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    6 years ago by @prophe
     
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      For-profit universities in the US have a record of aggressive marketing practices, poor completion rates, and producing graduates with uncertain job prospects and high levels of debt. So why would Purdue University, a state university in Indiana founded in 1869, buy Kaplan University, a for-profit institution with a record of federal investigations and lawsuits from former students? Purdue is eager to offer online education, and acquiring Kaplan was cheaper that building a new system form scratch, Purdue president Mitch Daniels said in a statement. The school doesn’t have to pay anything upfront, and “will enter into a long-term transition and support agreement, with a buy-out option after year six,” according to a FAQ page. For-profit universities in the US have a record of aggressive marketing practices, poor completion rates, and producing graduates with uncertain job prospects and high levels of debt. So why would Purdue University, a state university in Indiana founded in 1869, buy Kaplan University, a for-profit institution with a record of federal investigations and lawsuits from former students? Purdue is eager to offer online education, and acquiring Kaplan was cheaper that building a new system form scratch, Purdue president Mitch Daniels said in a statement. The school doesn’t have to pay anything upfront, and “will enter into a long-term transition and support agreement, with a buy-out option after year six,” according to a FAQ page. Public universities have been forced to become more entrepreneurial as states have dramatically cut funding. It’s no surprise that Daniels, the former Republican governor of Indiana who slashed the state’s higher-ed budget, would be pushing Purdue to find new sources of revenue. Still, it’s an unexpected turn in American higher education, with a market-driven disruptor swallowed by the stodgy old incumbents. But it may be that the for-profit executives just misread the market signals: Students, it seems, didn’t just want convenient education; they also wanted it to be p
      6 years ago by @prophe
       
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        About 2,000 Kentucky students are eligible for debt relief after getting loans to take online classes through the for-profit Corinthian Colleges Inc., Attorney General Andy Beshear announced Thursday. In Kentucky, the company solicited students under the name Everest College and Everest University. Corinthian also marketed its WyoTech career training program throughout the state. Beshear’s office is notifying eligible students by letter of the cancellation of the federal student loans they used to attend Corinthian schools. Students whose federal loans are canceled will not have to make further payments on the loan and any payments made by the student will be refunded. “As attorney general, my mission is to protect Kentucky’s families from consumer fraud, especially the ongoing deception by for-profit colleges like Corinthian,” Beshear said. “We must do everything in our power to ensure eligible Kentucky students get all the debt relief from fraudulent Corinthian loans.” Federal and state investigators examined Corinthian’s job placement rates, alleging that the company falsified those rates between 2010 and 2014. Currently, Corinthian is not allowed to enroll students and is only remaining open to “teach out” current students. Beshear’s letter will go to Kentucky students who fall within the U.S. Department of Education’s findings of fraud concerning Corinthian, and who are eligible for a special “streamlined” process to discharge their federal student loans. Any student, however, who attended Corinthian Colleges or any other school and believes the school lied about job prospects, the transferability of credits or other issues may apply to have his or her federal student loans discharged using the Department of Education’s universal discharge application at https://borrowerdischarge.ed.gov. More information is available at https://studentaid.ed.gov/borrower-defense. Beshear said Kentucky and states across the country are keeping pressure on the federal government to honor their commitment to help student
        6 years ago by @prophe
         
