INVESTIGATES: For-profit schools under investigation, still rece - WAFF-TV: News, Weather and Sports for Huntsville, AL

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INVESTIGATES: For-profit schools under investigation, still receiving billions of taxpayer dollars

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(WAFF) -

The Federal Government's attempt to weed out underachieving for profit colleges, schools that serve non-traditional students, is failing.

According to a New York Times report, it is costing the taxpayers billions of dollars. The issue is not new. We broke down the problems and the government's new steps to solve them back in February.  We are back with an update on how some of these same schools are not making the grade, some are under investigation for fraud, but they still have access to your taxpayer dollars.

According to that New York Times report, $8.1 billion is how much money went to for-profit schools under investigation for using deceptive practices. The federal government is trying to crackdown on where those funds go. They are in the process of implementing the Gainful Employment Rules to help curb that cost on you.

Under the rules, programs will have to show that the estimated annual loan payment of a typical graduate does not exceed 20 percent of their discretionary income or 8 percent of their total earnings. But like the New York Times pointed out – some of these schools and their questionable practices still seem to be getting those federal funds.

"We are saying make rules so good schools get money and bad schools don't,” said David Halperin.

Halperin is a Washington D.C. based attorney and Higher Education advocate. He says some of these for-profit schools will lure in students with lofty promises only to leave them saddled with student loan debt and an education that does little to help them in their field of study. 

"Nobody is saying that people should not have the opportunity to try to educate students using a for-profit model,” said Halperin. “The problem has been there have been too many people that have seen this as a way to basically, get free federal aid without helping students because there is no accountability."

And accountability is why the U.S. Department of Education announced the Gainful Employment Rules to begin with. It is a story we alerted you to earlier this year when for-profit schools geared up for the new standards.

Earlier this week, multiple U.S. Senators announced they are turning up the heat on for-profit schools by demanding the U.S. Department of Education immediately take action to stop millions in federal funds from being provided to potentially fraudulent for-profit institutions. The Senators also alerted us to
Alabama and 36 other states Attorney General investigating "various for-profit institutions and collecting evidence of erroneous job placement rates, misrepresentations of credit transferability, and other fraudulent behavior."

We called the Alabama Attorney General's Office to see what's up. They released a statement to us:

“The Alabama Attorney General’s Office is a member of a multi-state group of Attorneys General that regularly shares information and where warranted initiates legal action against certain for-profit education businesses which are found to engage in illegal practices which victimize consumers.”

Halperin said what the Attorneys Generals and U.S. Senators are doing is absolutely what needs to be done. And he will continue to speak out on the issue so we can address the schools not making the grade, your money being wasted, and students not getting the quality education they need.

"We need to get tough on these schools. They need to shape up or we need to stop sending them our tax money and stop sending our students to them," said Halperin.  

We spoke to the Department of Education about for-profit school funding earlier this week. We wanted to know what they plan to do about these schools under investigation that are still receiving billions of dollars. We haven’t received an answer from them yet.  

We are going to continue to press until we have an answer.

To see our original report click here.

To reach out to your Congressional lawmakers about the problem click here.

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