The Business of Higher Education

Higher education is a multi-trillion dollar industry in the US, if you include endowments, land, and other investments.  Journalists and policy people who cover the industry are often quick to put schools and their related businesses into distinct categories, but these categories are oversimplified.  One of the biggest oversimplifications is in categorizing schools as "for-profit" and "non-profit."  

For-profit higher education has typically referred to institutions operating as profit-seeking businesses, but this ignores three centuries of history, economics, and public policy showing the intermingling of for-profit institutions and non-profit enterprises with a for-profit mentality.    

For-profit schools and the for-profit mindset are not new to US education.  While elite private religious based colleges were the first schools of higher education, proprietary training was also available during the late 1700s.  It could be argued that even then, elite colleges could not have grown without the benefits of enslaving their labor, the ultimate in greed and depravity.   

After the US Civil War, through federal legislation (the Morrill Act), state flagship universities were "granted" land stolen from indigenous nations. Private and public black colleges were also formed.  For-profit business and trade schools also sprang up in many American cities, serving a growing demand for entrepreneurs and skilled labor. Private non-profit colleges followed suit.  As early as 1892, University of Chicago started a correspondence school, a money-making strategy copied by Penn State, University of Wisconsin, and many other universities.  

Since the early 20th century, critics have complained about money rather than academics driving traditional university leadership. Thorstein Veblen's book  The Higher Learning in America (1918), was subtitled, "A Memorandum on the Conduct of Universities by Business Men."  Yale and Harvard also brought on football, which was a big money maker for the schools in the early 20th century. In the Goose-Step (1923), Upton Sinclair named names of those with wealth, power, and influence--including a number of robber barons.  

With the help of government funding, higher education grew by leaps and bounds after World War II (the GI Bill) and into the 1960s and 1970s (Pell Grants and federal loans).  State universities and community colleges grew in number.  In 1972, with the reauthorization of the Higher Education Act, proprietary schools gained access to these funds to become a larger player in US higher education.  

By the 1980s, the for-profit University of Phoenix (UoPX) became a pioneer as a mega-university, a  school of over 80,000 students with an emphasis on adult learners, convenience, and a business attitude.  For-profit schools gained legitimacy as universities like Devry and UoPX became regionally accredited and others created their own national accreditors.  In the 1980s and 90s for-profit colleges grew as they became publicly traded corporations with enormous profits and political power. 

With profit-driven schools, academic labor was faced with unbundling, where components of the traditional faculty role (e.g., curriculum design) were divided, while others (e.g., research) were eliminated.  Colleges resembled academic assembly lines rather than bastions of wisdom.  But the marginalization of academic labor was not reserved to for-profit schools.  

As this great unbundling was occurring, state flagship universities became enormous research institutions with multiple missions, many of them profit driven.  Proponents of privatization, outsourcing from for-profit companies, have said that it "helps universities save money and makes them more nimble and efficient." Moody's Dennis Gephardt, however warns that "more and more are cutting closer to the academic core." 

Since the 1980s commercialization in nonprofit and public higher education has accelerated, with universities increasingly involved in enterprises focused on generating net revenue, such as licensing of patents. Indicators of for-profit incursions into nonprofit and public higher education may include university medical centers, corporate sponsored science labs, for-profit mechanisms such as endowment money managers, for-profit fees for service, for-profit marketing, enrollment services and lead generation, privatized campus services, for-profit online program managers (OPMs), privatized housing, private student loans, student loan servicers, student loan asset backed securities, and Human Capital Contracts, also known as income share agreements.

For-profit college enrollment has been in decline since the 2010-2011 school year.  University of Phoenix and Devry are shadows of their former selves,  and two other big schools, Kaplan University and Ashford University have been transformed into arms of two state universities, Purdue University Global and University of Arizona Global Campus.   

But proprietary colleges have not been the only type of colleges in decline.  Community colleges and second tier public and private colleges also reported significant enrollment and revenue losses.  Community college enrollment, in fact, has declined in absolute numbers more than for profit colleges.  

During this decade long decline, what I have referred as the College Meltdown, for-profit mechanisms have gained even ground as government aid and institutional bonds fill in revenue gaps.  Today, US higher education marketing and advertising is ubiquitous. The Harvard Business School operates in many ways like a for-profit enterprise.  And many elite schools rely on predatory for-profit online program managers to recruit students for elite certificates, adding some pocket change to their already bulging resources. 

Predatory Colleges, Converted To Non-Profit, Are Failing (David Halperin)

About a dozen years ago, owners of some of the biggest, worst-acting for-profit colleges began concocting, with their eager, high-paid lawyers, schemes to convert their schools into non-profits. The apparent aims were to evade the heightened government regulations applied uniquely to for-profit schools in order to guard against waste, fraud, and abuse — and to escape the growing stigma that the industry’s predatory behavior had placed on for-profits.

The clever schemes have come in various colors, yet most of them potentially allowed the sharp operators to keep making big money off the schools they no longer formally owned but, one way or another, still controlled. These dubious deals, mostly blessed by servile government departments and accrediting agencies, have made a mockery of non-profit rules, and, much worse, have helped sustain another decade of predatory college abuses against students and taxpayers, resulting in the waste of billions of dollars and the ruining of the financial futures of tens of thousands of people — veterans, single moms, and others — who sought better lives through higher education.

Yet, just as the private equity owners of the University of Phoenix, historically one of the biggest for-profit schools, are now trying to execute yet another dubious version of this scheme — getting a pile of cash by unloading the school on Scott Green, the hubristic president of the University of Idaho, and potentially allowing the current, high-paid executive team to stay employed — it seems, increasingly, that many of these non-profit conversions are not just harmful to the public but also ultimately unsustainable for the operators.

Here’s what’s been happening lately:

— Last week, the Federal Trade Commission sued Grand Canyon University and its CEO, asserting that the school deceived doctoral students about the costs and course requirements of programs — and about the school’s claimed nonprofit status. The FTC also alleges that Grand Canyon engaged in deceptive and abusive telemarketing.

The FTC lawsuit follows an October announcement by the U.S. Department of Education that it is imposing a $37 million fine on Grand Canyon based on similar allegations.

Grand Canyon CEO Brian Mueller has responded to the FTC and education department investigations with a remarkable series of pronouncements suggesting that the moves against his self-proclaimed Christian university are rooted in religious or ideological bias. But, in reality, Grand Canyon’s troubles with regulators began not in the Biden administration, which has cracked down on for-profit college abuses, but under Trump education secretary Betsy DeVos, a Christian conservative who staffed her office with former for-profit college executives and did almost nothing else over four years to hold predatory colleges accountable.

