For-Profit Colleges Mislead Students


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On May 4, 2010, we posted an article on this blog and at the home page of Career Coaching for Students™ entitled PBS Frontline Exposes Fraud at For-Profit Schools. Obviously we have to give PBS credit for the story. Now it seems the General Accounting Office (GAO, United States Agency) has published their findings which are both confirming the PBS story and very damning for the “For-Profit Educational Industry”. These “for profits” offer “extensive career planning and placement programs” which has been the enabler for the “for-profit college industry” to secure significant market share in the higher education industry.

According to the United States Government Accountability Office (GAO), nearly two million students attend for-profit colleges, pursuing bachelor’s and associate’s degrees in disciplines that range from cosmetology to nursing and engineering. In 2009, for-profit colleges received more than $20 billion in federal loans and grants. These are powerful institutions that students, the government, and employers have trusted with a significant part of our society’s future. Knowing this information, you can imagine the outrage and shock that accompanied today’s GAO report that implicated 15 for-profit colleges in deceptive recruiting & career planning practices.

Of the 15 colleges tested, four institutions were guilty of fraud in their aggressive and misleading marketing techniques. As part of the GAO’s undercover investigation, four agents posed as prospective students and met with admissions staff for financial aid, tuition, and career planning information. The test revealed the following questionable marketing practices:

  • One for-profit college encouraged an applicant to hide $250,000 worth of assets on a federal financial aid application
  • According to The New York Times, another college encouraged a student to lie about dependents on a financial aid application 
  • Admissions representatives misrepresented tuition costs, quoting the price of classes for nine months instead of one full year
  • Students were provided with false career planning advice. For example, one program mentioned that barbers could earn up to $250,000 annually. According to the Bureau of Labor Statistics, 90 percent of barbers earn $43,000 per year.
  • One admissions representative undermined the financial burden of student loans, implying that defaulters cannot be held accountable for missed payments
  • Admissions representatives engaged in aggressive marketing strategies, pressuring the undercover agents to sign contracts even if they weren’t ready to make a decision.

Although the names of the 15 for-profit colleges remain confidential, the surveyed programs were in a number of disciplines, offering both associate’s and bachelor’s degrees in subjects ranging from business to cosmetology. This information coincides with an education record.

According to the Bureau of Labor Statistics, 70 percent of high school graduates from the class of 2009 were enrolled in a two-year or four-year program when surveyed in October ’09 — the highest number in United States history. While this is a figure worth celebrating, it is also indicative of a growing issue – proper career exploration and planning.

How many of these students are making informed career decisions when choosing a program to attend? How many of these students will position themselves to guarantee a return on investment, and how many will drown in debt upon graduation, falling victim to aggressive marketing practices, false career planning advice, and unrealistic expectations about career prospects? Whether or not students have fair access to objective information, they are still responsible for the costs and consequences of their education and career planning strategy.

Of all the concerning questions, how many students, by taking the bait at these fraudulent institutions, are missing out on a career that would have been much more fulfilling and resulted in greater success?

Students have to make adult decisions with real consequences at a very young age. The issue isn’t whether students are mature enough to choose and plan their careers. The issue is around access to solid, credible career coaching for students. As a society, as parents, as teachers, and as students, it is more important than ever that career coaching be provided to all students.

If you’re not investing a substantial sum of money, you are investing a substantial amount of time, so be an educated consumer when shopping for a college. Just as you would compare the economic implications of buying a car, you should compare the economic implications of your degree, college, and program relative to career interests. In addition to looking at rankings, prestige, and marketing materials — regardless of whether you are looking at a nonprofit or for-profit college — weigh the economic and educational return on investment. Our students are our future’s most valuable asset, so let’s position them to be successful.

A GREAT OFFER TO READERS OF THIS BLOG – UNLIMITED ACCESS TO STUDENT RESOURCE CENTRAL™ FOR ONLY $19.95: The Career Coaching for Students™ website has an extensive private area for career and educational research that is normally reserved for our individual and workshop clients. Each resource has been evaluated for its quality, value and ethical representation of information. We call it Student Resources Central™. Due to the new, alarming information about corrupt “for-profit” institutional practices, we are offering the full Student Resources Central site to parents** and students for $19.95 per access license. This is a unique offer and the access has no expiration. If you are a high school administrator or teacher and would like to gain access to the site for all of your students we offer the same price to you also. This one-time purchase provides access with no expiration. To buy an access license go here. Aren’t sure it is worth it? We guarantee your satisfaction* or we’ll give you a full refund and we’ll eat the credit card fees.

*Guarantee will be honored for 30 days. After 30 days we figure you found the site helpful.
**This offer is not available to professionals or organizations that offer career guidance services, tools or products. For more information on becoming a Career Coaching for Students™ Licensed Facilitator which includes full rights to use Student Resource Central  with all of your customers contact Carl Nielson at 972.346.2892 or visit our Coach Facilitator information page on the website.

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