February 11, 2016

Senators: Education Dept Should Cut Off Aid To Colleges That Deny Students Their Day in Court

Today, nine Senators, led by Sherrod Brown (D-OH) and Dick Durbin (D-IL), called on the U.S. Department of Education to cut off federal student aid to colleges and universities that bar their students from going to court to pursue claims against their schools.

Addressing the same issue, some of the negotiators participating in the Department’s ongoing negotiated rulemaking on higher education issues are putting a similar proposal on the table ahead of next week’s meeting.

In their letter to Under Secretary of Education Ted Mitchell, the senators note that many for-profit colleges, and almost no non-profit colleges, …

Continue Reading »

February 10, 2016

Supreme Court Block on Climate Change Rule Is Unprecedented

Apparently for the first time ever, the U.S. Supreme Court last night, by a 5-4 vote, blocked a federal regulation from taking effect while that rule was still up for review in a federal appeals court.

The unprecedented maneuver by the Court’s five-Justice conservative majority stays implementation of the Obama Administration’s Clean Power Plan. That rule, issued last August by the U.S. Environmental Protection Agency, directs states to significantly scale back emissions of greenhouse gases from electric power plants. The regulation, a centerpiece of President Obama’s strategy to fight global warming and toxic pollution, would push utilities …

Continue Reading »

February 9, 2016

Who Owns the Colleges The Obama Administration Just Shut Down?

Last week the U.S. Department of Education took the rare step of cutting off federal student aid to two for-profit college chains, each accused of deceiving the Department and their own students. The allegations against the schools, while similar to abuses exposed at other schools in the past, are startling. But what’s also interesting is the ownership of the two chains: While one chain is a long-time family-owned and run operation, the other has been partly owned since 2004 by a well-connected New York private equity firm, Quad Partners, that includes former New Jersey Governor Thomas H. …

Continue Reading »

February 9, 2016

Education Dept. Sent Corinthian Students to Westwood. Now Westwood Is Closing …

Last spring, when for-profit Corinthian Colleges abruptly shut down under the weight of allegations of deceptive acts, Corinthian students had a choice under U.S. Department of Education rules: transfer to another school, or receive a “closed school discharge,” which would free them from the obligation of repaying the student loans they had incurred at the school. The Department seemed to be steering Corinthian’s students toward the transfer option. That may have been because forgiving the loans of all those Corinthian students would have created an enormous expense for taxpayers — perhaps hundreds of millions of dollars.

But because many …

Continue Reading »

February 8, 2016

University of Phoenix: New Boss, Same as Old?

Today, the University of Phoenix’s owner, Apollo Education Group, announced a $1.1 billion deal to be acquired by a consortium of investors including Apollo Global Management (no relation) and the Vistria Group, a private equity firm that includes Tony Miller, who was Deputy Secretary of Education under President Obama from 2009-2013. Miller would become Chairman of the Apollo Education Group Board. Would this be a good deal for America’s students and taxpayers?

The University of Phoenix, by far the largest for-profit college, has seen a dramatic decline in enrollments and revenues in recent years, as the public has become aware of …

Continue Reading »

February 8, 2016

Credit Suisse Analyst Who Touts DeVry Previously Touted Corinthian

Credit Suisse got the attention of Wall Street last week when it issued a report recommending that investors buy shares in one of the largest for-profit college companies, DeVry Education Group. The report came less than a week after the Federal Trade Commission sued DeVry for allegedly misleading students about job placement rates and salaries for the school’s graduates, with damages potentially reaching $8.6 billion.

The Credit Suisse analyst note, issued last Tuesday, told investors that DeVry shares were worth $29 — more than 50 percent higher than the trading value that day. On Wednesday, the stock closed up by 9.73% …

Continue Reading »

February 5, 2016

ITT Tech, Settling Shareholder Suits, Pledges Reforms

Last week, troubled for-profit college company ITT Tech settled a series of lawsuits brought by shareholders that charged ITT with various securities law violations.  Under the agreement, approved preliminarily by Manhattan federal judge J. Paul Oetken on Jan. 29 but still subject to objections by investors, ITT will pay lawyers for the plaintiffs $1.1 million and commit to a series of “corporate governance reforms,” including ITT commitments that:

Two-thirds of the ITT board of directors will be independent.
Bonuses and separation agreements will take into account executives’ compliance with the law.
ITT will publicly disclose its insider trading policy.
ITT will adopt a “Clawback and …Continue Reading »

February 3, 2016

Dear God Do Not Leave America Alone with Ted Cruz

Apparently 27.6 percent of Iowa Republican caucus goers — 51,666 people — think Senator Ted Cruz of Texas should be President of the United States. That made him the biggest winner coming out of Iowa, heading into the crucial New Hampshire primary.

Heaven help us if Ted Cruz becomes President. I’m not referring to his policy views, although I find those extreme and disturbing. I’m not even referring, really, to his aggressive embrace of a no-compromise approach to politics, which has alienated him from nearly every United States Senator, Republican and Democrat.

I’m focused on something else. There is …

Continue Reading »