“I Can Turn Anyone Into A Successful Real Estate Investor, Including You.” -Donald Trump With these words, Donald Trump lured consumers to Trump University, believing that they could become successful real estate investors. Between 2005 and 2010, Trump University operated as a real estate investment training program that charged students between $1,500 for a three day course to $35,000 for an “Elite” experience. In advertisements, Trump University promised that students would learn from Donald Trump’s “handpicked experts”, who Trump himself described in videos as “terrific people, terrific brains, successful, the best.” For many students who attended Trump University, these promises went unfulfilled. As a result, two class action lawsuits were filed in California Federal Court and one lawsuit was filed by the Attorney General of New York, on behalf of thousand of students. Low v. Trump University, LLC, filed in the U.S. District Court for Southern California, was a class action suit that alleged that…Read More
For-profit colleges often advertise and recruit students with a message of hope. That is, these colleges show commercials about hard-working people with children who had better lives and were better able to provide for their children after graduating. In addition, for-profit colleges have gotten in trouble, like DeVry, for advertising false statistics to back up their claims. A recent study conducted by the Center for Responsible Lending examined the student loan burden of college students in Maine. The result? For-profit colleges target lower income students and put them in heavier debt than other colleges. The study examined students in 39 colleges in Maine: 15 public non-profit colleges, 13 private non-profit colleges, and 11 for-profit colleges. Based on the demographics and debt loads of over 56,000 students that populate those colleges, the study found the following: That for-profit colleges disproportionately disadvantaged students who were low-income, female, and African-American. The report revealed that for-profit colleges “targets” low income students…Read More
University Of Phoenix Targeted The Military In June 2015, a investigative story broke that the University of Phoenix was making payments of $250,000 per year to the military for access to military bases. What was the University doing there? They were holding recruiting fairs and other activities with the purpose of convincing active military members to enroll at the University of Phoenix. The reason they were doing this is because of a loophole in the “90/10” law, which allows for-profit colleges to double dip into federal funding when they have access to a military member’s G.I. Bill benefits. Basically, there is an enormous financial incentive to target military members. In fact, as of 2015, University of Phoenix was the nation’s most prolific beneficiaries of G.I. Bill money, collecting over $1 billion since 2009. University Of Phoenix Lives Off Federal Money Beyond military benefits, University of Phoenix makes its’ primary living from Federal student loans. Before…Read More
When President Trump was elected, advocates of for-profit college regulation were concerned about his plans for the Department of Education. Their fears were realized when he nominated Betsy DeVos as Secretary of Education and had a “listening session” with colleges like DeVry. Adding further insult, in March 2017, President Trump (who was also the namesake of Trump University) took steps to roll back Obama’s protections for students in default on their student loans. Bible V. USA Funds, Inc. During the Obama administration, the Seventh Circuit Court of Appeals considered the case of Bryana Bible. Ms. Bible took out a student loan in 2006. Six years later, she defaulted on the loan and entered into a rehabilitation agreement with USA Funds, a student loan company. Despite their agreement and her compliance with her payment plan, USA Funds assessed a $4547.44 collection costs on Ms. Bible. When Ms. Bible appealed the case to the Seventh Circuit, the…Read More
During President Obama’s administration, numerous for-profit colleges, like ITT and Corinthian College went out of business due to increased Federal regulations and fewer students enrolling. This trend was put on hold with the election of President Trump, who has virtually eliminated President Obama’s regulations. As a result, massive for-profit colleges like DeVry are now seeing their stock prices skyrocket. Despite this, Westech College, a for-profit trade school in California, closed its doors in early April. With locations in Fontana, Moreno Valley and Victorville, Westech offered numerous trade degrees, such as HVAC service, computer systems service, and medical and veterinary assistant programs. The closure of the schools was unexpected to its 500 students and its faculty alike, many of whom came to school on a Monday morning to simply find the buildings locked. One teacher told the Fontana Herald News that “All this time, [Westech] kept us in the dark; they didn’t tell us anything.” In…Read More
