For-Profit Schools Target Vulnerable Vets, Give to Clinton Foundation
Hillary Clinton took aim at the for-profit education industry last week saying it lies to military veterans to boost profits, but the industry’s most predatory schools are Clinton Foundation donors.
Clinton during an event in Nevada last Thursday accused for-profit schools of exploiting the so-called 90-10 rule in order to “target service members, veterans, and their families with false promises and deceptive marketing”; the rule, established by the amended Higher Education Act of 1965, caps the percentage of total revenue for-profit schools can receive from Title IV federal financial aid. The rule forbids for-profit schools from receiving 90 percent of their revenue from federal financial aid—but the amount of federal money they receive in the form of veterans’ benefits is not restricted—making service members and veterans attractive prey for the revenue hungry industry.
The school relying on veterans’ benefits most has been the for-profit University of Phoenix, which took in nearly $1 billion in G.I. Bill funds from 2009 to 2014 according to PBS.
The Apollo Group, which is the parent company of the University of Phoenix, has donated up to $100,000 to the Clinton Foundation and at least part of that donation came as recently as 2014.
The University of Phoenix is highly effective at recruiting veterans. The school’s San Diego campus, which has a high veteran population, took in $95 million through the G.I. Bill during that five-year span, which is more than any other college in the country.
Unfortunately, much of that money is going to waste. A recent study found that only 16 percent of University of Phoenix students graduate within six years. For online students, the graduation rate is just 5 percent.
Brown Mackie College, also a 2014 Clinton Foundation donor, is part of the Education Management Corporation (EDMC), which is the country’s second largest for-profit college company.
A lawsuit from whistle-blowers against EDMC that became public in 2014 alleged that it was recruiting veterans by overpromising on post-graduate employment prospects, and that EDMC was lowering the reported incomes of its applicants with the goal of receiving more G.I. Bill funds.
“[EDMC’s] business is not that of an educational institution. It is a sales company,” argued the attorneys in the suit. “Defendants place virtually no stock in providing students with quality educational services and therefore are not entitled to participate in the federal financial aid program.”
An earlier lawsuit filed by the Department of Justice argued many of the same points, stating that EDMC disqualified itself from $11 billion in federal and state funds due its recruitment practices. More