Introducing Perdoceo: Under DeVos, Predatory Practices Pay
On January 2, Career Education Corporation (CEC) changed its name to Perdoceo, thus becoming the latest big for-profit college business to shed a name associated with predatory misconduct and switch to a pharmaceutical name. (Previous examples: Zovio, Adtalem.) Today, on a quarterly investor call, Perdoceo CEO Todd Nelson bragged of increased company revenues.
Trump education secretary Betsy DeVos has two top higher education aides: Diane Auer Jones and Robert Eitel. Both were previously senior executives at Career Education Corporation. Their former colleague William Hansen, the number two official at the Department of Education under George W. Bush, is on the board of directors of the company. DeVos’s former general counsel at the Department, Carlos Muniz, previously represented Career Education Corporation.
DeVos, Jones, and Eitel have eliminated many of the accountability rules and oversight that restrained predatory behavior by for-profit colleges. In this corrupt environment, bad-acting companies like Perdoceo, which operates American Intercontinental University and Colorado Technical University, are thriving.
Perdoceo CEO Nelson previously ran for-profit giants University of Phoenix/Apollo Education Group and then Education Management Corporation. Both companies got in trouble with the law for predatory practices carried out while he was in charge. So naturally Perdoceo wanted him.
A 2019 report by the research outlet Capitol Forum documented a decline in educational quality at Perdoceo/CEC under Nelson.
Perdoceo/CEC has had all kinds of law enforcement issues. In 2019, it agreed to pay $30 million to settle Federal Trade Commission charges of using deceptive third-party lead generators. It also reached a $494 million settlement with 49 state attorneys general over alleged deceptive practices.
In a filing with the Securities and Exchange Commission today, Perdoceo notes that it’s about to pay $7.1 million to settle claims by 310 students who alleged misrepresentations by a CEC culinary school.
So, Perdoceo: decline in educational quality + multiple law enforcement actions + CEO repeatedly associated with predatory abuses + new pharma name => another profitable quarter reported to investors. Under Trump and DeVos, predatory college practices still pay. And students suffer.