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Friday, January 31, 2014

Federal complaint system set up for veterans harmed by deceptive for-profit colleges

A new system aimed at making it easier for veterans and military service members to file complaints regarding deceptive practices by for-profit colleges is up and running.  As reported in the Huffington Post, the new portals for complaints are the result of a collaboration involving the Department of Education, the Department of Justice, the Department of Veterans Affairs, the Department of Defense, the Consumer Financial Protection Bureau, and the Federal Trade Commission.  Numerous investigations have revealed that for profit colleges have engaged in widespread abuses of vets and military families.


Tuesday, January 28, 2014

State attorneys general investigating major for-profit school businesses

A coalition of attorneys general from at least 12 states is investigating major for-profit school companies, according to recent news reports.  The investigation reportedly includes Education Management Corp., Corinthian Colleges, Career Education Corp, and ITT Tech.  The Huffington Post reports that each company has filed disclosures with the Securities Exchange Commission regarding the investigation, and "Each school said it was being probed by a group of 12-13 state AGs, with the AGs of Kentucky, Iowa, Pennsylvania, and Connecticut each taking the lead on investigating one of the companies.  All four companies said they intended to cooperate." 

Sunday, January 26, 2014

Another for-profit school suddenly closes

A California-based for-profit school suddenly closed recently, marking the latest example of students and faculty being blindsided by the shuttering of a school with accreditation and financial aid troubles.
The Los Angeles Times reports that Career Colleges of America abruptly closed on January 9, 2014, after more than 25 years of operation.  Months earlier, the school had been notified by its accreditor that it was in danger of losing its accreditation due to budgeting and other fiscal issues.

Federal agency investigates ITT and Corinthian

The newly created Consumer Financial Protection Bureau is investigating ITT Educational Services and Corinthian Colleges -- two of the nation's largest for-profit education companies.
As reported in the Chronicle of Higher Education, the agency has informed ITT and Corinthian regarding its investigations, although the precise nature of the inquiries has not become public.  A senior analyst for Wells Fargo Securities, according to the Chronicle, has written that ITT is most likely being investigated after disclosing that it expected more than 50 percent of its student borrowers to default on their private loans.

Closing of American Career Institute prompts reform effort

One year after the sudden closing of American Career Institute, Massachusetts is considering reforms that seek to reduce deceptive practices and require greater accountability from for-profit colleges.  As reported by, the state is considering regulations sought by Attorney General Martha Coakley would "would prohibit for-profit schools from aggressive sale tactics, such as repeated solicitations through phone calls and text messages, and require them to disclose their tuition and fees, placement statistics, and graduation rates in their advertising."  
ACI closed without learning in early 2013 in Springfield, Cambridge, Braintree, Framingham and Woburn. 

Federal judges finds against accrediting agency for revoking accreditation of massage school

A federal judge has revoked an accreditor's decision to strip a massage school of its accreditation, finding that the decision by the accreditor was arbitrary and unreasonable.  The decision by U.S. District Judge Liam O'Grady reversed the March 2012 actions of the Accreditation Alliance of Career Schools and Colleges to revoke the accreditation of the Professional Massage Training Center in Springfield, Missouri.  The judge also awarded $429,000 in damages in favor of the school.

Massachusetts officials seek closer scrutiny of for-profit scools

The Boston Globe reports that two Massachusetts officials are taking steps to provide closer scrutiny of for-profit colleges, where students often find themselves taking on heavy student loan debts for subpar programs with limited job prospects and credit transfer opportunities.
According to the report, U.S. Senator Elizabeth Warren (D-Mass.) has introduced a "bill she said will protect student borrowers by requiring colleges to assume some of the risk of student loan default." 
Meanwhile, the state's attorney general, Martha Coakley, " is proposing new state regulations prohibiting for-profit and occupational schools from using misleading advertising and unfair lending practices."
If you have a concern about a for-profit school, contact the attorneys at The Googasian Firm, 1-877-540-8333.