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Sunday, August 17, 2025

College Prospects, College Targets

In the old American dreambook, a “college prospect” was a young person with ambition and promise—a student looking for a campus where they could grow intellectually, socially, and economically. But in today’s reality, “prospect” is an industry term, a sales category. In enrollment management suites across the country, prospective students aren’t just applicants; they’re targets.


[Image from Brown University, August 2025]

Higher education—whether elite, public, or for-profit—now runs on sophisticated marketing pipelines. The same predictive analytics used by corporations, political campaigns, and even law enforcement are deployed to track, segment, and convert students into paying customers. Colleges buy and sell student data from standardized test companies, online lead generators, and high school surveys. They follow “prospects” through their clicks, their campus visits, their FAFSA submissions—nudging them toward a deposit with personalized emails, algorithmically timed text messages, and calculated financial aid offers.

This is not about education first. It’s about yield rates, tuition revenue, and net tuition per student. For working-class families, first-generation students, and those from marginalized backgrounds, this targeting can be especially dangerous. The glossy brochures and “student success” slogans conceal the hard realities: inflated tuition, debt burdens that can last decades, and career outcomes far less rosy than advertised.

The for-profit sector perfected this playbook. Schools like Corinthian Colleges, ITT Tech, and the Art Institutes honed high-pressure recruiting scripts, built massive lead databases, and saturated social media feeds with ads promising quick career training and big paydays. When many of these institutions collapsed under federal scrutiny, their tactics didn’t disappear—they spread. Today, public universities and elite private schools use their own version of the same system, dressed up in more respectable branding.

At the top end of the prestige ladder, “targets” have a different profile. Elite schools scout “development prospects”—wealthy families whose applications are accompanied by the potential for multimillion-dollar gifts. The student is both a potential enrollee and a future donor pipeline. Recruitment here is less about financial aid and more about legacy admissions, networking dinners, and quiet tours with the president.

What all this targeting has in common is an imbalance of information. Colleges know almost everything about their prospects—income bands, likely majors, ability to pay—while students and families often have only the marketing copy and a sticker price. In this environment, independent, transparent information is a rare form of defense.

That’s where tools like TuitionFit and the CollegeViability app come in—not as recruitment aids, but as counterintelligence for families.

  • TuitionFit collects and shares real financial aid offers from students across the country. This allows families to see what schools are actually charging students with similar academic and financial profiles—not just the “average” cost schools advertise. By revealing the hidden discounting game, TuitionFit helps families avoid overpaying and resist the psychological pressure of “limited-time offers” from admissions officers.

  • The CollegeViability app compiles public financial data from the U.S. Department of Education and other sources to create an at-a-glance picture of an institution’s fiscal health. It tracks enrollment trends, tuition dependency, debt loads, and other risk factors—warning signs that a college might be on the verge of closing or slashing programs. Families who use it can see trouble coming long before the next headline about a sudden campus shutdown.

These are not small benefits. Every year, thousands of students are lured into institutions that overpromise and underdeliver. Some are blindsided by mid-program closures. Others graduate into underemployment with six figures of debt. Without tools like TuitionFit and CollegeViability, many would walk into these situations blind.

The troubling truth is that higher education’s recruitment machine treats students the same way a corporate sales funnel treats customers—and sometimes the way a military intelligence operation treats enemy assets. Prospects are acquired, qualified, engaged, and converted. They are ranked by “propensity to enroll,” courted by carefully timed contact, and celebrated in quarterly revenue reports.

The people making the targeting decisions rarely bear the costs of a bad outcome. If a student drops out with debt and no degree, it’s a personal tragedy, not a liability on the college’s balance sheet. If a school shutters with no warning, students and their families are left scrambling while administrators move on to new posts elsewhere.

College should be more than a precision-marketed capture. It should be a transparent, good-faith exchange where both sides have access to the same essential facts. Right now, that balance doesn’t exist—and the gap is being exploited.

