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Fifteen State Attorneys General To Investigate Company Marketing For-Profit Colleges To Veterans

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"Fifteen State Attorneys General To Investigate Company Marketing For-Profit Colleges To Veterans"

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Our guest blogger is Lauren Jenkins, a Non-Profit Programs Consultant with ScoutComms where she works on defense and veterans issues.

An Iraq War veteran searching the web for “GI Bill schools” won’t find the Department of Veterans Affairs’ website about Post-9/11 GI Bill benefits among the top results. Instead, he or she will see GIBill.com, a slick commercial site advertising the select schools willing to pay to get their names featured — mostly for-profit schools with low graduation and high loan default rates.

Predatory recruiting practices by for-profit schools have been the target of state attorneys general investigations and lawsuits, advocacy campaigns, Congressional hearings, and an Executive Order signed by President Obama.

Now QuinStreet, the company behind GIBill.com, has come under investigation by 15 state attorneys general — led by Jack Conway from Kentucky — for its role in connecting veterans and servicemembers to its for-profit school clients. As California Watch’s Erica Perez reported today:

In their inquiry, the investigators expressed concerns that QuinStreet’s marketing websites, such as www.GIBill.com and www.ArmyStudyGuide.com, mislead consumers into believing that the sites are affiliated with the government or that the for-profit colleges recommended by the sites are the only ones that accept subsidies such as the GI Bill or Tuition Assistance, which is for service members on active duty.

Currently GIBill.com features multiple disclaimers that it is not affiliated with the government or military, Perez notes, but “an archived version of the website from July 2011 does not include the disclaimer.”

To prevent further abuse by companies like QuinStreet, Obama’s new Executive Order directs relevant agencies such as the Department of Veterans Affairs to “take all appropriate steps to ensure that websites and programs are not deceptively and fraudulently marketing educational services and benefits.”

“Much of it is just deceptive marketing,” said Tom Tarantino, Deputy Policy Director at Iraq and Afghanistan Veterans of America. “You won’t be able to find a public college unless you go three or four clicks in. They’re really advertising. If you enter your contact information on the site, you’ll be subject to aggressive, sometimes harassing, recruiting calls by these for-profits.”

Targeting veterans is incredibly lucrative for for-profit schools and their shareholders not just because billions of dollars in Post-9/11 GI Bill benefits are being paid out.

The “90-10” rule can increase a veterans’ value to a for-profit school nine times over. Under the rule, at least 10 percent of a for-profit school’s revenue must come from non-federal sources if it is to qualify to receive federal student aid dollars. That aid can make up 90 percent of the for-profit school’s revenue.

A loophole in the law counts GI Bill benefits as non-federal revenue. That puts a huge dollar sign on a veteran’s back. For every GI Bill dollar a for-profit school raises, it can raise nine more federal student aid dollars.

Companies like QuinStreet are at the nexus for targeting and connecting veterans to for-profit schools. “The ‘90-10’ rule fosters aggressive recruiting of veterans,” said Tarantino. “We have to fix the loopholes in the law, but where the rubber meets the road is in the states and with their attorneys general.”

Across the country attorneys general are investigating for-profit schools themselves, but finding few common targets. Instead, they have recently turned their focus onto Congress as 21 attorneys general signed a letter requesting it close the “90-10” loophole. Investigations into companies like QuinStreet and their questionable practices that support and enable the for-profit industry must continue to curb the exploitation of our veterans and their benefits.

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