Attorney General Becerra: DeVos Keeps Students in the Dark When It Comes to Predatory For-Profit Schools

SACRAMENTO — California Attorney General Xavier Becerra, in a multistate letter with 21 attorneys general, today denounced the U.S. Department of Education’s proposal to eliminate gainful employment regulations that protect students from scams by for-profit schools. The 2014 Gainful Employment Rule requires that educational programs at for-profit colleges produce graduates who earn enough to pay back the debt incurred from attending the program. The rule was created in response to evidence from Federal and State investigations that for-profit schools had engaged in aggressive, deceptive marketing and recruiting by misrepresenting the potential earnings a student could expect to receive after graduation. The schools particularly targeted veterans, women, low-income students, students of color, and first-generation college students. The 2014 rule addresses these issues by establishing a strong accountability framework to protect consumers who were borrowing more than they could afford to attend schools that offered little or no return on investment. The Department of Education’s proposed plan to repeal the rule ignores numerous studies and years of student loan defaults and fails to provide any protection for students or taxpayers from schools that leave students saddled with debt that they are unable to repay. 

“The Gainful Employment Rule was implemented to address years of abuse and misrepresentation by the for-profit school industry, and to prevent federal student loan dollars from flowing to schools that provided their students with no job prospects and a mountain of debt,” said Attorney General Becerra. “It is unconscionable that the Department of Education would push to eliminate a rule meant to protect students and safeguard the federal student aid program. With this rule, Secretary DeVos once again demonstrates her favoritism for these unscrupulous for-profit schools over hard working Americans who are simply trying to improve their chances for success through education. This puts our students at a severe disadvantage by keeping them in the dark and putting their opportunities at risk.”

In the letter, the Attorneys General allege that the U.S. Department of Education’s proposed repeal of the 2014 Gainful Employment Rule:

• Fails to acknowledge its own history of enforcement actions.
• Ignores evidence it collected during the rule’s creation and provides no basis why this evidence is no longer valuable.
• Violates the Higher Education Act (HEA) requiring for-profit schools to provide “training for gainful employment in a recognized occupation.”
• Ignores Congress’s goal that students earn enough to repay their loans from educational programs.
• Fails veterans, women, low-income students, students of color, and first-generation college students who were deceived by for-profit colleges.
• Fails to comply with HEA rulemaking requirements.

On October 17, 2017, Attorney General Becerra joined a coalition of 18 Attorneys General in filing a lawsuit against the U.S. Department of Education for illegally delaying the implementation of the Gainful Employment Rule in violation of the Administrative Procedure Act. Attorney General Becerra also criticized the new proposal when it was announced on August 10, 2018.

A copy of the letter can be found here.