08.04.10

Following GAO Investigation on For-Profit College Recruiting, Chairman Harkin to Issue Document Request for 30 For-Profit Schools

WASHINGTON, D.C.  – Following the second oversight hearing of the Senate Health, Education, Labor and Pensions (HELP) Committee, Chairman Tom Harkin (D-IA) today announced that he will initiate a document request to 30 companies operating for-profit schools.  The announcement came at the end of the Committee’s hearing today titled “For-Profit Schools: The Student Recruitment Experience.”  This is the second in a series of hearings conducted by the Committee to examine the federal investment in for-profit colleges.  The hearing included testimony by the Government Accountability Office (GAO) of the undercover investigation they conducted of recruiting practices at 15 for-profit schools in cities across the country.   

“All 15 schools GAO investigated found instances of fraud, deceptive practices or misleading statements to prospective students,” said Harkin.  “This is unacceptable, particularly when the students these schools serve need the greatest help.  I continue to be amazed by the questionable, and sometimes outright illegal, practices occurring within the for-profit sector.  Critics say that it is only a few bad apples, but we need to take a hard look at the entire orchard.
 
“Tomorrow I will issue requests for information and documents to 30 for-profit schools,” he continued. “I believe the information I am requesting will help us form a fuller picture than we have at this time.  And we will continue to look into this sector and hold additional hearings this fall.”

The document request will be to 15 privately held and 15 publicly-traded schools of varying size and geography to compare practices across the sector.  A list of the publicly traded schools can be found here and a list of the private colleges can be found here.  The document request seeks a better understanding of the number of students who complete or graduate from programs offered by the schools, how much programs cost, student debt burdens and job placement rates.

The requests specifically seek information to more accurately understand how the schools use the Federal taxpayer dollars they receive including how the schools recruit and enroll students, set tuition, handle withdrawal of students and return of Title IV dollars, and manage compliance with the requirement that no more than 90 percent of revenues come from Title IV dollars.  

On June 24, Harkin’s Committee released the report “Emerging Risk?: An Overview of Growth, Spending, Student Debt and Unanswered Questions in For-Profit Higher Education.”  A full copy of the report can be found here.

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