Attorneys General In 10 States Launch Joint Investigation Into For-Profit Colleges

This is sad on so many levels. Especially since a lot of the students take out loans to pay for school, with the promise of job placement. Sometimes it happens and sometimes it doesn't, but they sell it to all of the students. I hope the guilty are dealt with swiftly to protect those that can't protect themselves.

Top prosecutors in 10 states have convened a joint investigation into potential violations of consumer protection laws by for-profit colleges, Kentucky Attorney General Jack Conway (D), who is leading the multi-state effort, said in an interview with The Huffington Post.

The combined investigation only began within the past two months, but it comes after several state attorneys general launched individual probes of deceptive recruiting practices and possible misrepresentations to recruits regarding federal financial aid dollars.

The multi-state probe is the latest sign that rapidly rising enrollments and an increased reliance on federal student aid dollars by for-profit colleges are attracting greater scrutiny of the industry.

The for-profit higher education industry, which includes a vast swath of colleges ranging from the more than 400,000-student University of Phoenix to small mom-and-pop beauty schools, is facing intense scrutiny from the federal government due to growing federal student loan default rates at many schools. Although only about 10 percent of college students nationwide attend such for-profit institutions, the schools account for nearly half of all student loan defaults, leaving the government to pick up the tab.

“A lot of people who are in Washington right now want to run around talking about fiscal responsibility,” said Conway, who issued subpoenas to six for-profit schools in Kentucky last year, seeking information on job placement claims made to prospective students and management of financial aid dollars. “Well, making certain that $25 billion in federal education dollars doled out is being spend in a way that appropriately trains people and prepares them for job opportunities that are out there … That, to me, is a fiscal responsibility issue.”

Conway confirmed that 10 states so far have signed on to the multi-state working group. He declined to name the other states, but representatives for Attorneys General Tom Miller of Iowa (D), Lisa Madigan of Illinois (D) and Pam Bondi of Florida (R) confirmed that they are participating in the investigation.

A spokesman for the Association of Private Sector Colleges and Universities, Bob Cohen, said in a statement that the organization’s schools are “committed to putting students first” and enforcing existing federal and state laws.

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