight Club. They spoil you — catered lunch very day, free snacks, everyone got an iPhone and an Ipad right away. We will spoil you, and you don’t question.”
Trying a new direction ends in mass firings
People who did question the company’s approaches or ethics, the tech employee says, got fired, or quit. If they went along, they got promoted.
Eventually, the tech employee told Caffee that the situation was untenable: “I gave him an ultimatum” to change things, “or I quit.” Caffee responded that he would try to make changes, but when that didn’t happen the tech employee finally did quit.
In August 2011, Neutron had hired a new vice president of marketing who had worked in legitimate staffing companies. The new VP was able to hire about a dozen people, and was told, say the former employees, to develop plans to move Neutron in a more conventional direction.
One of those hired by the new VP was developer Jason Gill. He was told that his job would be to do leads work for job placement. But like the tech employee, Gill was directed to constantly build new landing pages that were more of the same — fake job sites. Sometimes a site would be tried for a day, and if it failed to attract people, dropped right away, and another one built. Gill directed me to 20 more Neutron sites, with names like myjusticecareer.com, healthcareerchoices.com, drivercareers.com, and unitedcareerservices.com. “These are all,” Gill says, “part of the same bait-and-switch network with exactly the same strategy — farm info to sell to for-profit schools.” Some of these sites today still actively harvest the phone numbers of visitors, while others are abandoned shells. Neutron also maintains its own actual college portal site, collegeoverview.com, for people actually looking for college programs; of course, it steers visitors to for-profit colleges instead of more affordable and reputable options.
In this period, Neutron, flush with cash, acquired a company called Talent Base, which it apparently wanted to leverage as part of an effort to build a real job matching site. But the operation had no client employers to list jobs. And Neutron management, when challenged by the new marketing VP, refused to pay to post actual jobs on Neutron’s own supposed job sites.
Eight months after Neutron hired the VP, according to Jason Gill and two other Neutron employees who spoke with me, Caffee directed the VP to fire almost all of his hires — 12 of Neutron’s approximately 45 employees — on a single day. Caffee said that the business model that the VP had sought to deploy wasn’t working. The VP sat in a room and fired employee after employee, handing each a red envelope with information about severance benefits. Then, after the firings were complete, at the end of the day, Caffee and Ritchie fired the VP.
“I was shocked” by the Neutron leaders’ action to fire an executive right after making him fire almost his entire team, said one of the former Neutron employees. “I had never seen or heard of that” in the corporate world before.
Jason Gill was one of the few people hired by the VP who did not get purged that day. But he did resolve to resign, and he did so soon, after just six months with the company and, he says, “all their shady practices.”
Today, Neutron has downsized — fewer employees, a smaller office space. Caffee reportedly is focused on running another business, called JobDash — “The Student Placement Solution.” But many of the Neutron Interactive sites are still live, and still programmed to ask unemployed people to type in their contact information.
This article also appears on Huffington Post.