What happens when an enormous, national college, like ITT Technical Institute goes bankrupt? Bad things. One result is that former students can apply for federal student loan forgiveness. It has been estimated that taxpayers will ultimately have to pay $500 million because of ITT’s closure. If that isn’t bad enough, former students harmed by ITT’s deceptive practices will have an uphill battle to seek legal recourse against the college. Students Intervene In ITT Bankruptcy Proceedings In January 2017, former ITT students filed a legal intervention into ITT’s federal bankruptcy proceedings. In it, they sought to represent the “hundreds of thousands” of students “defrauded” by ITT. As part of their pleadings, they attached more than a thousand pages of testimonials from former students and whistleblowers. Their remarkable statements were separated by topic, including: An ITT degree was a disadvantage in the job market ITT guaranteed job placement ITT misrepresented job placement and earnings statistics ITT downplaying…Read More
“There are future doctoral dissertations waiting to be written about how and why Democrats and Republicans reversed positions on the merits of the for-profit trade-school sector.” – Charles Kolb, Department of Education Aide under Presidents Ronald Reagan and George H.W. Bush. For the last generation, GOP politicians have been evoking one person as the embodiment of the conservative ideal: Ronald Reagan. Without citing details or facts, politicians – some of whom were children at the time – will make bold claims that their values perfectly align with President Reagan’s. Further, they will harken back to an idyllic time of Reagan’s presidency, then promise voters a return to those times. When it comes to for-profit education, history actually shows that President Trump and the current GOP have taken the exact opposite position of President Reagan. In fact, they are more aligned with the Democratic party through the 1980’s. Background Of The For-Profit College Problem After World…Read More
Were you ripped off by Corinthian College? Were you promised a great education and better job prospects, yet left with nothing but a massive student loan when the college shut down and went into bankruptcy? Unfortunately, you are just one of tens of thousands of students who was defrauded by the for-profit college. But in some rare positive news, you may be entitled to some relief in the form of student loan forgiveness. Corinthian College Found Liable For Defrauding Students In March 2016, Corinthian College, which operated Everest College, Heald College, and Wyotech in California, was found liable for defrauding its students. In the $1.1 billion judgment, the college was found to have: Provided false job placement statistics in its advertising. Advertised degrees and programs that it did not even offer. Engaged in unlawful student loan practices. Misrepresented whether Corinthian College credits were recognized by other colleges. The California Attorney General at the time, Kamala…Read More
When the giant for-profit college ITT abruptly went out of business, thousands of students were left in the cold with worthless college credits and massive student loans that did not result in better job prospects. In addition, taxpayers were left having to pay off hundreds of millions of dollars in defaulted federal student loans. All of this has been a cautionary tale for prospective students looking to get ahead by going to college. One of the takeaways from the ITT debacle? Beware of aggressive college recruiters. As part of the ITT bankruptcy proceedings, a group of students filed an intervention, in which they attached hundreds of testimonials from former students and employees of ITT who had been deceived by ITT, or were disillusioned with the experience of having worked for ITT. Their identities were kept anonymous. The following are some powerful testimonials that illustrate that you should take a step back before falling for a…Read More
Regardless of where you are in your life, choosing a college can be one of the most significant decisions in your life. The right college can provide you the tools and foundation to begin a career in the field that you want. Unfortunately, on the other side of the coin, choosing the wrong college can lead you toward a path of heavy debt and regret. This is why we recommend that you take some time and do your homework before deciding on a college. Here are some practical ideas that you might try. Make a decision about what type of degree or trade you are interested in pursuing. Identify and try to talk to people who are actually working in that field. Call a supervisor at a company you’re interested in working for one day. Some people are surprisingly open to providing guidance if they are simply asked. They might give you really valuable information,…Read More
Veterans who serve our country with honor do not deserve to get ripped off. Unfortunately, since World War II, there has been a disturbing trend in for-profit colleges seeing uniformed service members as a source of easy money. This is because the G.I. Bill, created after the second World War, was established to provide tuition to veterans so they can get a college education. For-profit colleges have a special incentive to target veterans due to a loophole in the law, referred to as the 90/10 rule, which allows them to get significantly more Federal money per veteran student than they do for non-military students. Some proposed laws in Congress are being considered to protect our veterans. Protecting Veterans From School Closures Act Inspired by the closure of massive for-profit college ITT, Congressman Luke Messer has offered House Bill 1216, titled the Protecting Veterans from School Closures Act. When ITT closed, it left over 7,000 veterans…Read More
Laureate Education played hardball when trying to sell off the historic College of Santa Fe, to the point of forcing the college to shut down in the midst of an academic year, students claim in a lawsuit. They also claim Laureate should have acted more honorably, considering it is a public benefit corporation. They’re suing the private college operator for breach of contract bad faith, fraud, negligent misrepresentation, unfair trade, and unjust enrichment. Laureate operates more than 70 for-profit colleges and universities, as reported by the Courthouse News Service. Its flagship is Walden University, which grew from 2,082 students in 2001 to over 46,000 in 2010. According to the lawsuit, Laureate hoped to do the same for the College of Santa Fe, which it bought in 2009 and renamed the Santa Fe University of Art and Design. Historically, the college has maintained a very limited enrollment. Far beyond merely having a doomed plan for astronomic…Read More
During the Obama administration, for-profit colleges faced heightened regulation and oversight. The Department of Education was essentially targeting these colleges to determine whether they were inflating or misrepresenting their job placement and earnings statistics in order to induce students into enrolling in their programs. The reason for this is that for-profit colleges receive a disproportionate amount of their revenues from federal student loans and from military members. Making this worse is that their students default at a higher rate than students in public colleges. In fact, for-profit colleges have shouldered much of the blame for the current student loan crisis. Disproportionately High Tuition For-profit colleges charge much higher tuition rates than public colleges. In fact, a recent study found the following discrepancies in tuition: A four-year public college charges an average of $325, while a four year for-profit college charges $647 per hour. That means for-profit college students are paying nearly $40,000 more in base…Read More
During President Obama’s administration, for-profit colleges saw a dramatic decline in students and increasing scrutiny from the Department of Education. The Department of Education had concerns about for-profit colleges taking advantage of students with false promises, poor job placement results, and pushing loans that students could not afford. The combination of increased regulation and declining enrollment resulted in giant for-profit colleges like ITT and Corinthian College abruptly shutting down. In the wake of all of this, there has been a surge in positive press and legislative support regarding community colleges. Here are some of the reasons why. Open enrollment. Community colleges are not exclusive and provide everyone access to a college education. In fact, more than forty percent of all undergraduate students are community college students. In addition, a disproportionate number of students at community colleges are low income. Higher salary. Unlike with for-profit colleges, many of which have been sued for inflating their job…Read More
Trump University was advertised as a real estate investment course in which Donald Trump’s handpicked experts would teach students how to become a successful investors like him. Many students left unsatisfied and claimed that the University did not deliver on its’ promises. Further, students alleged that Trump University employees used heavy-handed tactics to pressure students to continue to spend more money. Thousands of these students joined class-action lawsuits, partly alleging false advertising and deceptive practices. For years, Donald Trump has been fighting these Trump University lawsuits. However, last year, after Trump was elected president, he reached a $25 million settlement agreement with about 6,000 former students in two Trump University lawsuits. Testifying during the impending trial while president would have been a significant distraction. A Snag In The Deal? The only thing remaining for the President and his disgruntled students to put this behind them was for the Judge to sign off on the agreement…Read More