Families who want to survive the recruitment gauntlet must treat it for what it is: a sales process backed by data analytics, designed to maximize institutional revenue, not student outcomes. That means using every independent resource available, asking hard questions, and refusing to be rushed into decisions.

In the end, the difference between being a college prospect and a college target might be whether you’re armed with real information—or just hope.

Sources:

  • The Century Foundation, College Admissions and the Business of Enrollment Management

  • U.S. Senate HELP Committee, For Profit Higher Education: The Failure to Safeguard the Federal Investment and Ensure Student Success

  • The Hechinger Report, How Colleges Use Big Data to Target Students

  • TuitionFit, About

  • CollegeViability, Institutional Health Indicators

Tuesday, July 15, 2025

HEI Files FOIA to Expose Delays and Disparities in Borrower Defense Discharges

The Higher Education Inquirer has submitted a Freedom of Information Act (FOIA) request to the U.S. Department of Education, seeking critical data on Borrower Defense to Repayment claims tied to some of the most notorious for-profit and career college chains in the United States. Filed on July 13, 2025, and formally acknowledged by the Department on July 14, this request seeks to uncover how many borrowers have received student debt relief, how many remain in limbo, and how many have been left in the dark despite being eligible.

The FOIA request includes a list of institutions with long histories of documented fraud, federal investigations, lawsuits, and closures. These include Corinthian Colleges (which operated Everest, Heald, and WyoTech), ITT Technical Institute, Westwood College, Marinello Schools of Beauty, the Art Institutes, Argosy University, American National University, Charlotte School of Law, DeVry University, Globe University/Minnesota School of Business, Independence University, Kaplan College/Kaplan University, Le Cordon Bleu, Missouri College, Mount Washington College, University of Phoenix, Virginia College, and Vatterott College.

For each institution, the Inquirer is requesting the number of borrowers identified for group discharge under the Borrower Defense authority. Of those, we are asking how many have had their loans discharged, how many cases remain pending, how many borrowers have been approved for discharge but not yet notified, and how many claims overlap with the class-action lawsuit Sweet v. McMahon (formerly Sweet v. Cardona and Sweet v. DeVos). For Corinthian Colleges specifically, the request also asks for the number of discharged borrowers under previous Department announcements and how many were also part of the Manriquez v. McMahon or Sweet settlements.

This data request covers the one-year period from July 13, 2024, to July 13, 2025, and asks for results in a structured, electronic format, preferably Excel.

The significance of this request cannot be overstated. Despite multiple well-publicized borrower defense settlements and mass discharge announcements, many defrauded students still have no clear idea whether they qualify for relief or when it might arrive. While the Department has made headlines for forgiving billions in student debt, especially for borrowers from predatory for-profit schools, those announcements often lack transparency and specificity. The FOIA request aims to fill those gaps and provide an accurate picture of the Department’s implementation of debt relief and justice for defrauded borrowers.

The Department of Education’s FOIA Service Center responded that the request has been received and is in queue. No further clarification is needed at this time, and no fees have been assessed. The Department did note that the current average processing time is 185 business days—over nine months. This timeline means that meaningful public disclosure may not happen until spring 2026, even as policymakers, advocates, and student debtors continue to push for faster relief and more accountability.

This FOIA request is part of the Higher Education Inquirer's ongoing efforts to investigate the afterlife of failed for-profit colleges, the bureaucratic delays in loan discharges, and the long shadow these schools have cast over the lives of working-class students. In many cases, these students were the first in their families to attend college and were aggressively targeted by institutions that promised fast-track careers and delivered financial ruin instead.

We will continue to monitor the Department’s response and will publish any findings we receive. If you are a former student of one of these schools and have filed a Borrower Defense claim—or have questions about whether you qualify—we invite you to share your experience. Your voice matters, and transparency is key to understanding how widespread the damage remains.

Contact the Higher Education Inquirer at gmcghee@aya.yale.edu.