Grand Canyon in 2018 had restructured itself into two entities: a non-profit college, GCU, and a for-profit company, Grand Canyon Education (GCE), that gets paid to provide a range of services to the school. Even though the IRS already had declared GCU a legitimate non-profit, the DeVos Department of Education in 2019 rejected the school’s bid for preferred non-profit status under federal education rules, concluding that “the primary purpose” of the Grand Canyon conversion to non-profit was “to drive shareholder value for GCE with GCU as its captive client — potentially in perpetuity.” The DeVos team couldn’t help but notice that Brian Mueller is the well-paid head not only of the non-profit school but also of the for-profit company has been getting about 95 percent of the non-profit college’s revenue.

Together, the Department and FTC actions call into question not only the integrity of Grand Canyon’s recruiting and academic operations, but also its effort to be accepted as non-profit.

— Last month, the Department of Education took another step to hold accountable the non-profit Center for Excellence in Higher Education, whose schools, the largest of which was Independence University, shut down in 2021. The Department demanded $23 million from CEHE to pay for “closed-school discharges” — reimbursement for cancellation of federal student loan debts that former students had owed the government. The Department in July already had cancelled $130 million in federal loan debt from former CEHE students, citing school misconduct; the Department could potentially seek to recoup all those funds from CEHE.

The ultra-wealthy Ayn Rand disciple Carl Barney owned the schools until 2012, when he sold them at a hefty valuation to CEHE, a small non-profit that he controlled. Seemingly sleepy career officials at the Department of Education approved the transaction in the Obama years, but public scrutiny raised doubts about the appropriateness of the deal.

Like Grand Canyon, CEHE’s abuses were by no means limited to the terms of the non-profit conversion. In 2020, a Colorado court found the company had engaged in systematic deceptive practices. Barney’s schools, the court concluded after an extensive trial, used a detailed playbook to manipulate vulnerable students into enrolling in high-priced, low-quality programs; directed admissions representatives to “enroll every student,” regardless of whether the student would likely graduate; greatly overstated starting salaries that graduates could earn; and falsely inflated graduation rates. CEHE has been pursuing an appeal, but in 2021, the accrediting agency for the schools withdrew approval, citing performance failures, and the Department of Education soon after tightened the screws on federal aid, precipitating the schools’ closure.

CEHE is a mess. It no longer runs any schools or gets any federal aid; instead its functions seem to be limited to trying to get former students to pay back the sketchy, high-interest private loans the school peddled, and engaging in legal disputes with the federal government; these include a pending fraud lawsuit filed by a CEHE whistleblower and joined by the Justice Department, an investigation of CEHE’s private loans by the Consumer Financial Protection Bureau, and a lawsuit for $500 million brought by CEHE against the government alleging the schools were “a victim” of a campaign by the Department of Education “in coordination with ideological confederates… to cripple and close as many private career colleges as possible.” The Department also has suspended CEHE CEO Eric Juhlin from federal contracting.

— Another of the worst predatory for-profit schools is Ashford University, whose corporate owner Zovio pursued several different schemes for a non-profit conversion before finally selling the college to the University of Arizona, whose president, Robert Robbins, had been pressured by state regents to expand its online offerings.

Zovio’s scheme was to hide behind the prestige and political power of a big state university and yet keep getting for itself hundreds of millions off the school, now called University of Arizona Global Campus, through a long-term contract to provide recruiting, academic, and other services.

But that plan was thwarted after a California judge, in 2022, found Zovio liable for blatant deceptions of Ashford students and imposed $22 million in penalties. By law, the California judgment should compel the Department of Education to terminate federal aid to the school. Although Zovio pursued an appeal, it was discredited, bowed out of its contract to serve UAGC, transferred its infrastructure to the University of Arizona, and shut down.

But, with Zovio out of the picture, what was obvious to some even before the deal closed seems to have played out: Most of what Arizona had purchased, most of what made money, was not some supercharged high tech education platform but instead a predatory playbook and a staff trained to execute it. UAGC may not be able to pay its bills even if it keeps up with Ashford’s old predatory practices, but it almost certainly can’t do so if it tries to go straight. In November, President Robbins admitted that the University of Arizona’s overall financial situation is fragile, with cash reserves below minimum levels. Robbins said the school had “overinvested,” and school document revealed that one such exertion was the deal to buy Ashford, which “added $265.5 million in operating costs…”

Arizona’s financial woes from the Ashford deal may grow. Former Ashford students say they were ripped off and, as a result, have applied to have their federal student loans cancelled under a provision of law called borrower defense to repayment. In August, the U.S. Department of Education said it would cancel $72 million worth of loans because of Ashford’s deceptions. The Department also said it would use its legal powers to recoup those funds from Ashford’s owner, meaning the University of Arizona. UA says in response it had “absolutely no involvement in, and is not directly or indirectly responsible for, the actions of Ashford and its parent company” and will be “assessing its options.” But, reading the school’s agreement with Zovio, Arizona may be out of luck on that score.

— In contrast to Zovio’s fate, Graham Holdings has not been forced out of the 2017 deal in which it sold predatory for-profit Kaplan University to an Indiana state institution, Purdue University. Graham continues to hold a contract to provide a wide range of services to the school, now called Purdue University Global — a deal that Purdue is locked into for a 30-year term.

The Graham/Kaplan schools repeatedly faced law enforcement problems for predatory abuses against students before the sale. But the schools did better exercising political influence: The company’s head, Donald Graham, is a hyper-connected Washington insider; the business, long run by his family, was previously called The Washington Post Company, before it sold the newspaper to Jeff Bezos. Graham exploited his power and connections in DC to become the most effective lobbyist pressuring the Obama administration and Congress not to push too hard on for-profit college accountability; his protege Jeffrey Zients held key positions in the Obama White House, as did Anita Dunn, whom, once she left government, Graham hired to tell his schools’ supposedly compelling story to lawmakers. Dunn and Zients are now perhaps the two most powerful staffers in the Biden White House.

Having utilized his tight connections to key Democrats in the Obama years, Graham then took advantage of the lax regulatory environment under Republicans Trump and DeVos to do his troubling non-profit conversion deal with another top Republican politico, then-Purdue president Mitch Daniels, a former Indiana governor and White House official, who may have been dazzled by Graham’s big money ties, including his status as an ex-Facebook board member, and seen Kaplan as the road to a high-tech future.

