Millions of would-be students turn to the federal government in order finance their education, each taking out thousands of dollars in loans. While that influx of funds allows borrowers to seek a better life by obtaining a degree, it also has to be repaid. And when that becomes impossible for some consumers, debt collectors hired by the Department of Education sometimes resort to garnishing wages. [More]
department of education
Law Firm In Charge Of Corinthian Colleges Turnaround Fired By Dept. Of Education
By 3.15.16
When Education Credit Management Corporation completed the purchase of 56 Everest University and WyoTech campuses from now-defunct for-profit education chain Corinthian Colleges, it agreed to hire an independent monitor to oversee the turnaround of the schools. Things apparently aren’t going so well, as the Department of Education announced it has fired the law firm hired for the task. [More]
VA Suspends DeVry University’s Participation In “Principles Of Excellence” Program
By 3.14.16
The Department of Veterans Affairs announced Monday that it would suspend DeVry University’s status as a Principles of Excellence institution after reviewing a federal lawsuit that accuses the popular for-profit college chain of deceiving prospective students about their employment potential after graduation. [More]
Appeals Court Shuts Down For-Profit College Industry’s Effort To Avoid Accountability
By 3.8.16
The for-profit college industry lost an important legal battle today, when a federal appeals court upheld last year’s lower court ruling in favor of new regulations intended to hold these controversial schools accountable. [More]
Advocates: Schools Using Forced Arbitration Shouldn’t Receive Federal Aid
By 3.4.16
For-profit colleges that require students to sign away their legal rights, forcing them into arbitration in order to enroll in classes should not receive federal financial aid, a coalition of 47 consumer advocacy groups urged acting Secretary of Education John King on Friday. [More]
Senators: No More Federal Funding To For-Profit Colleges That Strip Students Of Legal Rights
By 2.12.16
If your college breaks the law, you should be able to pursue a legal action in court. But following the lead of banks, wireless providers, and cable companies some for-profit colleges have been stripping students of their legal rights and forcing them into arbitration. These schools should not receive federal funding, says one group of lawmakers. [More]
New Student Aid Enforcement Unit Created To Address Alleged Fraud At For-Profit Colleges
By 2.9.16
With thousands of former Corinthian Colleges students waiting to find out if their federal student loan debts will be discharged because the now-defunct for-profit college allegedly deceived them with false promises related to their future careers, the Department of Education announced the creation of a special enforcement unit with the goal of being able to respond quickly to allegations that colleges are violating the law. [More]
For-Profit Beauty School Chain Shuts Down Just Days After Losing Federal Funding
By 2.5.16
Just days after losing access to federal student financial aid because it allegedly falsified records and overcharged students, the for-profit Marinello Schools of Beauty has shuttered all of its campuses. [More]
Two For-Profit College Chains Lose Government Funding Over Misrepresentations, Inflated Job Placement Rates
By 2.2.16
If you hear a for-profit college touting its high job-placement rate, you’ve got good reason to be skeptical. Federal regulators have cut of government funding to two more for-profit education chains caught inflating placement stats.
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Feds Order Debt Relief Schemes To Cease Misleading Use Of Government Logos
By 1.29.16
Even though it’s incredibly easy to slap a government agency’s logo on your website, that doesn’t make it okay. Just ask the two debt relief companies that have been ordered to stop using Department of Education logos to mislead student loan borrowers. [More]
Dept. Of Education Working On Rules For Defense Of Repayment Law After Influx Of Claims
By 1.20.16
Under federal law, student loan borrowers may be eligible to have their debts discharged if they prove the school they attended deceived them with false promises related to their future careers. However, the measure has been used only sparingly in the past and few clear rules outline the forgiveness process. Now, after nearly two decades on the books, federal officials are finally getting around to crafting rules that could remove one roadblock for students seeking relief. [More]
How The Federal Government Tries To Keep Financially Troubled Colleges From Failing
By 12.22.15
Under federal law, colleges that record a student loan default rate of 30% or more for three consecutive years – or 40% in a single year – can lose their access to federal aid. While the rule is meant to weed out bad players and schools that don’t provide students with means for gainful employment, a new report shows that the government often intervenes, propping up schools just before they fail. [More]
7 Things We Learned About Federal Student Loans & The Companies That Profit From Them
By 12.11.15
Fifty years ago, Congress created the federal loan program as a way to help Americans realize their dreams of a better life through higher education. While millions of students have no doubt benefited from the program, millions of others have found themselves burdened by mountains of debts, fielding calls from debt collectors and loan servicers, and watching as their paychecks are whittled down by garnishments. Today, seven million former college students are in default with a record $115 billion in federal loans. While those figures may be oppressing borrowers, it’s providing a stream of income – and profit – for companies contracted by the government to collect payments from debtors. [More]
Feds Forgive $103M In Debt For Nearly 7,000 Former Corinthian College Students
By 12.4.15
Nearly 7,000 additional former students of defunct for-profit chain Corinthian College will have their loan debt erased by the federal government. While the $103 million tab sounds like a lot, it’s only a fraction of the billions of dollars that Wyotech, Heald College and Everest University charged in tuition. [More]
Corinthian College’s Misleading Job-Placement Info Could Result In Faster Debt Relief For Students
By 11.17.15
Thousands of students affected by the abrupt closure of for-profit college educator Corinthian Colleges’ Wyotech, Heald College and Everest University campuses could soon have more options when it comes to receiving debt relief after a joint investigation by the California Attorney General’s office and the Department of Education found additional evidence that the schools misrepresented job placement rates for several programs in order to enroll students. [More]
UPDATE: For-Profit Education Company EDMC Agrees To Pay $95.5M To Settle Fraud, Recruitment Violations
By 11.16.15
UPDATE: Education Management Corporation, the operator of for-profit college chains such as Brown Mackie College, Argosy University and the Art Institutes, will pay $95.5 million to settle claims it violated state and federal False Claims Act (FCA) provisions regarding its recruiting practices. [More]
New Campus Banking Rules Hope To Protect Students From High Prepaid & Debit Card Fees
By 10.27.15
Back in May, the Department of Education proposed rules to govern college prepaid and debit cards in order to afford students proper protections from excess fees and other harmful practices. Fast forward five months, and those rules have are now finalized. [More]
Conflicts In Patient Privacy Laws Often Leave Student Health Records Vulnerable
By 10.23.15
When a college student seeks medical treatment at a campus healthcare facility, they probably expect they will be afforded the same discretion as all consumer are under HIPAA (the Health Insurance Portability and Accountability Act). But thanks to a separate, often conflicting federal law, that isn’t always the case. [More]