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          Purdue University in Indiana announced plans Thursday to start a new online school by acquiring for-profit Kaplan University, one of the top destinations for military students and veterans. The unlikely relationship between a public land-grant university and a for-profit school stems from “mutual interests and goals” and a shared desire to expand access to education, according to the terms of the agreement between Purdue and Kaplan’s parent company, Graham Holdings. “None of us knows how fast or in what direction online higher education will evolve, but we know its role will grow, and we intend that Purdue be positioned to be a leader as that happens,” Purdue President Mitch Daniels said in a statement. “A careful analysis made it clear that we are very ill-equipped to build the necessary capabilities ourselves, and that the smart course would be to acquire them if we could. We were able to find exactly what we were looking for.” According to information provided by Purdue, the university’s feasibility studies indicated it would take 36 months to create a single degree program and much longer to create an online school of the magnitude it is acquiring with Kaplan. With Kaplan comes 32,000 students, 3,000 employees and 15 campuses and learning centers throughout the Midwest and East Coast that will fall under Purdue when the acquisition becomes official. The process could take several months, according to Kaplan Inc. spokesman Mark Harrad, as the U.S. Department of Education, state agencies and the institutions’ accreditor agencies still need to sign off. A Military Times analysis of fiscal year 2015 federal data show Kaplan Higher Education Corp. was the 11th most popular destination for active-duty service members using tuition assistance benefits and the 18th most popular school for Post-9/11 GI Bill users. That corporation consisted of Kaplan University, which Purdue acquired, as well as several smaller schools that are no longer part of the company and weren't part of the deal. But Kaplan University acc
          6 years ago by @prophe
           
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            Purdue University’s plan to buy for-profit Kaplan University to expand its reach is the latest twist on an old idea: boost enrollment by attracting students online.
            6 years ago by @prophe
             
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              Students who were scammed by a for-profit college back in the '80s could get their money back under the Trump administration. The Wilfred American Education Corp. used to run beauty and secretarial schools that primarily attracted low-income students, usually women. In 1988, Wilfred had 58 schools and more than 11,000 students, making it one of the largest for-profit college chains in the country. Many of those students used federal loans to pay for their education. But in 1991, Wilfred was found guilty of fraud in two different federal court cases. By law, the Department of Education should have canceled the student loans after the school was shut down. That didn't happen. Seven former Wilfred students sued President Obama's Education Department, demanding their student debt be canceled and the loan payments they made over the years be reimbursed. They were among 60,000 people who took out government-backed loans to go to Wilfred. That lawsuit was originally dismissed on a technicality. The decision was overturned when a judge said the Education Department was required to tell students if they're eligible to cancel a loan. Now, four people familiar with the case told Bloomberg the federal government is considering a deal. It would allow students to petition to cancel their debt and get refunds on past payments. The outlet notes a lawyer for the students said in a March 9 filing that they "have made substantial progress toward a final settlement," but no official agreement has been submitted to the court yet.
              6 years ago by @prophe
               
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                Comeback of for-profit medical schools brings questions of reputation, quality of education After nearly a century of dormancy, for-profit medical schools are making a return in the United States. A recent paper by University researchers analyzed the history, reappearance and possible effects that these schools could have on medical education. Though at one time for-profit medical schools existed in the United States, this changed with the publishing of Abraham Flexner’s 1910 report on the state of these schools, according to the paper. There were numerous critiques of these schools in Flexner’s report, particularly of the standards, requirements, teaching and students’ clinical and research exposure. The report led to a renovation of medical teaching and the subsequent disappearance of for-profit institutions. The medical education system accepted nearly all students who could afford to pay tuition prior to 1910, Gruppuso said. “There was no standardized set of requirements for medical schools, and it was creating a real crisis in terms of quality for medical care.” In 1996, the court case United States v. American Bar Association made it possible for for-profit law schools to be established, according to the paper. Though the Liaison Committee on Medical Education had previously been opposed to for-profit medical schools, they slowly began to change their opinions after the court case and eventually allowed for for-profit medical schools to be established in 2013. According to the paper, a number of investor-owned schools, such as the Rocky Vista University College of Osteopathic Medicine, have been accredited, and more have received preliminary and provisional accreditation. Philip Gruppuso, professor of pediatrics and an author of the paper, said the main point of the article was to bring both the existence and establishment of these for-profit schools to public attention. “(This article) sheds light on the fact that not all medical schools in the United States are nonprofit institutions, so I’m not
                6 years ago by @prophe
                 