Sources
U.S. Department of Education FOIA Acknowledgment Letter, July 14, 2025
FOIA Request No. 25-04397-F
Sweet v. Cardona (formerly Sweet v. DeVos), Case No. 19-cv-03674, N.D. Cal.
Manriquez v. DeVos, Case No. 3:17-cv-07210, N.D. Cal.
U.S. Department of Education Borrower Defense Updates – studentaid.gov

Friday, July 11, 2025

Flirtin' with Disaster: American Higher Education and the Debt Trap

They call it a “path to opportunity,” but for millions of students and their families, American higher education is just Flirtin' with Disaster—a gamble with long odds and staggering costs. Borrowers bet their future on a credential, universities gamble with public trust and private equity, and the system as a whole plays chicken with economic and social collapse. Cue the screeching guitar of Molly Hatchet’s 1979 Southern rock anthem, and you’ve got a fitting soundtrack to the dangerous dance between institutions of higher ed and the consumers they so aggressively court.

The Student as Collateral

For the last three decades, higher education in the United States has increasingly behaved like a high-stakes poker table, only it’s the students who are holding a weak hand. Underfunded public colleges, predatory for-profits, and tuition-hiking private universities all promise upward mobility but deliver it only selectively. The rest? They leave the table with debt, no degree, or both.

Colleges market dreams, but they sell debt. Americans now owe more than $1.7 trillion in student loans. And while some elite schools can claim robust return-on-investment, most institutions below the top tiers produce increasingly shaky value propositions—especially for working-class, first-gen, and BIPOC students. For them, education is often less an elevator to the middle class than a trapdoor into a lifetime of wage garnishment and diminished credit.

Institutional Recklessness

Universities themselves are no saints in this drama. Fueled by financial aid dollars, college leaders have expanded campuses like land barons—building luxury dorms, bloated athletic programs, and administrative empires. Meanwhile, instruction is increasingly outsourced to underpaid adjuncts, and actual student support systems are skeletal at best.

The recklessness isn’t limited to for-profits like Corinthian Colleges, ITT Tech, and the Art Institutes, all of which collapsed under federal scrutiny. Even brand-name nonprofits—think USC, NYU, Columbia—have been exposed for enrolling students into costly, often ineffective online master’s programs in partnership with edtech firms. The real product wasn’t the degree—it was the debt.

A Nation at the Brink

From community colleges to research universities, institutions are now being pushed to their financial and ethical limits. The number of colleges closing or merging has skyrocketed, especially among small private colleges and rural campuses. Layoffs, like those at Southern New Hampshire University and across public systems in Pennsylvania, Oregon, and West Virginia, show that austerity is the new norm.

But the real disaster is systemic. The American college promise—that hard work and higher ed will lead to security—is unraveling in real time. With declining enrollments, aging infrastructure, and increasing political pressure to defund or control curriculum, many schools are shifting from public goods to privatized risk centers. Even state flagship universities now behave more like hedge funds than educational institutions.

Consumers or Victims?

One of the cruelest ironies is that students are still told they are "consumers" who should “shop wisely.” But education is not like buying a toaster. There’s no refund if your college closes. There’s no protection if your degree is devalued. And there's no bankruptcy for most student loan debt. Even federal forgiveness efforts—like Borrower Defense or Public Service Loan Forgiveness—are riddled with bureaucratic landmines and political sabotage.

In this asymmetric market, the house almost always wins. Institutions keep the revenue. Third-party contractors keep their profits. Politicians collect campaign checks. And the borrowers? They’re left flirtin’ with disaster, hoping the system doesn’t collapse before they’ve paid off the last dime.

No Exit Without Accountability

There’s still time to change course—but it will require radical rethinking. That means:

  • Holding institutions and executives accountable for false advertising and financial harm.

  • Reining in tuition hikes and decoupling higher ed from Wall Street’s expectations.

  • Fully funding community colleges and public universities to serve as real social infrastructure.

  • Expanding debt cancellation—not just piecemeal forgiveness—for those most harmed by a failed system.

  • Ending the exploitation of adjunct labor and restoring the academic mission.

Otherwise, higher education in the U.S. will continue on its reckless path, a broken-down system blasting its anthem of denial as it speeds toward the edge.

