Should For-Profit Colleges Be Federally Regulated

Categories: College

Successfully completing high school is an accomplishment, and graduating from college is an enviable achievement, but being able to find a job with those credentials would be considered a meaningful milestone. Back in primary school, children were taught at a young age to think about the type of career they would have once they “grow up,” as if the transition from childhood to adolescence, then adolescence to immediate adulthood, was not hard enough. With that mindset, the federal education system has instilled a chain of events in their young minds; earn a college degree, attain a career, and maintain money, which ultimately leads to society’s idea of success.

Unfortunately, the newer generations are practically guaranteed an educational world of debt before they can cite their ABCs. Before a successful job comes a successful school life, but who says school, especially college, is free? Education is one of the top priorities, yet the number of student loans has only been piling up and contributing to the federal debt.

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Of course, scholarships and grants are given out to those who are not as financially stable, or to those with high levels of intellect, or to those who have some kind of unique talent, but there is a difference between earning government money and asking for government money. Aside from the well-known community colleges, state universities, and private institutions, a different species of college known as for-profit colleges has been increasing the financial burdens of their students while increasing the amount of money in their pocket.

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Because, the students are pressured into getting more loans to pay for their expensive tuition, but for the for-profit colleges, they continue to receive the revenue from the financial loans given to them through the students. Although the students may be struggling to pay off the debs, the for-profit college would still receive the money. For-profit colleges are known as educational institutions run by one or more private businesses, and despite being named after famous monuments or state capitals, they are neither private nor public educational institutions. (Kirkham) For example, the University of Phoenix may sound like school with accredentials; surprisingly, it a private business which focuses on extorting money from their students. Although previous attempts at regulating the flawed education system found in those for-profit colleges have been struck down, organizations like the Obama Administration have continued to seek viable regulations that can prevent for-profit colleges from hindering the potential futures of their potential students. With the stable regulations, the selfishness and corruption found in for-profit institutions can be extinguished and replaced with financial surveillance. For-profit colleges should be regulated due to the lack of educational benefit, their corrupted education system, the underhanded methods used to recruit new students, the greed found in their managers and recruiters, and the questionable credibility of their degrees and how said degrees will translate into successful career options.

Contrary to popular belief, i.e. the propaganda-like advertising found on their expensive and frequently-played commercials, for-profit colleges are not as educationally beneficial as they seem. When students enroll into for-profit colleges, many trust the words of the college’s recruiters. However, by the time they end up realizing that they received misleading information, it would be too late. For-profit colleges’ students have higher average loan default rates compared to students from public or private institutions (Coutts). In 2012, a study showed that nearly 90% of the students from a for-profit college were left with a $40,000 debt (Snider). However, students who go to a traditional school would graduate with around $20,000 compared to those who attend for-profit colleges. The for-profit colleges would get 90% of their revenue from federal loans, but they would try to get around that by getting the other 10% from veteran loans (Oliver). Some students could not even transfer to another college afterwards because they were buried in debt (Coutts). Online degrees are seen in a negative light compared to regular or traditional degrees (Ashanti). For-profit college’s credits generally cannot be transferred over because of their lack of credentials (Barkley). In fact, two former students of the University of Phoenix were lied to by the recruiters on the transferability of credits (Coutts). Brandon Burke, a recruiter, said that he was told to tell the students that ‘ ‘You say we are regionally accredited, which means that they are transferred anywhere’ but they did not talk about how the credits could be capped or which specific credits would be accepted (Coutts). Another account of a failed transfer occurred when Angelia Baldwin of Aberdeen, S.D., wanted to transfer after 18 months of a $11,000 tuition, but she was told that her credits could not be transferred, despite the fact that she was merely attempting to transfer to another for-profit school. (Kirkham) Unsurprisingly, she wanted to transfer out of one of the biggest yet most troublesome for-profit colleges; the University of Phoenix.  A study shows that the majority of for-profit colleges’ students end up dropping out or failing to get a job after graduating (Coutts). The reason is not because of the students lack of motivation nor due to the overbearing feeling of failure; it is because the for-profit colleges prevent them from being educationally succesful. After going to college, the students accumulate a huge amount of debt, and even if they succeed in graduating, their degrees are useless. Although they have been trying to succeed through their classes, the for-profit colleges are known to put money before education, which leads to the employers into believing that their diplomas are invalid.