But this effort to put state college lipstick on a for-profit pig may be failing as well. As Forbes noted last month, Graham Holdings‘ November filing with the SEC says Purdue Global owes the company $127.8 million — perhaps more than the school, structured as a non-profit associated with Purdue University, would be able to pay. Cutting costs at the school in order to pay Graham Holdings’ fees would likely mean lower-quality educational programs. Boosting enrollment for lower-quality programs would likely mean accelerating the deceptive recruiting practices, targeted at low-income Americans, that sullied Kaplan in the first place. Doing all of that at a time when the Biden administration, to its great credit, is working diligently to hold predatory schools accountable would be risky.

Don Graham’s best shot at continuing to make millions off Purdue Global may be for his long-time allies in the Biden administration to fail this year, and give way again to a president Trump, who once ran his own scam real estate school and likely would identify with Graham’s sense of victimhood about the persecutions of great for-profit educators.

— Finally, there is ultra-wealthy Arthur Keiser and his Keiser University, whose 2011 conversion from for-profit to non-profit was comparable to Carl Barney and CEHE: a sale of the for-profit school owned by Keiser, at a remarkably high valuation, to a non-profit controlled by Keiser. In addition to the inflated loan payments Keiser has since received from the non-profit, there are a range of businesses owned by Keiser that sell various services to the non-profit. Even worse, as we have documented, there is a highly questionable mingling of resources and personnel between the non-profit Keiser University and Southeastern College, another for-profit school owned by Arthur Keiser and his wife.

Keiser University seems to have come the closest to thriving after a shady non-profit conversion, but its troubles are now growing.

Arthur Keiser has gone all the way to the U.S. Supreme Court, with his expensive lawyers trying, but so far failing, to block a landmark court settlement aimed at cancelling the student loan debt of hundreds of thousands of ex-students who have filed borrower defense claims, saying they were deceived by their schools. His complaint is that Keiser University was, for purposes of the deal, unfairly placed by the U.S. Department of Education on a list of presumptively bad-acting colleges when, he insists, “There’s no evidence of misconduct.”

But Keiser’s claim of innocence is just another deception.

Like all the other schools with troubling conversions, Keiser University also has repeatedly gotten in trouble with law enforcement, and settled claims, including with then-Florida attorney general Pam Bondi and with the U.S. Justice Department, over allegations of deceptive and unlawful recruiting practices. And recent staff members have told us about predatory behavior still happening at the school, including recruiting of low-income people seemingly unprepared for college programs and of people with insufficient English language skills to understand the course work.

Keiser University also has been in trouble recently with three different accreditors of specific school programs, who have placed the school on warning, probation, or show cause status due to concerns about matters including program effectiveness and certification exam passage rates.

The non-profit conversion also has, finally, gotten Keiser University in trouble; the school admitted under congressional questioning in 2021 that the IRS imposed a penalty on the school for improperly steering profits to Arthur Keiser by entering into leases above fair market value with Keiser-related for-profit companies. Senior Democrats in Congress, including senators Dick Durbin (D-IL) and Elizabeth Warren (D-MA) have called on the U.S. Department of Education to investigate Keiser’s schools, which have received billions in taxpayer-funded student financial aid.

And, in November 2022, the Department determined that Keiser University’s accreditor, SACS, was out of compliance with numerous federal regulations and directed it to provide more information regarding its oversight of Keiser University and the school conversion to non-profit.

As part of the Department of Education’s regular oversight process for accreditors, I recently wrote to the Department, for a second time, urging it to hold SACS accountable unless it takes steps to address the conversion deal and predatory practices at Keiser’s schools. I hope that will happen, and that the Department itself will take steps to protect students by imposing conditions on Keiser’s future receipt of federal aid.

— Conversion from for-profit to non-profit has not prevented serious financial and / or legal problems at all of the schools we’ve discussed. In recent years, government regulators, accreditors, courts, and students have seen through the conversions, recognizing that predatory for-profit schools — with greedy owners, deceptive practices, poor value educational programs, and low return on student and taxpayer investment — remain predatory schools even when dressed up as non-profit colleges or big state universities. (The conversion of another huge predatory chain, EDMC, to non-profit also has been a disaster.)

Yet somehow the president of the University of Idaho, Scott Green, continues to insist he will be serving his school, and students, by acquiring, through an affiliated new non-profit, the giant for-profit University of Phoenix from huge private equity firm Apollo Global Management. Green remains determined to buy and run Phoenix despite Phoenix’s long and continuing record of abuses and law enforcement problems, despite the enormous potential liability Idaho might assume for debt cancellation for former Phoenix students, and despite opposition from many leaders in his own state, as well as advocates for students across the country. If Green — whose team keeps claiming, falsely, that Phoenix is under honest new management — and the Idaho state board of education can’t look objectively at the evidence that past conversions have been a moral disgrace, and a disaster for school operators, as well as students and taxpayers, then others in his state, the University of Idaho’s accreditor, and the U.S. Department of Education, should act to block the deal.

[Editor's note: This article originally appeared on Republic Report.]  

For-Profit College Barons Backed Trump, But Now May Be Scared (David Halperin)

Many top for-profit college industry owners supported Donald Trump’s bid to return to the White House. They had benefitted when, during Trump’s first term, his education secretary, Betsy DeVos, largely ended federal regulatory and enforcement efforts to hold for-profit schools accountable for deceiving students and ripping off taxpayers. But some industry barons, having contributed to the Trump 2024 campaign, now may be scared by efforts of the new Trump administration, including Elon Musk’s DOGE team, to disrupt operations of the U.S. Department of Education. Both Trump and his new Secretary of Education Linda McMahon publicly suggested last week that the Department will be abolished.

Although the for-profit college industry endlessly complained that the Biden and Obama education departments were unfairly targeting the industry with regulations and enforcement actions, they now seem concerned about the possibility that the Trump administration will shutter the Department entirely, abandon the federal role in higher education oversight, and leave regulation to the states. They likely are even more frightened that the proposed gutting of the Department will interfere with the flow of billions in federal taxpayer dollars to their schools.

The Chronicle of Higher Education reports that Jason Altmire, the former congressman who is now the CEO of the largest lobbying group of for-profit colleges, Career Education Colleges and Universities (CECU), says that his schools are worried about the potential disruption of funding for federal student grants and loans. Altmire apparently also expressed concern that turning regulation over to the states could create problems for online schools that operate in multiple states, especially because some states have relatively strong accountability rules.

Many for-profit colleges receive most of their revenue — as much as the 90 percent maximum allowed by U.S. law — from federal taxpayer-supported student grants and loans. For-profit schools have received literally hundreds of billions in these taxpayer dollars over the past two decades, as much as $32 billion at the industry’s peak around 2010, and around $20 billion annually n0w.

But many for-profit schools have used deceptive advertising and recruiting to sell high-priced low quality college and career training programs that leave many students worse off than when they started, deep in debt and without the career advancement they sought. Dozens of for-profit schools have faced federal and state law enforcement actions over their abuses.

CECU (previously called APSCU and before that CCA) has included in its membership over the years many of the most abusive, deceptive school operations, including Corinthian Colleges, ITT Tech, Education Management Corp., Perdoceo, Center for Excellence in Higher Education, DeVry, Kaplan (now called Purdue University Global), and Ashford University (now called University of Arizona Global Campus). (Republic Report highlighted the bad actors on CECU’s membership list for many years; CECU removed the list from its website about four years ago.)

Florida couple Arthur and Belinda Keiser are among those who have benefited the most from CECU lobbying and taxpayer funding. The Keisers run for-profit Southeastern College and non-profit Keiser University, which collectively have received hundreds of million in federal education dollars over the years. They also are among the most politically active owners in the career college industry.

While Belinda Keiser has run, unsuccessfully, for the state legislature, Arthur Keiser has been one of the most aggressive lobbyists for the career college industry in Washington. He has been a dominant figure on the board of CECU, and he hired expensive lawyers to go all the way to the U.S. Supreme Court in a failed effort to block a settlement that provides debt relief to students who attended deceptive colleges, including Keiser University. During Trump’s first term, Arthur Keiser chaired NACIQI, the Department of Education’s advisory committee reviewing the performance of college accreditors.

The Keisers created controversy and were eventually penalized by the IRS for a shady 2011 conversion of Keiser University from for-profit to non-profit, in a deal that allowed the couple to continue making big money off the school. Keiser University has also settled cases with the Justice Department and the Florida attorney general over deceptive practices.

In the two years leading up to the November 2024 election, according to Federal Election Committee records, Belinda Keiser donated more than $250,000 to various Republican candidates and political committees, including $35,000 to the Trump 47 Committee, $10,300 to the Trump-affiliated Save America PAC, $3300 to the Trump Save America Joint Fundraising Committee, and $33,400 to the Republican National Committee.

Ultra-wealthy college owner Carl Barney was another big Trump 2024 donor. Barney operated the Center for Excellence in Higher Education, another troubling conversion from for-profit to non-profit that kept taxpayer money flowing into his bank accounts, for schools including CollegeAmerica and Independence University. Barney’s schools lost their accreditation, and then their federal aid, after the Colorado attorney general in 2020 won a lawsuit accusing CollegeAmerica of deceptive practices. (The case is still pending after an appeal.)

Amid a torrent of donations to Republican committees last fall totaling over $1.6 million, Barney donated $924,600 to the Trump 47 Committee, $74,500 to the Trump-supporting Make America Great Again PAC, and $247,800 to the Republican National Committee, according to federal records.

In a September post on his personal website, Barney explained that he liked that Trump “wants to work with Elon Musk to reduce spending, regulations, waste, and fraud in the federal government.”

What exactly waste, fraud, and abuse seems to mean in the context of the Trump/Musk effort is troubling. There is little evidence that what DOGE has found and shut down relates to actual fraud, abuse, or corruption.

Instead it appears that much of what Musk and DOGE have focused on is weakening or eliminating either (1) federal agencies that have been investigating Musk businesses, or businesses of other top Trump donors; or (2) agencies that work on priorities — such as equal opportunity for Americans or alleviation of poverty or disease overseas — that Trump or Musk dislike.

And the Trump team has been firing, across multiple federal agencies, the inspectors general, ethics watchdogs, and other top officials actually charged with rooting out waste, fraud, and abuse — further undermining the claim that the Trump team is trying to bring about more honest and efficient government.

It’s doubtful that even the heaviest sledgehammer DOGE attack would eliminate the federal student grants and loans that Congress has mandated to give low and moderate income Americans of all backgrounds a better chance to improve their lives through higher education. Assuming such financial aid will continue, then if Trump, Musk, and DOGE truly wanted to root out waste, fraud, and abuse, and save big money for taxpayers, one thing they could do is strengthen, rather than abolish, the Department of Education — not to keep the money flowing to all for-profit colleges, as CECU seems to want, but to advance efforts to ensure that taxpayer dollars go only to those colleges that are creating real benefits for students and for our economy.

That would mean enforcing and building on, not destroying, the Department of Education rules put in place by the Biden administration, including: the gainful employment rule, which creates performance standards to cut off aid to for-profit and career programs that consistently leave graduates with insurmountable debt; the borrower defense rule, which cancels the debts of students scammed by their schools and empowers the Department to go after those predatory schools to recoup the taxpayer money; and the 90-10 rule, which helps keep low-quality programs out of the federal aid program and reduces the risk that poor quality schools will target U.S. veterans and service members.

It would also mean continuing the Biden administration’s efforts to more aggressively evaluate the performance of the private college accrediting agencies that oversee colleges and serve as gatekeepers for federal student grants and loans.

Fighting waste, fraud, and abuse would also mean strengthening, not gutting, efforts to investigate and fight predatory college abuses by enforcement teams at the Department of Education, Federal Trade Commission, Consumer Financial Protection Bureau, Justice Department, Department of Veterans Affairs, and Department of Defense. Many deceptive school operations remain in business today, recruiting veterans, single parents, and others into low-quality, over-priced college programs; they include Perdoceo’s American Intercontinental and Colorado Technical University, Purdue University Global, University of Arizona Global Campus, DeVry University, Walden University, the University of Phoenix, South University, Ultimate Medical Academy, and UEI College.

Fighting waste, fraud, and abuse also would likely require a different higher ed leader at the Department than Nicholas Kent, the Virginia state official whom Trump has nominated to serve as Under Secretary of Education. Kent previously worked at CECU as a lobbyist advancing the interests of for-profit schools. Prior to that, he worked at Education Affiliates, a for-profit college operation that faced civil and criminal investigation and actions by the Justice Department for deceptive practices.

Diane Auer Jones, who held the same job in the first Trump administration, had a career background similar to Kent’s, and she twisted Department policies and actions to benefit predatory colleges. That is presumably the world CECU and its for-profit college barons want to restore: All the money, none of the accountability rules.

In the end, the predatory college owners may get what they want. Given the brazen self-dealing, and fealty to corporate donors, of the Trump-Musk administration, and the sharp elbows of paid-for congressional backers of the for-profit college industry like Rep. Virginia Foxx (R-NC), we will probably end up with the worst of all outcomes: the destruction of the Department of Education but a continued flow of taxpayer billions to for-profit schools, without meaningful accountability measures to ensure that everyday Americans are actually protected from waste, fraud, and abuse.

Americans should demand from Trump and Secretary McMahon a different course — one that provides educational opportunity for all and strengthens the U.S. economy by investing in higher education, while removing from the federal aid program the abusive colleges that rip off students and scam taxpayers.

[Editor's note: This article originally appeared on Republic Report.]  

Bibliography of the College Meltdown

Dahn Shaulis

CollegeMeltdown@protonmail.com

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When college choice is a fraud

Students are targeted and lied to by subprime colleges and they are often treated with indifference by public education.

In 2014, USC graduate student Constance Iloh and her advisor Dr. William Tierney examined the "rational choices" behind college choice. Their subjects were more than 130 students who had chosen either a community college or for-profit college for a vocational nursing or surgical technician associate’s degree.

Rational choice, a common theory in mainstream economics, refers to the theory that individuals make decisions to maximize their benefits and minimize their costs. By talking to focus groups, the researchers hoped to find out why students chose a $30,000 for-profit education lasting 13 months or a $5,000 public program taking two years to finish. Both schools had graduation rates of about 30%.

In the Iloh and Tierney study, students who chose for-profit colleges said that community colleges presented too many barriers and that their schools offered more convenience and accessibility in scheduling and location. With accelerated schedules, for-profit students thought they could graduate earlier than if they attended a community college--which was important as they weighed important family obligations.

Some for-profit college students also believed their education was superior to a community college because it offered more "hands on" opportunities. The researchers did not dig deeper though, to investigate how the students came up with their ideas.

Although most of the students were probably women, and many were working-class people and people of color, the researchers did not discuss important race, class, and gender issues. The researchers also ignored examining cross-culturally: what other nations have done to make higher education more effective, socially just, and democratic, or even how various states in the United States have made college free or low cost to its citizens.

"Rational choice" in US education, however, must be examined in a society affected by deindustrialization and deskilling of work, government austerity and the defunding of public education, neoliberalism, structural racism, increasing economic inequality and reduced intergenerational social mobility, social myths perpetuated by predatory marketing, and ultimately--difficult choices caused by "the injuries of class."

The truth is, millions of hard working low-wage workers (including single mothers, disabled military veterans, struggling immigrants, people with learning challenges or those who have had fewer educational opportunities) may be looking for the most obvious way to achieve the American Dream, whether it's from a message in their email inbox or a friendly voice at the other end of the telephone.

But that's the essence of the for-profit con--something that Iloh and Tierney downplay.  There are subprime schools regularly trolling for the most vulnerable people.

The researchers also fail to recognize that some for-profit students continue along the more financially expensive route, even after realizing they've made a bad choice, believing they have sunk too much into their investment to quit--and knowing that their credits won't transfer.

Theories of Sunken Investment, Time Discounting, and Asymmetric Information may be useful in understanding the difficult personal choices that working class people face--but theories of justice must also be utilized.

Sadly, this study really shows the dysfunctional nature of US education in general. Whether a working class student chooses a for-profit college, community college, or public or private university, he or she is taking on significant risks of either not graduating, taking on enormous debt, subjecting family members to debt obligations, or being taken away from important family interests.

Dr. Tierney is not an objective researcher (no researcher is). He is a tenured professor at an elite university who believes for-profit colleges have a role in American neoliberal society. And he has colleagues who have profited from this line of thinking. Tierney believes for-profit schools have problems, but that they can be reformed. With the poor state of many subprime for-profit colleges and community colleges, it's difficult to imagine how educational reform is possible.

To make better informed choices, working-class people surely need to learn about the myths of college and the sales pitches that are used to hook unsuspecting prospects. But even that is not enough. Without social justice, fairness, and access in society, people will be compelled to pray and make the best of unjust and limited "rational" choices.

"If we expect to increase the rate of degree completion, we must invest in early childhood education and enhance the quality of precollegiate education, especially for students who are African American, Hispanic, and low income" --Diane Ravitch

An earlier version of this article is available at https://www.linkedin.com/pulse/college-choice-rational-dahn-shaulis?trk=mp-author-card

Civil Rights Groups Sue Facebook and Instagram For Targeting Predatory College Ads at Black Users (David Halperin)

A nonprofit advocacy group sued Meta this week, contending that the tech giant’s Facebook and Instagram platforms facilitate the targeting of ads for for-profit colleges to Black users, while disproportionately steering ads for public and non-profit colleges to white users. 

The lawsuit, filed in the District of Columbia Superior Court on behalf of the non-profit Equal Rights Center (ERC), alleges that Meta thus “provides separate and unequal services to Black users in its places of public accommodations.”

In a statement, ERC’s lead lawyers, from the non-profit Lawyers’ Committee for Civil Rights Under Law, call Meta’s practices “modern-day digital redlining.” 

Redlining refers to unlawful practices that deny or restrict financial and other services — such as consumer loans and home mortgages — to people based on their race, ethnicity, or other protected characteristic. 

ERC’s lawyers allege that Meta’s conduct violates the District of Columbia’s Human Rights Act and Consumer Protection Procedures Act.

As the lawyers note, many for-profit colleges have histories of using deceptive advertising and recruiting to draw people into high-priced, low-quality programs that leave many students worse off than when they enroll — deep in debt and without the careers they sought. As a result, ERC’s complaint argues, Black users are disadvantaged by Meta’s alleged practice of pushing them to for-profit schools and denying them communications from higher quality, more affordable schools.

For-profit schools with records of poor student outcomes have frequently been accused of targeting their marketing and recruiting at Black people.

The new complaint accuses Meta of promising to deliver users a “valuable and relevant personalized” ad experience when it has instead “[made] ad delivery decisions based on race.” 

The complaint alleges that Meta collates data that Facebook and Instagram directly collect from users with data from various apps and websites, including, on at least one occasion, reported ethnicity information from the ACT college entrance exam website, and employs the collective data to target individual users.

The complaint references a July 2024  academic paper, describing how researchers submitted to Facebook pairs of ads, one for a for-profit college and the other for a nonprofit school. They found, according the complaint, that Black Facebook and Instagram users “were more likely to get ads for the for-profit colleges, while white Facebook and Instagram users were more likely to get the ads for the public nonprofit schools.” The complaint does not identify the academic study, but the description suggests the lawyers are referencing a report from researchers at Princeton and the University of South California. 

A 2016 report by Pro Publica revealed that Facebook was permitting advertisers on its site to exclude users from their ad campaigns based on race. Facebook ultimately removed that option for advertisers, but further research suggests that Meta’s algorithms still effectively skew ads based on the race of the user.  

Damon T. Hewitt, president and executive director of the Lawyers’ Committee, the legal group that filed the case, said in a statement, “Separate and unequal services should be remnants of the past, but they are still a present-day reality for Black users on Meta’s platforms.” He added, “Digital redlining, especially in today’s higher education market, sends the unmistakable signal that Black people belong in some institutions but not others. This lawsuit aims to make it clear that no corporation—not even a Big Tech company as powerful as Meta—should be allowed to profit from the discriminatory treatment of Black students and consumers.”

Meta has not responded to our request for comment on the lawsuit.

ERC is also represented in the case by the Washington Lawyers’ Committee for Civil Rights and Urban Affairs, and the law firm Emery Celli Brinckerhoff Abady Ward & Maazel LLP.

[Editor's note: This article originally appeared on Republic Report.] 

IPEDS Trend Generator illustrates lower enrollment, less revenues, fewer jobs at for-profit colleges

The newest US Department of Education IPEDS data show that enrollment, revenues, and jobs have decreased dramatically in the for-profit college sector. 

Enrollment at for-profit colleges dropped from a peak of 2.4 million in Fall 2010 to 1.3 million in Fall 2017.  That's an enrollment drop of 1.1 million.  

This, in turn, has led to less revenue and fewer workers. 

Revenues at for-profit colleges peaked in 2011 at $29.6B and dropped to $19.4B in Fall 2017. That's a drop of more than $10B a year from its peak. 

For-profit college employees peaked at 295,887 in 2012 and the number dropped to 176,441 by Fall 2017. That's a loss of more than 120,000 jobs.

Decline in enrollment, revenues, and employees (2010-present)

Fall/Year    Enrollment    Revenues              Employees
2010           2,430,657      29,603,059,000     295,476
2011           2,368,440      33,889,758,000     288,882
2012           2,174,457      32,196111,000      295,887
2013           2,000,883      29,643,714,000     258,098
2014           1,883,199      27,310,167,000     241,134
2015           1,629,393      24,007,022,000     214,656
2016           1,437,452      20,804,128,000     191,083

2017           1,345,633      19,446,382,000     176,441 

You can create graphs and tables yourself using the updated data at the IPEDS Trend Generator.

Current conditions in the for-profit college industry may actually be worse, judging by the Fall 2018 assessment by National Student Clearinghouse, which had reported an additional 15 percent decline.  However, NSC's original press release has been removed.  

The data also do not consider more recent losses, such as the collapse of Education Corporation of America (which includes Brightwood College and Virginia College) or Dream Center Education Holdings (which includes Argosy, Art Institutes, and South University. 

One confounding issue is that for-profit colleges Grand Canyon University and Purdue University Global (formerly Kaplan) have moved to the non-profit side.  Ashford University is also working on having its tax status changed from for-profit to non-profit.

Related link: Observations of the College Meltdown in Real Time

Related link: The Slow-Motion Collapse of America’s Largest University

Robocollege Update

 

Robocolleges are a mix of for-profit and non-profit online colleges, both secular and Christian.  Their focus is on automation and reduced costs, particularly labor costs:

Instruction is delivered through automated Learning Management Systems (LMS) and online platforms, relying less on professors and more on pre-recorded lectures and automated grading. Even support staff are being replaced by chatbots.  

While some qualified individuals might be involved, educational content is often developed by large teams with varying expertise, potentially sacrificing quality for cost-effectiveness.

Marketing and advertising continue to be costly. But targeting marketing (e.g. targeting military service members and veterans, teachers, nurses, and government workers in low-income neighborhoods) can improve cost efficiency. 

Robocolleges offer degrees with a wide range of value to consumers (return on investment versus debt).  For people who need a degree (or an advanced degree) to play the game in government and medicine, these credentials may have value. 

Competency-based education and credits for life experience reduce the number of courses some students need to graduate.  Servicemembers going to Purdue Global, for example, can get an AA with as few as five college courses and a BS with as little as seven additional courses.

Cheating is probably easier for online students who are so inclined and whether these companies care is not really known.  

Southern New Hampshire (SNHU) continues to be the growth and efficiency leader, with the highest enrollment, more than 160,000 students. SNHU is also experimenting with artificial intelligence to reduce labor costs. In addition, SNHU works with Guild (aka Guild Education), which recruits workers from Walmart, Target, Waste Management, and other large employers.  

Grand Canyon (for-profit) and Liberty University (non-profit) target Christians for online credentials.  But oppressive debt is a concern with some of their programs. Social mobility for students is subpar.  

Purdue University Global and University of Arizona, Global Campus are two former for-profit colleges now owned by state universities. Information about their financial status is sketchy. Like SNHU, Purdue Global works with Guild to recruit working folks.  Purdue Global owes its online program manager. Kaplan Education, about $128 million.  Arizona Global has had financial difficulties which have affected the University of Arizona's bottom line.  

The University of Phoenix has returned to profitability by reducing instruction and student services by $100 million a year and legal costs by $50 million a year.  Consumers continue to file fraud complaints by the tens of thousands.  And debt is an enormous problem with former students.  It's not apparent whether Phoenix can maintain such enormous profits, but its future as a non-profit affiliated with the University of Idaho may reduce its tax burden and legal liabilities. 

Here are the most recent numbers from the US Department of Education College Navigator:

American Intercontinental University: 89 full-time instructors for 14,333 students.
American Public University System has 332 F/T instructors for 48,688 students.
Aspen University has 27 F/T instructors for 7,386 students.
Capella University: 180 F/T for 39,727 students.
Colorado State University Global: 40 F/T instructors for 9,565 students.
Colorado Technical University: 55 F/T instructors for 24,808 students.
Devry University online: 61 F/T instructors for 26,384 students.
Grand Canyon University has 550 F/T instructors for 101,816 students.*
Liberty University: 735 F/T for 96,709 students.*
Purdue University Global: 337 F/T instructors for 45,125 students.
South University: 41 F/T instructors for 7,707 students.
Southern New Hampshire University: 130 F/T for 164,091 students.
University of Arizona Global Campus: 122 F/T instructors for 34,190 students.
University of Maryland Global: 177 F/T instructors for 55,838 students.
University of Phoenix: 80 F/T instructors for 88,891 students.
Walden University: 235 F/T for 42,312 students.

*Most F/T faculty serve the ground campuses that profit from the online schools. 

 

Related links:

Robocolleges, Artificial Intelligence, and the Dehumanization of Higher Education (2023)

AI-ROBOT CAPITALISTS WILL DESTROY THE HUMAN ECONOMY (Randall Collins, 2023)

Guild Education: Enablers of Anti-Union Corporations and Subprime College Programs (2021)

The Growth of "RoboColleges" and "Robostudents" (2019)

The Higher Education Assembly Line (2019)

 

 

 

 

The Future of Federal Student Loans

The U.S. student loan system, now exceeding $1.7 trillion in debt and affecting over 40 million borrowers, is facing significant challenges. As political pressures rise, the management of student loans could be significantly altered. A combination of potential privatization, the elimination of the U.S. Department of Education (ED), and a new role for the Department of the Treasury raises critical questions about the future of the system.

U.S. Department of Education: Strained Resources and Outsourcing

The U.S. Department of Education (ED) is responsible for managing federal student loan servicing, loan forgiveness programs, and borrower defense to repayment (BDR) claims. However, ED has faced ongoing issues with understaffing and inefficiency, particularly as many functions have been outsourced to contractors. Companies like Maximus (including subsidiaries like AidVantage) manage much of the administrative burden for loan servicing. This has raised concerns about accountability and the impact on borrowers, especially those seeking loan relief.

In recent years, ED has also experienced staff reductions and funding cuts, making it difficult to process claims or maintain high-quality service. The potential for further cuts or even the elimination of the department could exacerbate these problems. If ED’s role is diminished, other entities, such as the Department of the Treasury, could assume responsibility for managing the student loan portfolio, though this would present its own set of challenges.

Potential for Privatization of the Student Loan Portfolio

One of the most discussed options for addressing the student loan crisis is the privatization of the federal student loan portfolio. Under previous administration discussions, including those during President Trump’s tenure, there were talks about selling off parts of the student loan portfolio to private companies. This would be done with the aim of reducing the federal deficit.

In 2019, McKinsey & Company was hired by the Trump administration to analyze the value of the student loan portfolio, considering factors such as default rates and economic conditions. While the report's findings were never made public, the idea of transferring the loans to private companies—such as banks or investment firms—remains a possibility.

The consequences of privatizing federal student loans could be significant. Private companies would likely focus on profitability, which could result in stricter repayment terms or less flexibility for borrowers seeking loan forgiveness or other relief options. This shift may reduce borrower protections, making it harder for students to challenge repayment terms or pursue loan discharges.

The Department of the Treasury and its Potential Role

If the U.S. Department of Education is restructured or eliminated, there is a possibility that the Department of the Treasury could step in to manage some aspects of the student loan portfolio. The Treasury is responsible for the country’s financial systems and debt management, so it could, in theory, handle the federal student loan portfolio from a financial oversight perspective.

However, while the Treasury has experience in financial management, it lacks the specialized knowledge of student loans and borrower protections that the Department of Education currently provides. For example, the Treasury would need to find ways to process complex Borrower Defense to Repayment claims, a responsibility ED currently manages. In 2023, over 750,000 Borrower Defense claims were pending, with thousands of claims related to predatory practices at for-profit colleges such as University of Phoenix, ITT Tech, and Kaplan University (now known as Purdue Global). Additionally, some of these for-profit schools were able to reorganize and continue operating under different names, further complicating the situation.

The Treasury could also contract out loan servicing, but this could increase reliance on profit-driven companies, possibly compromising the interests of borrowers in favor of financial performance.

Borrower Defense Claims and the Impact of For-Profit Schools

A large portion of the Borrower Defense to Repayment claims comes from students who attended for-profit colleges with a history of deceptive practices. These institutions, often referred to as subprime colleges, misled students about job prospects, program outcomes, and accreditation, leaving many with significant student debt but poor employment outcomes.

Data from 2023 revealed that over 750,000 Borrower Defense claims were filed with the Department of Education, many of them against for-profit institutions. The Sweet v. Cardona case showed that more than 200,000 borrowers were expected to receive debt relief after years of waiting. However, the process was slow, with an estimated 16,000 new claims being filed each month, and only 35 ED workers handling these claims. These delays, combined with the uncertainty around the future of ED, leave borrowers vulnerable to prolonged financial hardship. 

Lack of Transparency and Accountability in the System

While the U.S. Department of Education tracks Borrower Defense claims, it does not publish institutional-level data, making it difficult to identify which schools are responsible for the most fraudulent activity. 

In response to this, FOIA requests have been filed by organizations like the National Student Legal Defense Network and the Higher Education Inquirer to obtain detailed information about which institutions are disproportionately affecting borrowers. 

In one such request, the Higher Education Inquirer asked for information regarding claims filed against the University of Phoenix, a school with a significant number of Borrower Defense claims.

The lack of transparency in the system makes it harder for borrowers to make informed decisions about which institutions to attend and limits accountability for schools that have harmed students. If the Treasury or private companies take over management of the loan portfolio, these transparency issues could worsen, as private entities are less likely to prioritize public accountability.

Conclusion

The future of the U.S. student loan system is uncertain, particularly as the Department of Education faces the potential of funding cuts, staff reductions, or even complete dissolution. If ED’s role diminishes or disappears, the Department of the Treasury could take over some functions, but this would raise questions about the fairness and transparency of the system.

The possibility of privatizing the student loan portfolio also looms large, which could shift the focus away from borrower protections and toward financial gain for private companies. For-profit schools, many of which have a history of predatory practices, are responsible for a disproportionate number of Borrower Defense claims, and any move to privatize the loan portfolio could exacerbate the challenges faced by borrowers seeking relief from these institutions.

Ultimately, there is a need for greater transparency and accountability in how the student loan system operates. Whether managed by the Department of Education, the Treasury, or private companies, protecting borrowers and ensuring fairness should remain central to any future reforms. If these issues are not addressed, millions of borrowers will continue to face significant financial hardship.

Owners of Shuttered For-Profit Hussian College Sue ex-CEO, Charging Embezzlement (David Halperin)

The owners of shuttered for-profit Hussian College have sued the school’s former president and CEO, Jeremiah Staropoli, seeking $162 million in damages and penalties and claiming that Staropoli and close associates in the company embezzled funds and then conspired to cover up the alleged misdeeds.

On September 5, father-and-son Hussian owners David and Joshua Figuli sued Staropoli, other former Hussian employees, and two lending companies in Pennsylvania state court, alleging a racketeering conspiracy, fraud, embezzlement, and other abuses. The lending companies, contending there was a basis for federal court jurisdiction, removed the case from the state court to the U.S. District Court in Philadelphia.

While the companies and some of the former employees have filed answers to the complaint or moved to dismiss the case, Staropoli has not responded. In a recent court filing, the Figulis say they have tried to serve Staropoli with the complaint seven times and that Staropoli “appears to be evading service.”

Staropoli did not respond to a request for comment from Republic Report. The Figuli’s attorney also did not respond.

The Hussian closure

Hussian College, founded in Philadelphia in 1946, closed in summer 2023. At the time it shut down, Hussian had hundreds of students at campuses in Pennsylvania, Ohio, Tennessee, and California, plus online offerings, and taught programs in business, information technology, criminal justice, health sciences, and the arts. Hussian, in 2018, had expanded by taking over Tennessee-based for-profit Daymar College, a school that had in 2015 agreed to a $12.4 million settlement to end a lawsuit, alleging deceptive practices, brought by Kentucky’s attorney general.

For academic year 2021-22, the last year for which the U.S. Department of Education published data on the school, Hussian received $14.8 million in federal student aid dollars from the Department — about 74 percent of the school’s revenue.

In June 2022, accrediting agency ACCSC, the gatekeeper for the schools’ eligibility for federal student grants and loans, had put all the Hussian and Daymar campuses on system-wide warning, citing concerns about student achievement at the schools. But ACCSC removed the warning and renewed Hussian’s accreditation in December 2022.

The Figulis announced the closure in June 2023, two weeks after Joshua Figuli informed Hussian students by email that the school’s board of directors had replaced Staropoli because it had “lost confidence in his leadership.” Figuli wrote in a separate email to faculty and staff that a “gut-wrenching process of discovery” had produced “shockingly revealing” information about the state of the school under Staropoli.

Around the time of the announced closure, more than 15 Hussian faculty, staff, students, and parents spoke with Republic Report. They told me that Hussian repeatedly had been pressed by vendors for extended and blatant failures to pay its bills, that students had not been receiving federal aid disbursements in a timely manner, that Hussian owed money to many students, and that Hussian was enrolling new students even as it was about to close.

One Hussian employee at the time reported to me evidence of financial misconduct, improper expenses, and computer access manipulation by Staropoli. The employee also said that Joshua Figuli, who stepped in as CEO when Staropoli was dismissed, was failing to respond to calls and emails from students and staff who were trying to find out what was going on.



The lawsuit’s allegations

The lawsuit filed in September by the Figulis places the blame for Hussian’s collapse squarely on Staropoli, who joined Hussian as CEO in 2017, and a group of employees he brought in. The Figulis admit to knowing that Staropoli had past ties to some of these employees, but they claim the ties turned out to be much deeper than Staropoli told them, including, they allege, one employee engaged, before and after being hired, in an apparent romantic relationship with Staropoli. The Figulis allege that Staropoli caused Hussian to pay large and unwarranted bonuses to these favored employees, and even allowed one of them to work for Hussian while remaining on the payroll of a competitor school.

The Figulis also allege that Staropoli conspired with the two lending companies to make deals behind their backs and that Staropoli created fake email addresses for the Figulis so that he, not they, would receive confirmation of the deals.

The Figulis say that under Staropoli’s leadership, Hussian was failing to return to the government millions in unearned federal and state student aid, as required by law, and that Staropoli was concealing from them the schools’ “dire state of cash flow” and its failure, also, to transmit hundreds of thousands owed to students.

And they allege that school money was used to pay for Staropoli’s family and friends to vacation in Orlando and Nashville; for charges from Staropoli’s country club in Delaware; for tuition payments to Drexel University for one of the favored employees, despite that same employee ending Hussian’s tuition reimbursement policy; for “nondescript transfers to VENMO”; and more.

The Figulis claim that the alleged improper actions of Staropoli and other defendants induced them “to provide loans, advance costs, provide capital infusions, forego collections, and execute guarantees that summed to total direct losses in excess of $6,948,110.93.”

The two lending companies have moved to dismiss the case, one former employee has done the same, and another former employee filed an answer to the complaint. But former employee Steven Wojslaw, according to a filing by the Figulis, was served but has not filed any response.

Wojslaw filed his own lawsuit against Hussian in 2022, after he apparently put his own money into the company. When he was terminated, he sued to get the money back. That case was settled. Meanwhile, Velocity Capital Group, one of the lenders the Figulis have now sued, filed last year its own lawsuit in New York against Hussian and the Figulis, seeking its investment back. The Figulis have filed a counterclaim in that lawsuit.

In their new case against Starapoli, Velocity, and the others, the Figulis filed a motion on December 2 seeking permission to amend their original complaint to clarify, add, and withdraw certain claims, in part to respond to the motions to dismiss.

Who is Jeremiah Staropoli?

A former employee says information that the company learned around the time the Figulis forced out Staropoli came as “a giant shock” to the company. “It was insane,” this ex-employee says. “There were multiple victims: the Figulis, but also the staff, the students, and the government.” The ex-employee asks, “Why don’t people go to prison” when they “destroy so many lives?” This employee says that, as the school struggled, many employees believed the Figulis were the enemy, who wouldn’t invest enough money and time “to help Staropoli save the company,” but that the facts in the new lawsuit tell a different story.

Jeremiah Staropoli is a former president of the Towson, Maryland, campus of Brightwood College, a for-profit chain owned by now-collapsed Education Corporation of America. He also previously worked for the for-profit college operations Kaplan and DeVry. According to his LinkedIn page, he also was previously president of the Kentucky-based The Keeling Group, an IT consulting firm “specializing in custom software development, cloud consulting, network integration and higher education regulatory compliance solutions.”

Staropoli also was once listed as part of the management team of a fledgling coding bootcamp operation owned by the Figulis called AcademicIQ, but that business apparently never took off. Hussian College and AcademicIQ shared an address on Spring Garden Street in Philadelphia, along with a campus of non-profit Harrisburg University. David Figuli until recently served on the Harrisburg University board of trustees.

Hussian also has a connection to Colbeck Capital Management, slippery operators of campuses of the Art Institutes (now closed) and South University (still open) that were acquired in the wake of the collapse of Dream Center Education Holdings. Hussian acquired the Los Angeles-based Studio School, in which Colbeck had been an investor, and renamed the school Hussian College Los Angeles; Staropoli told me in 2019 that Colbeck-backed Studio Enterprise remained “a service provider” to the school.

The mess at Hussian seems to be just the latest example of how the federal investment in for-profit colleges often ends up as waste, fraud, and abuse — with taxpayers ripped off, students locked out in the cold, and some for-profit executives walking away with cash and fancy perqs. The for-profit college industry, recalling the lax enforcement in the first Trump term under Secretary of Education Betsy Devos, is salivating at the impending restoration of the leader of scam Trump University as leader of the United States. But, if it has any integrity at all, the new department that Elon Musk is supposedly setting up for Trump — committed to rooting out federal government waste, fraud, and abuse — should investigate this industry promptly.

[Editor's note: This article originally appeared on Republic Report.]