As the song goes:
"I'm travelin' down the road and I'm flirtin' with disaster... I got the pedal to the floor, my life is runnin' faster."
So is the American student debt machine—and we’re all strapped in for the ride.


Sources:

  • U.S. Department of Education, Federal Student Aid Portfolio

  • “The Trillion Dollar Lie,” Student Borrower Protection Center

  • The Century Foundation, “The High Cost of For-Profit Colleges”

  • Inside Higher Ed, Chronicle of Higher Education, Higher Ed Dive

  • National Center for Education Statistics

  • Molly Hatchet, Flirtin’ with Disaster, Epic Records, 1979

Saturday, April 26, 2025

DOD continues to shield bad actor schools that prey upon military servicemembers

For more than seven years, we have been waiting to obtain information from the US Department of Defense (DOD) about schools that prey upon servicemembers using DOD Tuition Assistance to further their college aspirations. And we have done it at our peril, repeatedly taking flak from people in DC.  

As the Higher Education Inquirer reported earlier, DOD and these schools have had questionable relationships with these schools going back to the 1980s, with the for-profit college takeover of CCME, the Council of College and Military Educators.  

Those who follow the higher education business know the names of the bad actors, some that are still in business (like the University of Phoenix and Colorado Tech) and some that have closed (like ITT Tech and the Art Institutes). Others have morphed into arms of state universities (Kaplan University becoming Purdue University Global and Ashford University becoming University of Arizona Global). 

Accountability was supposed to happen during the Obama administration (with Executive Order 13607) but those rules were not fully implemented. Under the first Trump administration, these safeguards were largely ignored, and bad actor schools faced no penalties.  

Some of these scandals were reported in the media, and have been forgotten.

On April 1, 2025 we were again supposed to receive information about these bad actor schools, and the DOD officials who were complicit.  It didn't happen. That FOIA (22-1203) which was initiated in July 2022 is now scheduled for a reply on July 3, 2025, three years from the original submission. 

Previous FOIAs from 2019 also came up with no information.  And requests for information in 2017 from DOD officials were met with harassment from other parties. 

The only thing we can be grateful for is that DOD continues to communicate with us. 

 

Related links:

Trump's DOD Failed to Protect Servicemembers from Bad Actor Colleges, But We Demand More Evidence 

DoD review: 0% of schools following TA rules (Military Times, 2018)

Schools are struggling to meet TA rules, but DoD isn’t punishing them. Here’s why. (Military Times, 2019)

Friday, January 17, 2025

Biden-Harris Administration Announces Final Student Loan Forgiveness and Borrower Assistance Actions (US Department of Education)

Total Approved Student Debt Relief Reached Almost $189 Billion for 5.3 Million Borrowers

The Biden-Harris Administration today announced its final round of student loan forgiveness, approving more than $600 million for 4,550 borrowers through the Income-Based Repayment (IBR) Plan and 4,100 individual borrower defense approvals. The Administration leaves office having approved a cumulative $188.8 billion in forgiveness for 5.3 million borrowers across 33 executive actions. The U.S. Department of Education (Department) today also announced that it has completed the income-driven repayment payment count adjustment and that borrowers will now be able to see their income-driven repayment counters when they log into their accounts on StudentAid.gov. Finally, the Department took additional actions that will allow students who attended certain schools that have since closed to qualify for student loan discharges. 

“Four years ago, President Biden made a promise to fix a broken student loan system. We rolled up our sleeves and, together, we fixed existing programs that had failed to deliver the relief they promised, took bold action on behalf of borrowers who had been cheated by their institutions, and brought financial breathing room to hardworking Americans—including public servants and borrowers with disabilities. Thanks to our relentless, unapologetic efforts, millions of Americans are approved for student loan forgiveness,” said U.S. Secretary of Education Miguel Cardona. “I’m incredibly proud of the Biden-Harris Administration’s historic achievements in making the life-changing potential of higher education more affordable and accessible for more people.” 