The financial burdens that they press onto their students go hand-in-hand with the corrupted education system at for-profit colleges. For-profit colleges are known for extorting a high amount of tuition from their students, but ultimately, they do not help the students prepare for the new world (Barkley). Some undercover inspectors intentionally filled out the wrong answers on the exam, but the school later crossed out and filled out the right answer for them (Coutts). This shows how much the for-profit schools’ credentials may be questioned, and how the schools do not care for the students education. Instead, the for-profit schools are more focused on letting the students pass, because that would allow them to take on more courses and accmulate their student loans. When the for-profit colleges do not have the courses that they need for their major, the counselors are encouraged to pressure the students into selecting another course because a course course, like Psychology (Coutts). By doing so, the students are misled into believing that they completed the courses they need. However, later on they will realize that they would need to retake the certain class, because the certain course they were persuaded to take did not apply to their major. Over the years, Corinthian deceived students by promising them a quick path to financial stability (Barkley), but the students end up learning the hard way. Instead of receiving what was promised, they are left with a huge debt that would take years to repay. In a study (Coutts), it shows that the majority of students who apply into for-profit colleges ends up dropping out of their schools because they cannot afford the tuition. This does affect the for-profit colleges in any way because they already received the money from the students. Even if the students end up graduating from the course, many will struggle to find a job when they graduate, but many more will struggle to keep a status of financial stability (Coutts).

Often, recruiters have to use immoral methods to recruit new students. They will even turn to veterans due to the funds that the government provides for their service. For-profit colleges also target vulnerable people like high-school dropouts, pregnant women, and single mothers. One well-known for-profit school, the University of Phoenix, is known for lying to the students about credit transfers, financial aid problems, and grants (Coutts). They would try to tell the students that the tuition would all be covered by financial aid and their grants, but later on, only then would they realize that they would need to take on extra student debts to cover for their tuition. In fact, undercover inspectors found out that four out of 15 for-profit institutions encouraged the students to falsify their financial documents to be eligible for financial aid (Hannah). Instead of helping the students get financial aid correctly, the colleges were encouraging lying and falsification to earn the revenue through the students. Some for-profit colleges were even seen trying to recruit brain damaged soldiers (Oliver). These brain damaged soldiers would even have a hard time remembering what courses they were taking, but the for-profit college recruiters had a job to do. Mentally or physically damaged, people still have money, and money leads to success. The soldier’s college tuition was paid by the government, which means that the college would still be able to earn money from the soldiers even if they were brain damaged. Therefore, even if the government limited the total amount of federal funds to 90%, the for-profit colleges could still earn the other 10% from the veterans. Although they may not be able earn the other 10% from financial loans, they can still receive it from the government through another method. In 2010, GAO (Government Accountability Office), sent undercover inspectors to 15 for-profit colleges and found unclear, incomplete, or exaggerated information about their program’s duration and costs (Hannah). The fabricated and incomplete information is one of the causes to the act of deceiving students into enrolling in the for-profit colleges. Although it may be immoral to deceive people with misleading information, it is not illegal to do so. In fact, it can not even be considered a scam because they are putting their money into a course. The courses may seem like it is useful, but many of them are rejected from traditional colleges and colleges with accreditation. Critics are worried that students who end up being involved with questionable enrollment methods from for-profit colleges would either graduate or leave with a debt that has accumulated to thousands of dollars (Coutts). Even if the critics are concerned for the students, they can not do anything if the students already invested their money into the for-profit education. There has been cases where the students would try to sue the for-profit colleges for not helping them get a job (Coutts).

For-profit colleges put their own benefits before the educational success of their students. For-profit colleges are known for focusing on money than their education and courses. In fact, numerous students have reported that the school only cares about making money rather than helping the students (Halperin). In John Oliver’s satire, Oliver talks about an interview where the nurses were taken to a museum for their hands-on experience. Instead of looking for a way to improve their credentials and help broaden the future for their students the for-profit schools hinder their students’ prospects instead. University of Phoenix is slowly looking at numbers of enrollment and money instead of helping the students get to the place they want to (Coutts). Many for-profit colleges rely on the federal loans given by the Education Department (Nasiripour). The tuition was four times higher compared to the two-year community colleges (Hannah). Corinthian recently had a lawsuit, which stated that Corinthian made the students pay off the loans while they were still enrolled and they would also be pulled out of their classes if they get behind in paying the loans (Kirkham). Instead of helping their students find methods to succeed and pay off the loans, the for-profit school resorted to taking away their education. This just shows how they care more about the tuition than the students. Federal data shows that for-profit schools spend less money on education but they receive more federal aid than students in traditional schools (Anderson). For-profit schools use more money on advertising their school than improve the materials and the courses given to their college. Although for-profit colleges only have 11% of all college students, they hold 44% of all student loans (Kirkham). For-profit colleges hold such a small percentage in college students, but they hold almost half of the nation’s student loans. Although, the students’ environment may put them in that situation, it’s suspicious how the for-profit schools have such a high percentage. In a study conducted by Oakland California-based Institute for College Access and Success, for-profit colleges has 13% of the nation’s college students but they accumulate up to 46% of all federal loan defaults (Anderson). This just shows how much money these for-profit colleges are receiving. Their tuitions are extraordinarily high, yet their degrees are useless because the education is not reliable.

