One of Australia's largest vocational education providers, Careers Australia, has been placed into voluntary administration with up to 1,000 staff members stood down immediately without pay.

Classes have also been cancelled for 15,000 students at 14 campuses across the country.

Late on Thursday night, voluntary administrators David McEvoy and Martin Ford of PPB Advisory sent a letter to all staff which has been obtained by the ABC's 7.30 program.

"We do not currently have sufficient funds available to meet payroll and other costs which would allow us to continue trading the Group on a 'business as usual' basis," the letter read.

"Accordingly, we hereby confirm you are stood down effective 25 May 2017 whilst we undertake an urgent assessment of the Group."

Students were sent a text message at 10:45pm which reads, "All activities of Careers Australia Group are suspended. No classes, no workplaces effective immediately. Further information will be provided."

Loading

At its height, Careers Australia was raking in hundreds of millions of dollars in taxpayer funding for expensive training courses.

But a series of investigations by 7.30 revealed the company was targeting vulnerable students using door-to-door sales brokers offering so-called free computers as inducements to sign up.

When that sales tactic was banned by the Federal Government, Careers Australia allegedly moved to telemarketing, online competitions spruiking free iPads, and employment websites to obtain people's contact details without their knowledge.

The company denied that people were unaware they were passing on their personal information or that it was engaged in cold calling.

The voluntary administrators are David McEvoy and Martin Ford of PPB Advisory.

Careers Australia excluded from new VET scheme

One of Careers Australia's promotions. ( Supplied )

Last month, in a major blow the Federal Government denied the provider access to its new vocational education scheme because of its poor track record, which included the company admitting to breaking consumer law.

7.30 understands Careers Australia appealed the decision but its appeal was rejected, prompting the collapse.

Do you know more about this story? Email 7.30@abc.net.au

Speaking on the condition of anonymity, a Careers Australia employee said they were furious.

"I'm angry for the staff who have worked so hard, but especially for the students who don't know what's going to happen to them," the employee said.

"It was awful having to tell them the news today."

In a statement, the Federal Education Department said it stood by its decision to refuse Careers Australia's access to the new education scheme based on concerns over the provider's financial performance, governance and poor student outcomes.

The Department advises concerned students to continue studying as normal until the administrators make a final decision about the future of the business.

'We've been misled,' says employee

The employee accused senior management of keeping the financial woes secret from staff.

"We were told it was business as usual at every meeting before this. That's been the company line," the employee said.

"[But] we've been misled. Somebody knew this was coming and they didn't give us any warning."

The staff member claimed they were told by Careers Australia it was up to administrators to decide whether they continued to have jobs, and they should continue to come in to work as normal.

"That's what they're feeding us, but it's a pile of rubbish that it's business as usual, I won't be doing that," the employee said.

In a statement, Careers Australia blamed the Federal Government crackdown on the sector for its financial crisis.

"Regrettably, due to a number of changes in the education sector, we have had to appoint voluntary administrators.

"We are very disappointed that the business has had to make this decision, particularly for the 1,000 staff and 15,000 students affected."

Students can contact Careers Australia's Tuition Assurance provider TAFE Directors Australia on 02 9217 3180 or the Department on 1800 020 108.