Feb 24, 2017 06:43 AM EST
For-Profit Colleges Accused Of Harming Students And Tax Payers Through Fraud [Video]
For-profit colleges were accused of defrauding students and tax payers as they collect high fees but deliver low quality education. The previous administration implemented rules and regulations to protect students from these institutions. Currently, there is a possibility that the new administration will revoke these regulations.
Eighteen attorneys general from different states sent a letter to Education Secretary Betsy DeVos regarding the possible roll back. In their letter, they urged the secretary to be strict with the for-profit colleges. The letter cited numerous cases filed against these institutions. The complaints included fraudulent advertisements to attract students. Most of them allowed students to get loans they apparently cannot afford to pay back. They were also accused of providing low quality education while overcharging students, according to Consumerist.
It seems that these for-profit colleges connive with student loan industries in order to access federal funds intended for students' financial assistance.
During the Obama administration, there were rules and regulations formulated to protect students from these fraudulent learning institutions. The Gainful Employment Rule helps students find gainful employment through career trainings. They are expected to start repayment once they are gainfully employed. However, their payment must not exceed 20% of their earnings.
On the other hand, Borrower Defense to Repayment Rule guarantees that students defrauded by for-profit colleges can appeal for loan relief from the government. For-profit colleges that will violate these rules face possible closure, according to KRWG.
The attorneys general expressed their concern that these for-profit colleges might thrive again under the pro-industry leadership of Secretary of Education Betsy DeVos.
Among these identified colleges that operate for profit were the ITT Technical Institutes, DeVry University, and Corinthian Colleges.
Students and taxpayers would benefit from strengthening and imposing the current rules and regulations. This will stop for-profit colleges from abusing federal financial assistants for students.
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