For-profit colleges face more scrutiny in new report

Enrollment at for-profit colleges has climbed to 1.8 million in recent years.
Enrollment at for-profit colleges has climbed to 1.8 million in recent years.

A government report released Aug. 4 details “fraudulent” practices among recruiters for some for-profit colleges, and public criticism of the popular institutions has mounted as recent statistics show that at least one for-profit university received $1 billion in federal Pell Grants during the 2009-10 academic year.

Investigators from the Government Accountability Office (GAO) posed as college students and found that four out of 15 institutions they examined “encouraged fraudulent practices” to secure federal student loans, and representatives from all 15 colleges “made deceptive or otherwise questionable statements” to the undercover students, according to a report published on the GAO’s web site.

The extensive report is the latest in a string of negative publicity for for-profit schools, which include industry giants such as the University of Phoenix, Kaplan University, and DeVry University.…Read More

For-profit colleges face mounting scrutiny

Commercial schools continue to see rising stock prices despite a rash of bad news.
Commercial schools continue to see rising stock prices despite a rash of bad news.

Officials at for-profit colleges and universities are facing a chorus of public criticism after accusations of shady student recruiter practices and a U.S. Department of Education (ED) report that showed twice as many students at for-profit schools have defaulted on their college loans as students attending nonprofit and public colleges and universities.

The mounting criticism comes as new research suggests for-profit colleges are gaining market share among online learners as the recession drives more people back to school.

Students who took out loans to pay for education at commercial institutions such as the University of Phoenix and DeVry University had a 21-percent default rate within three years, according to the Dec. 14 ED report, which used data from students who began loan repayment in fiscal year 2007.…Read More