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                  I’m working with a client to help fill a management level position, and last week we interviewed an applicant with three degrees from a for-profit university. As college degrees become more important for both hiring and advancement, these for-profit educational institutions are growing in number and presence. For-profit schools are just that — businesses. They are corporations, often with shareholders, that have the objective of making a profit. Education is their product. If you’re thinking about going back to school, here are some things to consider before you commit your time or your money to these businesses. Consider your objective. If you want a technical skill, the for-profit route may be for you. Most of these schools do not have entrance requirements. Money and a high school diploma or its equivalent will get you a seat in the program. If you want a college education, consider that the for-profit degrees come with limits. Credits for your work may not transfer to other programs. A bachelor of science degree may not qualify you to move into a graduate program with another school. Most employers will give preference to a candidate with a degree from a traditional university. And if you’re thinking about an advanced degree that will allow you to teach at the university level, don’t even consider the for-profit route. If your objective is flexibility, remember that many traditional universities are now offering online classes and flexible scheduling. Pay attention to accreditation. Accreditation for the university AND for specific programs is a big deal. Learn what accreditation means. Know what the standard of excellence is. Lack of appropriate accreditation may mean your degree is worth very little. Pay attention to cost. Congress is now involved in investigating the costs of for-profit schools. Many state schools are now offering online, evening and weekend programs for much less money. For example, the Georgia WebMBA program is a fully online 18-month master’s program offered through a consortium of
                  6 years ago by @prophe
                   
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                    A federal appeals court rejected the Consumer Financial Protection Bureau’s investigative fishing trip into the records of a leading accrediting agency for for-profit colleges, saying the bureau failed to explain what sort of illegal conduct it was looking into. The decision by the D.C. Circuit Court of Appeals in Washington is a rebuke to the CFPB and its director Richard Cordray, who demanded the Accrediting Council for Independent Colleges and Schools turn over documents and make an executive available to testify about the group’s possible involvement in “unlawful acts and practices in connection with accrediting for-profit colleges.” The Obama administration mounted fierce legal attacks on for-profit colleges, accusing them of peddling shoddy degrees financed by federal student loans and forcing Corinthian Colleges and ITT Technical Institute to close their doors. This appears to be the first time in decades that a federal appeals court rejected an agency's civil investigative demand or administrative subpoena, said Allyson Baker, a partner in Venable's Washington office who represented ACICS. “They didn’t think the CFPB met the requirements of the statute, which requires notice,” said Baker, herself a former CFPB enforcement attorney. ACICS refused to comply with the civil investigative demand in 2015, sending the question to a federal district court. That court last year said the CFPB, which is charged with enforcing consumer financial laws, didn’t have authority to question a school accrediting agency. The CFPB “plowed head long into fields not clearly ceded to it by Congress,” the district court said. The D.C. Circuit affirmed today, in an opinion by Judge David Sentelle, on narrower grounds. The agency “wholly fails” to state what sort of unlawful conduct it is investigating, the appeals court said. The CFPB never explained what “unlawful acts and practices” it suspected and merely repeated the same language in court filings. Without specifics, the court said it can’t determine whether the demand
                    6 years ago by @prophe
                     
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                      For-profit college investors bid up stock prices in anticipation of a lenient Trump administration. Were they wrong? For-profit colleges were supposed to thrive under a Trump administration staffed by officials known to be friendly to the industry. President Donald Trump and Republican allies in Congress had made broad promises either to revisit or to repeal federal rules governing the schools. That gave hope to for-profit colleges and their investors, driving up their stock prices. Meanwhile, consumer protection advocates worried about a resurgent for-profit college sector unburdened by Obama-era rules. A legal filing from last week suggests perhaps those assumptions were premature. In late March, the Trump administration offered a forceful defense of the so-called gainful employment rule, the 2015 regulation that threatens to shut off the spigot of normally free-flowing federal funds that sustain career programs if the typical graduate's annual loan payments exceed 20 percent of her discretionary income or 8 percent of total earnings. It also called on suspect career programs to warn prospective students if they risked running afoul of the guidelines. Colleges mostly opposed the rule. “The regulations are intended to protect students and taxpayers by providing warnings about programs with relatively high loan debt compared to the earnings their students could hope to achieve after graduating from those programs,” Justice Department attorneys wrote in their brief on behalf of Education Secretary Betsy DeVos. Students benefit from the warnings, Trump administration lawyers wrote, “because it could prevent them from taking on debt that they will not be able to repay, and they could more reasonably evaluate whether they would prefer to enroll in programs that have been more successful in enabling their students to find employment that would allow them to repay their loans.” Taxpayers would benefit, too, they wrote, because of the likely corresponding fall in defaults on federal student loans. “The public intere
                      6 years ago by @prophe
                       
