For decades, for-profit colleges have used deceptive marketing to recruit veterans into expensive, practically worthless degree programs and mountains of debt. Veterans and their families are asking the Department of Education to lock the door on these predatory schemes in the new year. Who will the department prioritize, veterans or for-profit schools? The department will hear from both stakeholders in the coming weeks as it holds hearings to inform the regulations required by a vital new law that Congress passed in 2021.
Fraudsters first targeted veterans for their GI Bill benefits after World War II. Congress responded with a series of protections, eventually including the “90/10 Rule.” That rule is a market viability test requiring for-profit colleges to provide enough value to attract at least 10 percent of their revenue from employers or private sources, thereby protecting taxpayer dollars from being used to artificially prop up failing colleges. But there was an inadvertent loophole in the rule: It failed to mention GI Bill dollars.
Since then, for-profit colleges have zealously pursued veterans, knowing the GI Bill “gravy train” would keep on rolling unabated. Their marketing falsely promises veterans a great education that will lead to a job. Yet, they fail to mention that their average graduation rate is 26 percent, their credits rarely transfer to other institutions, and most employers disregard their degrees.
They tell veterans the GI Bill will cover all the costs and then charge them extra fees, leaving them with six-figure student debt. Sometimes, they outright lie about accreditation and financial assistance and then take out loans in veterans’ names.
In March, Congress finally closed the loophole, clarifying that the 90/10 Rule must include “all federal funds,” but the law won’t take effect until the Department of Education implements the law in regulations. The for-profit college industry has responded with a lobbying blitz to create more loopholes, special exemptions and carve-outs to keep GI Bill dollars on the menu.
Service members, veterans and their families are asking the department to finally put a stop to the scams. The department has a responsibility to students, taxpayers and Congress to follow the law’s unambiguous intent.
In December, the department held public hearings to inform the new regulations. On one side were lobbyists for the for-profit college industry, who know that 87 institutions — where a majority of students attend with military aid — are so subpar that they fail to attract even 10 percent of revenue from employers or private students. On the other side were veterans who told shocking stories of being cheated by these programs.
Dylan Contrino, a Marine Corps veteran, enrolled at a technical institute to start a career in welding after recruiters told him GI Bill benefits would cover the program. He says school representatives promised federal stipend checks that never arrived, and then took out huge loans on his behalf. Contrino discovered the program was not accredited with Veterans Affairs for aid in the first place.
Another university’s recruiters promised Mikael Swenson, an Army veteran and Purple Heart recipient with service in Afghanistan, that its music production program would pair him with a job after graduation. The school did nothing to help him find employment in his field. Now in his 30s, Swenson is starting from scratch at a community college. His credits from the for-profit school won’t transfer to other institutions, and the school consumed his GI Bill benefits, so he had to take out student loans.
Christopher Glock, a Marine Corps veteran, had an idea for a digital system for mom-and-pop restaurants. He enrolled at a technical school, which soon shuttered its doors when the Education Department cut off federal loans following several fraud investigations. Recruiters for another for-profit college told Glock he’d learn web design and programming languages and get a job in tech after graduation. When the pandemic struck, the school sent him YouTube videos to watch instead of offering real classes.
For-profit colleges such as these aren’t just exploiting veterans; they’re ripping off taxpayers. Americans expect federal education benefits to provide veterans with the education and career opportunities they’ve earned. Instead, billions of dollars continue to line the pockets of for-profit college executives and their shareholders.
As we start 2022, the Department of Education should move to comprehensively ensure a clean closure of the 90/10 loophole. The department must prioritize service members, veterans and their families to make this the year our community represents “dollar signs in uniform” no more.
Will Hubbard, a Marine Corps veteran, is vice president for Veterans and Military Policy at Veterans Education Success, a nonprofit organization that advocates for the protection of the integrity of the GI Bill and other federal, postsecondary education programs.