For-Profit Colleges: Undercover Testing Finds Colleges Encouraged Fraud and Engaged in Deceptive and

[malaise]

Questionable Marketing Practices

http://www.gao.gov/products/GAO-10-948T
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Undercover tests at 15 for-profit colleges found that 4 colleges encouraged fraudulent practices and that all 15 made deceptive or otherwise questionable statements to GAO's undercover applicants. Four undercover applicants were encouraged by college personnel to falsify their financial aid forms to qualify for federal aid--for example, one admissions representative told an applicant to fraudulently remove $250,000 in savings. Other college representatives exaggerated undercover applicants' potential salary after graduation and failed to provide clear information about the college's program duration, costs, or graduation rate despite federal regulations requiring them to do so. For example, staff commonly told GAO's applicants they would attend classes for 12 months a year, but stated the annual cost of attendance for 9 months of classes, misleading applicants about the total cost of tuition. Admissions staff used other deceptive practices, such as pressuring applicants to sign a contract for enrollment before allowing them to speak to a financial advisor about program cost and financing options. However, in some instances, undercover applicants were provided accurate and helpful information by college personnel, such as not to borrow more money than necessary. In addition, GAO's four fictitious prospective students received numerous, repetitive calls from for-profit colleges attempting to recruit the students when they registered with Web sites designed to link for-profit colleges with prospective students. Once registered, GAO's prospective students began receiving calls within 5 minutes. One fictitious prospective student received more than 180 phone calls in a month. Calls were received at all hours of the day, as late as 11 p.m. To see video clips of undercover applications and to hear voicemail messages from for-profit college recruiters, see http://www.gao.gov/products/GAO-10-948T. Programs at the for-profit colleges GAO tested cost substantially more for associate's degrees and certificates than comparable degrees and certificates at public colleges nearby. A student interested in a massage therapy certificate costing $14,000 at a for-profit college was told that the program was a good value. However the same certificate from a local community college cost $520. Costs at private nonprofit colleges were more comparable when similar degrees were offered.

http://www.iowapolitics.com/index.Iml?Article=205461
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WASHINGTON, D.C. – Following the second oversight hearing of the Senate Health, Education, Labor and Pensions (HELP) Committee, Chairman Tom Harkin (D-IA) today announced that he will initiate a document request to 30 companies operating for-profit schools. The announcement came at the end of the Committee’s hearing today titled “For-Profit Schools: The Student Recruitment Experience.” This is the second in a series of hearings conducted by the Committee to examine the federal investment in for-profit colleges. The hearing included testimony by the Government Accountability Office (GAO) of the undercover investigation they conducted of recruiting practices at 15 for-profit schools in cities across the country.

“All 15 schools GAO investigated found instances of fraud, deceptive practices or misleading statements to prospective students,” said Harkin. “This is unacceptable, particularly when the students these schools serve need the greatest help. I continue to be amazed by the questionable, and sometimes outright illegal, practices occurring within the for-profit sector. Critics say that it is only a few bad apples, but we need to take a hard look at the entire orchard.

“Tomorrow I will issue requests for information and documents to 30 for-profit schools,” he continued. “I believe the information I am requesting will help us form a fuller picture than we have at this time. And we will continue to look into this sector and hold additional hearings this fall.”
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Loot the government and tax payers - that's the FREE market.

[tridim]

1. I wish they'd do the same at Regent University.

[AnneD]

2. Student loans...

The next economic bubble.