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                        A new report from the American Enterprise Institute argues that state and local funding of public colleges stacks the deck against for-profit institutions under the gainful-employment rule, an Obama administration regulation that measures the ability of graduates of vocational programs to repay their student loans. The rule covers nondegree programs at nonprofit colleges -- mostly community colleges -- and all for-profit programs. Roughly three-quarters of for-profit programs pass the rule, the report said, compared to a relatively small number of nonprofits that are covered under gainful employment. Direct public funding drives much of that disparity, according to the report's authors. "Higher tuition at for-profits means students take on more debt, while public institutions have the luxury of charging lower tuition due to their direct appropriations," the report said. "Therefore, even if a for-profit institution and a public institution have similar overall expenditures (costs) and graduate earnings (returns on investment), the for-profit institution will be more likely to fail the gainful-employment rule, since more of its costs are reflected in student debt." Congressional Republicans and the Trump administration have said they will seek to roll back gainful employment and other Obama-era regulations aimed at for-profits. But such nixing of the rules likely will take time. And this week the U.S. Education Department defended gainful employment in federal court.
                        6 years ago by @prophe
                         
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                          The Trump administration is delaying implementation of one of the signature policies of the Obama-era crackdown on for-profit colleges. The Department of Education announced Monday night it was targeting the Obama administration rule aimed at holding career-training programs accountable for getting students decent jobs and earnings. To be in compliance with the regulations, career-training programs, which are largely at for-profit colleges, need to graduate students whose loan payments don’t exceed 20% of their discretionary income or 8% of their total earnings. Programs that don’t fit this criteria for multiple years could lose access to federal financial aid. Career-training schools will now have until July 1 to file appeals to the program debt-to-earnings ratios published by the Department earlier this year, as part of the enforcement of the gainful employment (GE) rule. Originally, their appeals were due Friday, March 10. The schools will also now have until July 1 to publish disclosures about their debt-to-earnings ratio that are required by the new law. Before this decision, the programs had until April 3 to post those disclosures. The gainful employment rules were a long fought victory for the Obama administration in its quest to crack down on for-profit colleges, which officials and advocates have accused of loading students up with high debt loads for questionable outcomes. The for-profit college industry fought the regulations in court and the Obama administration ultimately prevailed. But the Trump administration’s embrace of an increased role for the private sector in education has had supporters of efforts to crack down on for-profit colleges worried that the new rules could be in jeopardy — and investors betting on for-profit schools. The delay is the first signal that that speculation may be correct. “This is a sign that does nothing to dispel concerns that this administration will be sufficiently aggressive in protecting students,” said Ben Miller, the senior director of postsecondary educati
                          6 years ago by @prophe
                           