The Consumer Financial Protection Bureau (CFPB) is a government agency tasked with protecting consumers in matters related to misconduct by businesses in the financial sector. This generally means unlawful acts involving mortgage loans, credit cards, retirement and insurance policies, and student loans. Among the powers of the CFPB is to issue broad administrative subpoenas during its investigations. One of these subpoenas was issued in 2015 to the Accrediting Council of Independent Colleges and Schools (ACICS). The ACICS is an organization that since 1912, has granted accreditation to for-profit colleges. This means that it was supposed to ensure that these colleges met admissions and academic standards, that they were financially stable and that their students stayed at the college and graduate. It was also supposed to monitor job placement rates and ensure that students had positive outcomes after spending the time and money to complete college. ACICS Has Been Under Fire For Years Unfortunately, the ACICS…Read More
Part of the American dream for many families is going to college or sending your children to college for the chance at a more prosperous life. The unfortunate reality for many people is that college is simply unaffordable, unless they want to take on a giant student loan. Did you know that over the last 45 years, the median income for a household has only increased about 10%, while the cost of attending a public college has increased by 530%? The math simply doesn’t work out. Current legislation before the California legislature is attempting to bring attention to this problem and offer a chance at free tuition for California residents. Titled “Renewing the California Dream”, Assembly Member Susan Eggman has filed Bill 1356 with co-authors Shirley Weber and Rob Bonta. This bill proposes to add a 1% tax to all households with incomes higher than $1 million. This money, about $2.2 billion total, would go…Read More
College is supposed to be an exciting time. We have been taught our entire lives that in order to make more money and provide a better life for ourselves and or families, we should go to college. In other words, if we dedicate ourselves and work hard, we can improve our situations. It is the American way. Unfortunately, as attorneys at Moss Bollinger, we have seen that some colleges are far too eager to prey on people who are just trying to get ahead in life. There are numerous ways that for-profit colleges have been demonstrated to mislead prospective students. The most glaring is by spending millions of dollars advertising promises of better, higher paying jobs if you graduate from their college. Do you remember DeVry’s advertisements of a 90% job placement rate and 15% higher salaries? Those misleading advertisements cost them $100 million after the Federal Government sued them to stop. In addition, some…Read More
For-profit colleges have had a controversial history since their numbers exploded following World War II. Soldiers had just returned from war and the Federal government had established the G.I. Bill to provide money for soldiers to go to college. This had many people seeing dollar signs, and many “fly-by-night” for-profit colleges opened and closed, stealing hard-earned military benefits and leaving veterans with nothing to show for it. For-profit colleges are still around today, and remain controversial due to allegations of false advertisement of job statistics and predatory recruitment and lending practices. With this history in mind, it has surprised many that Purdue University purchased Kaplan University. For those unfamiliar, Purdue is a well-respected public non-profit university. Kaplan is a for-profit college with fifteen campuses that primarily focuses on offering online classes. For Purdue, the move represents an effort to diversify from physical campuses and gain a greater foothold in the market of online colleges. University…Read More
Earlier this year, a former employee of a Nike store in San Clemente, California, filed a legal complaint against the company, alleging a number of labor law violations. In the weeks since, the scope of the case has quickly expanded; Nike now faces a class action suit that could include all current and former nonexempt employees who worked in California-based Nike retail stores in the last four years. Were Employees Making Less Than Minimum Wage? The legal proceedings began in February, when a former worker noted that Nike failed to provide itemized wage statements and did not adequately inform employees about their sick leave policy. Yet the lawsuit has come to center around the issue of employee uniforms. Namely, the plaintiffs claim that store employees were required to buy new uniforms roughly four times a year, so that the clothes they wore to work reflected Nike’s most up-to-date retail offerings. Many of the affected employees…Read More
