States crack down on for-profit universities

The Hechinger Report 14 March 2014

Oversight of for-profit colleges and universities by the United States Department of Education has been mired in political quicksand and thwarted by the colleges' effective lobbying and legal challenges. But now, states and other federal agencies are stepping in and cracking down, writes Matt Krupnick for The Hechinger Report.

Attorneys general across the country are investigating for-profit colleges accused of leaving students with overwhelming loan debt and without marketable job skills. At least 32 states are working together to investigate the institutions, and 14 of those have already filed subpoenas for information, while several more are working independently on similar cases.

In cooperation with several of these states, the new federal Consumer Financial Protection Bureau, or CFPB - the agency set up after the financial downturn to regulate financial institutions - has sued ITT Educational Services for predatory lending practices, the CFPB's first such lawsuit. Corinthian Colleges, which like ITT has been accused of abuses, has also noted in regulatory filings that the CFPB was considering legal action against it.
Full report on The Hechinger Report site

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