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                            Many for-profit colleges are accused of broken promises, high prices and not preparing students for the workforce. The federal government has increased its regulation of them. It's sparking a big debate in Washington, and two of the main players are North Carolina politicians. The new chair of the U.S. House Committee on Education and the Workforce, U.S. Rep. Virginia Foxx (R-- N.C., District 5) already said the rules need to go. The way she sees it, the Obama administration "intentionally targeted and sought to dismantle career colleges and universities with unnecessary regulations." She praised for-profit schools, calling them "responsive higher learning institutions." Action 9 investigator Jason Stoogenke found her biggest donor is a for-profit college, Full Sail. Full Sail is based in Florida and focuses on entertainment and media, offering degrees up to master's. When Stoogenke asked Foxx whether that's a conflict of interest, she emailed, "When an individual or industry offers me their support, they're endorsing my views, not the other way around." On the other side, 18 attorneys general, including North Carolina's Josh Stein, are urging the federal government not to go easy on for-profit schools. They sent the federal government a letter, saying undoing the regulations would mean "open season" on students. "We're very concerned," he said. "They're preying on people's dreams." LETTER When students can't pay back debt, taxpayers get stuck with the bill. Some wonder how much debt students rack up at for-profit colleges. The Brookings Institution created a list of 25 colleges where students are the most in debt. More than half are for-profit schools. Charlotte School of Law, DeVry, ITT Tech, Brookstone and Kaplan have all had problems in recent years, either financial, legal, or both. "It's been really hard," Charlotte Law student Stefanie Quinde said. "I understand it's a business. But at end of day, the interest of the students, it's, it's a big priority." "I think the regulat
                            6 years ago by @prophe
                             
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                              Dive Brief: Career training programs will have until July 1 to appeal the U.S. Department of Education for reconsideration of compliance under current gainful employment and revenue reporting guidance enacted by the Obama administration, a signal that the Trump administration is holding to promises of massive deregulation in the federal education agency. The extended review period will allow schools the chance to prove they were unfairly assessed in previous years, under rules requiring that graduates' loan payments do not exceed 20% of their discretionary income or 8% of total earnings, metrics that many for-profit college advocates say was an unfair rule designed to disrupt for-profit impact in higher education. For-profit leaders applauded the extension, but opponents say the delays will allow more students to potentially be defrauded by predatory recruitment schemes and false information about postgraduate outcomes. Dive Insight: The extended review of the gainful employment policies will have impact throughout the higher education sector, as community colleges and schools which disproportionately serve poorer students will now have time to provide more context about graduation rates and employment outcomes which previously may not have been possible due to time constraints. Additionally, the extension signals the first sign of regulatory repeals for higher education, one of the only signature details of President Trump's higher education platform during the campaign season, and a recurring theme shared by Congressional higher education leaders. For most institutions, this is a positive sign towards reducing costs and manpower committed to compliance efforts, but for smaller institutions with missions to serve underrepresented populations, it may be a lifeline.
                              6 years ago by @prophe
                               
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                                MADISON, Wis. — Gov. Scott Walker is renewing his push to eliminate the state board that regulates for-profit colleges. The executive budget Walker unveiled Wednesday calls for eliminating the Educational Approval Board by January 2018 and transferring its duties to the Department of Safety and Professional Services. The governor proposed getting rid of the board in his 2013-15 executive budget as well, arguing then that doing away with it would lift unnecessary financial and regulatory burdens on for-profit schools. Opponents countered that the board plays a key role in overseeing the schools and the Legislature's finance committee ultimately nixed the idea as it revised Walker's budget. The board's executive secretary, David Dies, didn't immediately respond to messages seeking comment on the new proposal.
                                6 years ago by @prophe
                                 
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                                  Current higher education policy in England is based on “bad pub economics” and ministers have failed to learn the lessons from international developments, according to a leading academic. Lorraine Dearden, professor of economics at the UCL Institute of Education and research fellow in education at the Institute for Fiscal Studies, lamented England’s 2012 trebling of fees to £9,000 and current plans in the Higher Education and Research Bill to ease the entry of new private providers as being driven by a desire to create competition. "There are very, very good economic reasons why the market alone cannot be allowed to operate in higher education,” said Professor Dearden in a keynote speech at the Central for Global Higher Education’s annual conference in London on 1 March. She cited “credit market failures” for student lending that means government has to provide loans, the fact that higher education brings “social returns” as well as private returns, “risk and uncertainty” caused by student reluctance to borrow, and “information problems” that mean prospective students cannot know the costs and benefits of their higher education until much later in life. The government’s misguided notion that price competition between universities would occur under the £9,000 cap – when in reality all have ended up charging the maximum – was “bad pub economics”, Professor Dearden said. The £9,000 fees policy failed to take into account the fact that income-contingent loans meant the repayment risk from higher fees was borne by government rather than universities or students, she added. “If you want to allow a range of fees, what is important is that the higher education institutions need to share some of the risk of non-repayment,” she continued. That would mean a system that better reflects the “true costs and benefits” of courses, Professor Dearden said. She added that there were currently “lots of economists trying to work out” how to ensure that universities “have skin in the game”. Professor Dearden also accused Jo Jo
                                  6 years ago by @prophe
                                   
