Why are for-profit schools facing such scrutiny? On one level, it's obvious -- they're in business to make money. There's nothing wrong with that except that under such circumstances schools might take students who will face a hard time paying the bills. As Bloomberg notes in this story,
Today, one in seven minority students attends a for-profit college, as does one in four poor students who receive federal Pell grants for low-income families, according to the U.S. Department of Education and an industry group. Students in for- profit college programs graduate or stay in school less than those at community colleges, according to a study sponsored by the U.S. Department of Education and released this month.
Then there are the recruiting practices that critics say border on the unethical. Consider an excerpt from this report:Students in two-year programs at for-profit colleges are also eight times likelier to be in debt than those at community colleges, according to a report last month from the Education Trust, a nonprofit advocacy organization based in Washington.
For-profit colleges enroll 12 percent of U.S. undergraduates and consume 24 percent of U.S. Pell grants for low-income students.
Now those colleges, after flourishing under loosened regulations during George W. Bush's presidency, are under attack from President Barack Obama's administration, which wants to tighten the rules. Stock prices for the parent companies of for- profit colleges have plunged.
The colleges use deceptive practices to lure homeless people, veterans and individuals who aren’t prepared for college into unsuitable courses in order to obtain tuition funded by grants and also by federal loans that students have trouble repaying, according to advocates for the homeless, veterans’ groups and current and former students. Almost 90 percent of Phoenix’s students use federal grants or loans to pay tuition.One critic left little doubt what he thinks of the for-profit educational companies: