Higher Education Inquirer : Search results for maximus

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Sunday, January 23, 2022

Maximus, Student Loan Debt, and the Poverty Industrial Complex

The Higher Education Inquirer is taking a close look at who's invested in Maximus, the enormous social welfare profiteer. Maximus has been servicing student loan defaulters for years and has now taken over Navient's federal student loan business, branding it Aidvantage.

Since 1995, Maximus (MMS) has grown from $50 million in annual revenues to more than $4 billion in 2021.

Maximus (MMS) Share Price 1995-2022

(Source: Seeking Alpha)

With an army of more than 35,000 workers, Maximus' clients include 28 US agencies: the Internal Revenue Service, Department of Commerce, National Oceanic and Atmospheric Administration, Bureau of the Census, Patent and Trademark Office, Federal Student Aid, Department of Defense and US Army, Department of Veterans Affairs, Homeland Security, Health and Human Services, Medicare and Medicaid, Department of Labor, Office of Personnel Management, Securities and Exchange Commission and many more.

As a contractor to Federal Student Aid (FSA), Maximus has more than 13 million student loans to service. Its four contracts with the US Department of Education total almost $1 Billion.

While CEO Bruce Caswell made more than $6 million in total compensation last year, Maximus' customer service representatives, the people who have to make the calls to the growing number of student loan defaulters, make less money than workers at Walmart.

Maximus has recently posted federally contracted jobs on Indeed for $13.15 an hour in Texas and South Carolina, even though the federal minimum wage has been raised to $15 an hour. Wages for Maximus workers in other states are reportedly even lower, as little as $10 an hour in Kentucky and other states with regressive economies.

Maximus' largest institutional investors include BlackRock, Vanguard Group, and State Street Corp--three financial behemoths. BlackRock has $10 trillion in Assets Under Management (AUM), Vanguard Group has about $7 Trillion in Assets Under Management, and State Street has almost $4 Trillion in AUM.

Bank of New York Mellon, Wells Fargo, and Bank of America each own 900,000 shares or more.

Public retirement funds, including public school teachers retirement funds (see table below), are directly and indirectly invested in the Poverty Industrial Complex and the student loan mess through Maximus and other large corporations.

Maximus and its executives have spent more than $10 million on federal lobbying and political contributions since 1998. By 2020, Maximus had 14 lobbyists in DC and had contributed to the campaigns of Joe Biden, Bernie Sanders, and Donald Trump.

Maximus' strategic partners include AWS, Microsoft, Oracle, and Cisco.

Social justice advocates have to wonder, how can the student loan system be fixed if the US establishment has a vested interested in the mess?

Maximus (MMS) Top Institutional Investors

List of Public Funds Directly Invested in Maximus

Alaska Department of Revenue
California PERS
California State Teachers Retirement System
Colorado PERS
Florida Retirement System
Pennsylvania Public School Retirement System
Teachers Retirement System of Kentucky
Louisiana State Employees Retirement System
Ohio PERS
New Mexico Educational Retirement Board
New York State Retirement System
New York State Teachers Retirement System
Ontario Teachers Retirement System
Oregon PERS
State of Tennessee Treasury
Teachers Retirement System of Texas
State of Wisconsin Investment Board

Related link: Maximus Institutional Investors

Thursday, December 12, 2024

Maximus AidVantage Contracts with the US Department of Education Publicly Available

The Higher Education Inquirer has received all the current contracts between the US Department of Education and Maximus/AidVantage through a Freedom of Information Act (FOIA) request. Maximus serves millions of student loan debtors and has faced increased scrutiny (and loss of revenues) for not fulfilling their duties on time.

The FOIA response (23-01436-F) consists of a zip file of 998 pages in 5 separate files. HEI is sharing this information with any news outlet or organization for free, however we would appreciate an acknowledgement of the source.

We have already reached out to a number of organizations, including the Student Borrower Protection Center, the Debt Collective, the Project on Predatory Lending, the NY Times, ProPublica, and Democracy Now! We have also posted this article at the r/BorrowerDefense subreddit.

Wednesday, April 13, 2022

College Meltdown 2.1

The Higher Education Inquirer has added three companies to its College Meltdown watchlist: Ambow Education (AMBO), SoFi (SOFI), and Adtalem (ATGE).

Leading the way is National American University Holdings (NAUH), which is down to less than $50,000 in cash. Ambow Education (AMBO) and Aspen Group (ASPU) are near penny stock territory and Barnes and Noble Education (BNED) and SoFi (SOFI) are also in deep financial trouble.

Declining share price is not the only factor to make the College Meltdown list. Government contractor Maximus (MMS), for example, is on the list for its predatory behavior with student debtors and its own workers, as well as its questionable contracts with the US Department of Education.

Adtalem makes the list for continuing to put lots of working-class folks (particularly women and people of color) into a lifetime of student loan debt.

2U is identified for its fleecing of its clients (universities), end customers (students) and shareholders. In its last annual report, the company told shareholders that the number one risk was that it may never make a profit.

2U (TWOU) Shares have dropped 70 percent over the last year (Source: Seeking Alpha)

Shares of student loan refinance company SoFi (SOFI) are down 70 percent over the last year

(Source: Seeking Alpha)

Barnes and Noble Education (BNED) shares have dropped 66 percent over the last 6 months.

(Source: Seeking Alpha)

Aspen Group (ASPU) shares have declined 82 percent over the last year.

(Source: Seeking Alpha)

Monday, May 9, 2022

College Meltdown 2.2: Who’s Minding the Store?

The latest report by the Government Accountability Office (GAO) about wrongdoing by higher education online program managers (OPMs) felt disappointing to social justice advocates who watch the space and know the bad actors who were unnamed in the GAO document.

US higher education has always been a racket, but its latest pursuits have gone untouched and even unmentioned. GAO’s behavior, though, is no worse than the many other corporate enablers who are supposed to be minding government funds wasted –or worse yet—used to prey upon US working families.

The US Department of Education has done little lately to safeguard consumers from predatory student loan servicers like Maximus and Navient, or subprime universities like Purdue University Global and University of Arizona Global, and hundreds of small players who offer marginal education leading to less than gainful employment.

The Department of Veterans Affairs has done little lately to protect veterans and their families from being ripped off by subprime schools. At one time, VA was a leader in tracking GI Bill complaints and making them public, but transparency and accountability are far from what they were.

The US Department of Defense (DOD) has been asleep at the wheel with its distribution of DOD Tuition Assistance funds to subprime colleges. Its complaint system is close to nonexistent.

The US Department of Justice (DOJ) and US Securities and Exchange Commission (SEC) have done little to rein in bad actors in higher education, leaving the work to states attorneys general. Hate crimes on campus have also been ignored. In other cases, elite university endowments have received little notice despite eyebrow raising profits. Student loan asset-backed securities are also below their radar.

During the pandemic, The Department of Treasury has failed to adequately oversee funds issued to the Federal Reserve and the Small Business Administration funneled to subprime schools.

The Federal Trade Commission (FTC), which had done an adequate job investigating predatory lead generators and marketing and advertising false claims has been hamstrung by a recent court decision and can no longer fine higher ed wrongdoers. Predatory companies know this and will act accordingly—as criminals do when cops are not on the beat.

What lack of oversight have you seen with federal agencies tasked to protect higher education consumers?

Friday, July 12, 2024

Pending HEI Investigations

The Higher Education Inquirer (HEI) is working on a number of investigative projects. They include:

(1) Maximus is the sole contractor for the US Department of Education's Default Resolution Group (DRG) and its "Fresh Start" program. The DRG contract is set to expire, and information about their contract appears to have been removed from public view. DRG is likely to face more problems as defaults are expected to rise dramatically in late 2024.

(2) Subprime scholarship at America's largest online robocolleges, including Liberty University's online doctoral degrees in history and philosophy. We are communicating with subject matter experts to determine the extent of the problem.

(3) Our 6 1/2 year battle to obtain information about bad actors receiving Department of Defense Tuition Assistance (TA).

Approximately $600 million in tuition assistance each year is managed by DOD VOL ED and its contractors. About 100,000 servicemembers each year use TA benefits to pay for continuing education, and a disproportionate amount goes to robocolleges.

In 2017, as a continuation of Obama-era policies, contractors PwC and Gatehouse compiled a list of the 50 worst offenders, schools that were violating DOD MOU and President Obama's Principles of Excellence (Executive Order 13607).

Under President Trump, DOD refused to name the bad actors and did not punish anyone for their violations. In 2018, DOD education program analyst Anthony Clarke said that DOD did not want to create a "witch hunt." After 2019, the oversight program fell under the radar.

The University of Phoenix was implicated in a number of violations, but there is no record that DOD did anything to correct the situation, other than to reprimand at least one base commander. DOD has had a long-term relationship with predatory subprime colleges for years through the Council of College and Military Educators (CCME).

DOD has a current contract with Purdue University Global offering degrees of questionable academic value.

HEI has spent a great effort communicating with DOD officials, whistleblowers, and political aides, and following up with information that first appeared in in the Military Times in 2018 and 2019, then reappeared in 2024. We are also awaiting a substantive response from DOD FOIA 22-1203-F submitted in July 2022 that has received multiple delays and is not expected to be answered until October 4, 2024, about 1 month before the US federal elections.

Articles About Robocolleges

Articles About DOD Tuition Assistance

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Sunday, January 23, 2022

Maximus, Student Loan Debt, and the Poverty Industrial Complex

Thursday, December 12, 2024

Maximus AidVantage Contracts with the US Department of Education Publicly Available

Wednesday, April 13, 2022

College Meltdown 2.1

Monday, May 9, 2022

College Meltdown 2.2: Who’s Minding the Store?

Friday, July 12, 2024

Pending HEI Investigations