Home News The Policies That Work—and Don’t Work—to Stop Predatory For-Profit Colleges – The Century Foundation

The Policies That Work—and Don’t Work—to Stop Predatory For-Profit Colleges – The Century Foundation

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For-profit colleges do not always recruit aggressively; nor do they always shortchange students. But the problem of colleges systematically overpromising and under-delivering, when it does happen, has largely been a for-profit phenomenon. The abuses have been the most widespread and most damaging when they have been fueled by government grants and loans. A cycle has been created: federal money stokes scandals, regulations are adopted in response, the regulations are then relaxed, and the scandals repeat.1

Why do the scandals keep returning? Some regulations have lost their effectiveness over time because the industry finds ways to comply with the letter but not the intent of the rule. In other cases, lawmakers actually relaxed the regulations because the protections worked—as if because it’s dry under the umbrella, the umbrella can be ditched. Usually this occurs after industry lobbyists make the case that the “bad actors” are gone and that regulations should be relaxed to allow for more “innovation.” Corinthian Colleges and ITT Tech both played leading roles in pressing Congress to relax the rules that facilitated their subsequent multi-billion-dollar ripoffs of students and taxpayers.

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