For-profit schools’ degrees are questionable because of their origins. Some for-profit colleges are known to accept students who do not even have a high school diploma or something equivalent (Coutts). This shows much unreliable these for-profit colleges can because those their standard requirement is super low. Therefore, those with credentials from for-profit colleges fare no better at job opportunities than those coming from the much cheaper community colleges (Snider). In fact, their credentials may be questioned when they search for a job because the majority of the for-profit colleges have no credentials (Ashanti). For example, a group of women training to be nurses were rejected countless times because of the lack of on-hand experience that should have been given by the University of Phoenix (Oliver). The University of Phoenix, instead of giving them the hands on experience, told them to go to a scientology museum for their hands-on experiences (Oliver). Studies suggest that applicants who have for-profit college credentials on their resume do not get called back by the employers as frequently as the graduates who earned their credentials elsewhere (Snider). Unfortunately, non-credential colleges are not as reliable compared to community colleges. However, for-profit colleges use propaganda as a way to seem reliable to potential students. Even though the college seemed like it was a state funded college, in reality, it used the capital’s name to disguise the fact that it was  a privately funded college. The National Bureau of Economic Research studies show that people who earned their credentials from a for-profit college was 22% less likely to hear back from their employers (Snider).

Going to college is only an option, but nowadays it is being treated as a priority, a custom that everyone must abide to. In today’s economy, receiving a thorough and high-level education results in a well-paying job. Not having a stable financial status does not fare well due to the ever-rising federal debt. Education is, in a way, synonymous to significance or importance, yet the student loan debt has not been increasing; instead, it has been steadily increasing, despite the amount of scholarships or grants handed out to those who are capable of earning them. Although loans are inevitable, whether a student is going to a state college or a private institution, the dangerously high number in student loans is found in a rather small community; the for-profit colleges. For-profit colleges have only been coercing new and current students into a world of debt for their own personal gains. Fortunately, an organization called the Obama Administration has come up with a revised set of regulations on the for-profit community. Even though the rules were struck down by an earlier ruling, the lack of educational benefit, their corrupted education system, the underhanded methods used to recruit new students, the greed found in their managers and recruiters, and the questionable credibility of their degrees and how said degrees will translate into successful career options demonstrates the need for regulation. If the new regulations were to represent staples against the wallets of the for-profit colleges, they will no longer be able to rob students of their money.

Works Cited

  1. Anderson, Derrick. “For-profit Universities Are Not Inherently Bad.” Boston Globe Media Partners, 16 Nov. 2014. Web. 17 Nov. 2014.
  2. Ashanti, Kiara. “What Is a For-Profit School – Pros & Cons of Online Colleges.” Your Guide to Financial Fitness. Money Crashers, n.d. Web. 17 Nov. 2014.
  3. Barkley, Whitney. “How For-profit Colleges Rip off Students.” CNN. Cable News Network, 31 Oct. 2014. Web. 16 Nov. 2014.
  4. Coutts, Sharona. “At University of Phoenix, Allegations of Enrollment Abuses Persist.” Journalism in the Public Interest. ProPublica, 3 Nov. 2009. Web. 15 Nov. 2014.
  5. Halperin, David. “If a For-Profit College Becomes a Non-Profit, Is That Good? Not Necessarily.” The Huffington Post., 11 Feb. 2013. Web. 17 Nov. 2014.
  6. Hannah, Elizabeth. “For-profit Colleges Shouldn’t Be Funded.” The Daily Wildcat. SNWorks, 16 Nov. 2014. Web. 17 Nov. 2014.
  7. Kirkham, Chris. “Obama Administration Rules Target For-profit Colleges.”Los Angeles Times. Los Angeles Times, 29 Oct. 2014. Web. 17 Nov. 2014.
  8. Nasiripour, Shahien. “CFPB Accuses Corinthian Colleges Of Cheating Students.” The Huffington Post., 16 Sept. 2014. Web. 17 Nov. 2014.
  9. “Obama Administration Backs Down On For-Profit College Regulations.”BuzzFeed. BuzzFeed, 30 Oct. 2014. Web. 17 Nov. 2014.
  10. Oliver, John. “Student Debt.” Last Week Tonight with John Oliver. HBO, 7 Sept. 2014. Web. 17 Nov. 2014.
  11. Snider, Susannah. “3 Must-Know Facts About For-Profit Colleges, Student Debt.” US News. U.S.News & World Report, 01 Oct. 2013. Web. 16 Nov. 2014.
  12. Svokos, Alexandra. “3 Must-Know Facts About For-Profit Colleges, Student Debt.” The Huffington Post., 06 Oct. 2014. Web. 17 Nov. 2014.

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Should For-Profit Colleges Be Federally Regulated. (2021, Sep 27). Retrieved from

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