Barbarians in the Ivory Tower

America's for-profit colleges offer education only a con man (or a congressman) could love.

Worse, the classes themselves had less content than a political soundbite. "When I saw what they were passing off as college, I was appalled and mortified," Bittel says. "I'm a fabulous salesman if I believe in my product. But I was blown out of the water. I couldn't sell it anymore."

On the sales floor, she would soon go from golden child to problem student. Managers threatened to fire her. She protested that she'd excelled at EDMC's other barometers, like leadership, calls made and conversations engaged. None of that mattered, they told her.

"Those are just put in there because the law says we're not allowed to pay you directly," she recalls her boss saying. "We don't look at those. Those don't really matter. The only thing that matters is how many bodies you bring in."

"It's basically consumer fraud rendered to a business model," Barmak Nassirian says.
Courtesy of Barmak Nassirian
"It's basically consumer fraud rendered to a business model," Barmak Nassirian says.
Suzannne Lawrence, who worked as a recruiter at Argosy University, says the pressure to recruit students prompted all sorts of illicit shenanigans.
Courtesy of Suzanne Lawrence
Suzannne Lawrence, who worked as a recruiter at Argosy University, says the pressure to recruit students prompted all sorts of illicit shenanigans.

Bittel wasn't the only worker feeling the pressure. A man she carpooled with would cry on the way home.

"If you weren't unscrupulous, you struggled," she says. "Half the people I worked with, their previous job was in the mortgage industry. They targeted people in that industry. ... They were the ones that did the best because they were so unscrupulous."

She eventually transferred to EDMC's career-placement department, where the same deceit wore a different outfit.

She was supposed to help Art Institute grads find jobs. But the school was churning out students with abysmal portfolios — if they had portfolios at all.

She was also supposed to generate stats on how many of them found employment in their fields. The numbers were used to not only sell future students, but by accreditors in maintaining a program's standing. So EDMC, she says, was prepared to rig these stats by any means necessary.

Bittel's boss liked to say that "every student is place-able. It's all a matter of technique." This "technique," she says, involved convincing people to sign affidavits saying they were employed in their field. She witnessed cases where someone with a degree in video game design was counted as working in his field because he sold video games at Toys "R" Us. She was told to convince a Starbucks clerk that making the menu sign each day was using her graphics-design degree.

Once, Bittel saw a co-worker lying on a form about a graduate's salary. The same employee showed her how to doctor emails so that students' replies favored the Art Institute. Both times she reported the scams to her boss. But instead of being fired, the coworker soon received EDMC's North Star Award for exceptional performance.

EDMC is hardly alone in its transgressions. Two years ago, the feds conducted a sting on for-profit colleges, with investigators masquerading as prospective students. They tested the sales practices of 15 schools. Four encouraged outright fraud. They were all found to be deceptive.


Congress Sees No Evil

In the age of austerity, you'd think Congress would be anxious to root out waste, especially after allowing mortgage fraud to decimate the economy. But money talks loud enough to make any congressman hard-of-hearing. So despite a 20-year history of fraud and failure, for-profit colleges appear as bulletproof as ever.

Washington's been aware of the racket since Democratic U.S. Senator Sam Nunn of Georgia held high-profile hearings in 1992, demonstrating how for-profits were recruiting students from welfare offices, housing projects and homeless shelters — anything to get bodies through the door. They were subsequently barred from paying salespeople based on enrollment.

It would take just a decade for Washington to eviscerate these protections. In 2002, President George W. Bush created a series of loopholes and announced that violators would no longer be punished.

Then Bush and Republican Congressman John Boehner of Ohio opened the door even wider, working to repeal a rule that required schools to educate at least 50 percent of their students on-campus. It gave birth to an online gold rush, with for-profits flooding the internet. Last year, 6 million students enrolled.

The industry had discovered the value of paying protection money to Congress. It spent $16 million on lobbying last year alone, buying a dream team of former officials that include former Missouri Democratic House Majority Leader Dick Gephardt and no fewer than 14 former congressmen.

