President of United Education & Software Inc. Resigns

United Education & Software Inc., the parent of embattled trade-school operator United Education & Software, which filed for Chapter 11 bankruptcy reorganization last December, said Aaron Cohen resigned Friday as president and chief executive officer.

Cohen was replaced by United Education’s chairman, Stanley R. Schoen.

Cohen also announced plans to resign as president and chief executive of the company’s subsidiary, but that must be approved by the U.S. Bankruptcy Court, the company said. Cohen will remain on the boards of directors of the parent and subsidiary and will serve as a consultant to both.

United Education’s troubles started in 1988 when a government probe uncovered major foul-ups at its former student loan-processing subsidiary, including failure to notify delinquent borrowers.

Last year, its problems mounted when the California Student Aid Commission, the state agency that administers the federal student loan program, responded to a federal audit that found widespread mismanagement at one of United Education’s schools. As a result of the audit, it said the school should be banned from the loan program.

Facing several lawsuits, including a $24-million suit filed by the state of California, United Education filed for bankruptcy protection Dec. 4. Since then, the firm has sold or closed 12 of its 26 trade schools and closed its Encino headquarters. The company is now run from one of its schools in downtown Los Angeles.

C. Ronald Kimberling, United Education’s executive vice president, said that since the bankruptcy filing, Cohen has been involved primarily with the company’s reorganization plan and has removed himself from involvement in day-to-day operations. “He just felt it was time to step back,” Kimberling said.