The For-Profit College Rip-Off: Predatory Schools Take 90 Percent Of Revenue From Govt, Leave Studen

[Donnachaidh]

http://thinkprogress.org/2011/02/04/for-profits-data/

The Education Department today released new data on the rate at which higher education students default on their student loans, which showed that students at for-profit colleges — schools like the University of Phoenix or Strayer University — are defaulting at rates far above those at other institutions. In fact, 25 percent of students who attend for profit colleges default within three years. Here’s a chart comparing default rates at different types of schools (the green bar represents defaults at private, for-profit schools).

Here are some more key facts about for-profit colleges:

– Just 11 percent of higher education students in the country attend for-profit schools, yet they account for 26 percent of federal student loans and 44 percent of student loan defaults.

– Many of the schools make up to ninety percent of their revenue from U.S. taxpayers, through the Pell Grants, Stafford Loans, and other federal assistance used by their students. 91.5 percent of Kaplan’s revenue comes from the government, along with 88 percent revenue at the University of Phoenix.

More at the link --

[Hannah Bell]

1. kr

[Bozita]

2. The for-profit education/training hucksters are now suing the GAO

http://legaltimes.typepad.com/blt/2011/02/for-profit-college-group-sues-gao-alleging-malpractice-negligence.html

FEBRUARY 02, 2011
For-Profit College Group Sues GAO Alleging Malpractice, Negligence


A coalition representing some of the nation’s for-profit colleges sued the Government Accountability Office on Wednesday for alleged professional malpractice and negligence in its investigation of so-called career colleges.

The lawsuit—Coalition for Educational Success v. U.S.—was filed under the Federal Tort Claims Act in Washington federal court on behalf of the Chicago-based coalition by Paul Smith, a partner at Jenner & Block. It charges that the GAO “issued a negligently written, biased and distorted report that foreseeably caused substantial financial injury” to the coalition.

Last June, the Senate Health, Education, Labor and Pension Committee, chaired by Sen. Tom Harkin (D-Iowa), began a series of hearings to examine federal education spending at career colleges, such as Strayer University and ITT Technical Institute. In preparation for the hearings, Harkin, a critic of career colleges, asked the GAO to conduct an undercover investigation to determine if career college representatives engaged in fraudulent, deceptive, or otherwise questionable marketing practices.

The GAO sent individuals posing as applicants to 15 career colleges in six states and Washington, D.C. In August, the government auditor released a highly critical report, stating that four of the career colleges engaged in fraudulent practices and that all 15 colleges made deceptive or otherwise questionable statements. The August report was submitted as testimony to the Senate committee. But in November, the GAO issued a revised report and testimony that corrected findings for 13 of the 15 colleges.

The revised report has triggered an inquiry into the GAO’s forensic audit and special investigations unit by House Oversight and Government Reform Chairman Darrell Issa, R-Calif.

more...

[leftstreet]

3. K&R

[jwirr]

4. They may be defaulting but the students have a big thought coming.

When they file their income tax there will be no refunds until the loans are paid off.