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                                    The Trump administration has taken its first shot at rules designed to protect students from expensive, low-quality colleges and career training programs. Less than a month after Betsy DeVos was sworn in as its top official, the U.S. Department of Education announced Monday evening that it would delay until July 1 an effort to crack down on career training programs that load students up with unpayable debt. The biggest winners: the more than 800 higher educational programs that claim to lead to “gainful employment” but flunked the department’s January excessive debt test—mostly for-profit art and cosmetology schools. These programs can now continue to recruit applicants (at least until July 1) without having to warn them about alumni’s oppressively high debt loads. The schools can also take this extra time to seek data showing that their graduates’ student loan bills are actually below the official “excessive debt” cutoff. That means bills must be no more than 12% of the average student’s gross earnings, as reported to the Social Security Administration, and no more than 30% of their discretionary income. That means, for example, that students considering entering, say, the Art Institute of Pittsburgh’s two-year Associate’s program in graphic design won’t necessarily be warned that the typical graduate of the program has taken on about $40,000 in debt, but finds a job paying only about $22,000 a year. The monthly financial reality for such graduates is grim. Their before-tax monthly salary works out to about $1,900. The monthly payments on a standard 10-year student loan repayment plan top $400 – or more than 20% of their gross earnings. The department said it would use the extra time to “further review the [Gainful Employment] regulations and their implementation.” The action puts the brakes on one of many last-minute moves by the Obama administration. In January, the Department of Education issued an analysis of the earnings and student debt levels of more than 8,600 higher education programs that offer pr
                                    6 years ago by @prophe
                                     
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                                      6 years ago by @prophe
                                       
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                                        6 years ago by @prophe
                                         
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                                          It may be too late for shuttered Corinthian Colleges, ITT Technical Institute or even Trump University, but Wall Street is betting the potential rollback of Obama-era initiatives to hold for-profit colleges accountable may lead to a resurgence of the beleaguered industry. Rebounding from what some analysts saw as an existential threat during the Obama administration, for-profit college stocks are up sharply since Donald Trump's November election amid renewed investor optimism — and growing concern from education watchdogs. "The perception of investors has been that the prior administration was really out to get the sector," said Trace Urdan, a research analyst at Credit Suisse. "Trump helps make these companies more investable because there is less concern that the government is trying to drive them out of business." Less than 100 days into Trump's presidency, the Department of Education under Secretary Betsy DeVos has delayed implementation of gainful employment rules, withdrawn key federal student loan servicing reforms, and signaled a less onerous regulatory environment for the essentially taxpayer-financed career education sector. While good news for investors, the policy shift may mean "buyer beware" for students such as Gilbert Caro, of Chicago, who amassed nearly $100,000 in debt while working toward a master's in business administration at DeVry University, only to end up working as a prison guard near Joliet. Caro is among the tens of thousands of for-profit college graduates alleging they were misled and seeking relief from their federal student loans. "The initial signs are troubling," said Pauline Abernathy, executive vice president of the Institute for College Access and Success, a nonprofit research and advocacy organization focused on alleviating student debt. The for-profit college industry, which saw enrollment peak during the depths of the Great Recession, became the focus of an Obama administration crackdown in 2011, taking on everything from inflated job placement claims to predatory fin
                                          6 years ago by @prophe
                                           
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                                          publications  41