"I didn't know when I got into the issue of for-profit schools that it was the best way for me to have a reunion with every member of congress as they parade through the door, all representing these schools," says Illinois Democratic U.S. Senator Dick Durbin, who's held hearings investigating for-profits. "There is so much money on the table they can afford to hire everybody."

Needless to say, Durbin hasn't gotten far with his probe. He's found some support among fellow Democrats, but not a single Republican bothered to attend his hearings.

"I don't want to hear their sermons from the mount about wasting federal money when they won't even take a look at these obscenely subsidized for-profit schools," he says. "If they were talking about food stamps, they would cut people off in a second for this level of fraud. This is a wasteful expenditure of hard-earned consumer dollars to some of the wealthiest people in America, and that has to come to an end."

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12 comments
theEuphoriac
theEuphoriac

Guess writing about how sketchy these for-profit universities are is good enough. Because the full page ad for Argosy University on pg. 12 of this weeks Observer just doesn't send the same message. I get that the Observer needs funding, but you couldn't even make it two weeks? Village Voice ftw...

gigabytmaster
gigabytmaster

For-profit "schools" shouldn't even be legal, let alone able to get away with this level of fraud.  Sad thing is, though, a lot of this doesn't sound that much different from my experience at UTD's Jindall School of Management.

londoncalling
londoncalling

I was enrolled in a for profit school program for graphic design in the early 1990's. I decide after 4 months that it was not for me and was not on the up and up. Meaning there were computer graphics coming on the scene and this school (college) had no computers available and was not looking into getting any either.

I was told by the financial aid office that I was responsible for the loan that I had taken out and would need to pay that back to the government or to Sallie Mae.

I said forget about that and started researching the school and the members of the "Oklahoma State Board for Private Schools that served as the "watchdog" over these private school and any improprieties. 

I found out that the people that owned the private colleges were no only on the Oklahoma State Board but the man that owned the school I was attending was the President of the Board!

So I decided to attend their meeting and state my case in front of the entire board!

Needless to say my loan was "forgiven" and I never heard from them or Sallie Mae again!

Perhaps if more students did something simular these school would close up and go away permanently... 

ThePosterFormerlyKnownasPaul
ThePosterFormerlyKnownasPaul topcommenter

Be careful what you ask for, you just might get it.

 

Why should neither the for-profit schools nor Congress be worried about the money?  After all, it was someone elses money.

TheCredibleHulk
TheCredibleHulk

...get your degreeeeeeee..... set yourself freeeeeeeee........

 

National-American-Universiteeeeeeeeeeeeeeeeeee!

 

*smiles, humming*

roo_ster
roo_ster

VVoice is just carrying water for lefty academics who don't like competition.  The larger problem is not-for-profit colleges, many of which have the same danged problem, but are too poorly run to have any money over at the end of the day.  The higher ed bubble will burst pretty soon and the cocooned & mostly un-hireable academics will be slapped in the face by reality.  The various for-profit schools will be part of the solution after the bubble bursts.

numapompilius
numapompilius

sounds like a real redistribution of wealth underway.(taking from the poor and middle class to give to the rich)

texasnative3
texasnative3

I'm not sure Bobby can be held to the contract since he was a minor when he signed it.  Perhaps Bobby should speak with an attorney.

J_A_
J_A_ topcommenter

South Harmon Institute of Technology

Sotiredofitall
Sotiredofitall topcommenter

"Higher Education" has become a scam on many levels, not just at the for-profit outfits.  The UT Austin football program had operating profit with $70.1 million in fiscal 2010 and I still get phone callas asking for donations to support school academic programs.

cynthia.beard
cynthia.beard

 @roo_ster You obviously didn't read the article but are just spouting typical, tired partisan rhetoric. 

livinginlarue
livinginlarue

 @Sotiredofitall  Add to that the practice of high school administrators  to push ill prepared students into ANY type of higher education in order to improve the school's stats and you have a real problem.  There was a counselor at a school I taught at that comvinced an economically disadvantaged special ed student that she could go to community college on student aid.  She could only take "developmental" classes and after two years had no college credits and a debt she will struggle a lifetime to repay.

 
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