01.29.19

Durbin Urges Trump-Devos Department Of Education To Stop Embracing Predatory For-Profit College Industry

For-profit colleges continue to collapse as students and taxpayers suffer

WASHINGTON – U.S. Senator Dick Durbin (D-IL) today slammed the Department of Education’s repeated embrace of the for-profit college industry, and urged the Department to take action to help thousands of defrauded students in Illinois and across the country.  In a speech on the Senate floor, Durbin highlighted the continued upheaval in the for-profit college industry with the closures of Vatterott Colleges, Education Corporation of America, and Dream Center Education Holdings – and state settlement with Career Education Corporation (CEC).

“The rot in [the for-profit college] industry runs much deeper than just Corinthian and ITT Tech…How many more for-profit college collapses, closures, and state legal actions will it take before we get serious at the federal level—both in Congress and at the Department of Education—about protecting students and taxpayers from this industry?” Durbin said.

Video of Durbin’s remarks on the Senate floor are available here. 

Audio of Durbin’s remarks on the Senate floor is available here. 

Earlier this month, 48 state Attorneys General—including Illinois’ Lisa Madigan—and the District of Columbia reached a settlement with for-profit giant CEC over consumer violations by the company. Under the settlement, CEC agreed to forgo collecting $493.7 million owed to it by nearly 180,000 students nationally—$48 million in relief for 17,000 students in Illinois. Durbin has long spoken out about the abuses and misconduct of CEC, especially its infamous and now defunct Le Cordon Bleu, Harrington College of Design, and Sanford-Brown brands.

The for-profit college industry enrolls just nine percent of all post-secondary students, but accounts for 34 percent of all federal student loan defaults. In the last five years, nearly every major for-profit college has been investigated or sued by one or more state attorney general and federal agency for unfair, deceptive, and abusive practices. And yet, the Trump-DeVos Department of Education has begun to unwind the unit tasked with investigation fraud at for-profit colleges and universities and is attempting to repeal the Borrower Defense and Gainful Employment rules.

In December, the Department of Education’s Office of Inspector General (OIG) released its semi-annual report to Congress where retiring Inspector General (IG) Kathleen Tighe raised the alarm on for-profit colleges. In the report, IG Tighe noted, “We disagreed with the Department’s proposed elimination of the gainful employment regulations without an adequate replacement to ensure accountability. My predecessors and I have testified before Congress on issues involving proprietary schools over the years, and the sector continues to be a high-risk area for the Department. OIG resources devoted to post-secondary school investigations continue to be disproportionately devoted to fraud and abuse in the proprietary sector. The sector also represents a disproportionate share of student loan defaults. In addition, findings of misrepresentation of job placement rates and guaranteed employment by Corinthian Colleges and other schools provide a clear demonstration of the need for particular accountability.”  The full report can be found here.

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