From Day One the Biden-Harris Administration took steps to rethink, restore, and revitalize targeted relief programs that entitle borrowers to relief under the Higher Education Act but that failed to live up to their promises. Through a combination of executive actions and regulatory improvements, the Biden-Harris Administration produced the following results for borrowers: 

Fixed longstanding problems with Income-Driven Repayment (IDR). The Administration has approved 1.45 million borrowers for $57.1 billion in loan relief, including $600 million for 4,550 borrowers announced today for IBR forgiveness. 

IDR plans help keep payments manageable for borrowers and have provided a path to forgiveness after an extended period. These plans started in the early 1990s, but prior to the Biden-Harris Administration taking office, just 50 borrowers had ever had their loans forgiven. The Administration corrected longstanding failures to accurately track borrower progress toward forgiveness and addressed past instances of forbearance steering whereby servicers inappropriately advised borrowers to postpone payments for extended periods of time. These totals also include borrowers who received forgiveness under the Saving on a Valuable Education (SAVE) plan prior to court orders halting forgiveness under the SAVE plan. 

Today, the Department also announced the completion of the IDR payment count adjustment, correcting eligible payment counts. While the payment count adjustment is now complete, borrowers who were affected by certain servicer transitions in 2024 may see one or two additional months credited in the coming weeks. The Department is also launching the ability for borrowers to track their IDR progress on StudentAid.gov. Borrowers can now log in to their accounts and see their total IDR payment count and a month-by-month breakdown of progress.   

Restored the promise of Public Service Loan Forgiveness (PSLF). The Administration has approved 1,069,000 borrowers for $78.5 billion in forgiveness.  

The PSLF Program provides critical support to teachers, service members, social workers, and others engaged in public service. But prior to this Administration taking office, just 7,000 borrowers had received forgiveness and the overwhelming majority of borrowers who applied had their applications denied. The Biden-Harris Administration fixed this program by pursuing regulatory improvements, correcting long-standing issues with tracking progress toward forgiveness and misuse of forbearances, and implementing the limited PSLF waiver to avoid harm from the pandemic. 

Automated discharges and simplified eligibility criteria for borrowers with a total and permanent disability. The Administration has approved 633,000 borrowers for $18.7 billion in loan relief. 

Borrowers who are totally and permanently disabled may be eligible for a total and permanent disability (TPD) discharge. The Biden-Harris Administration changed regulations to automatically forgive loans for eligible borrowers based upon a data match with the Social Security Administration (SSA). This helped hundreds of thousands of borrowers who were eligible for relief but hadn’t managed to navigate paperwork requirements. The Department also made it easier for borrowers to qualify for relief based upon SSA determinations, made it easier to complete the TPD application, and eliminated provisions that had caused many borrowers to have their loans reinstated. 

Delivered long-awaited help to borrowers ripped off by their institutions, whose schools closed, or through related court settlements. The Administration has approved just under 2 million borrowers for $34.5 billion in loan relief.  

For years, students had sought relief from the Department through borrower defense to repayment—a provision that allows borrowers to have their loans forgiven if their college engaged in misconduct related to the borrowers’ loans. The Department delivered long-awaited relief to borrowers who attended some of the most notoriously predatory institutions to ever participate in the federal financial aid programs. This included approving for discharge all remaining outstanding loans from Corinthian Colleges, as well as group discharges for ITT Technical Institute, the Art Institutes, Westwood College, Ashford University, and others. The Department also settled a long-running class action lawsuit stemming from allegations of inaction and the issuance of form denials, allowing it to begin the first sustained denials of non-meritorious claims. 

Today, the Department also approved 4,100 additional individual borrower defense applications for borrowers who attended DeVry University, based upon findings announced in February 2022.  

“For decades, the federal government promised to help people who couldn’t afford their student loans because they were in public service, had disabilities, were cheated by their college, or who had completed decades of payments. But it rarely kept those promises until now,” said U.S. Under Secretary of Education James Kvaal. “These permanent reforms have already helped more 5 million borrowers, and many more borrowers will continue to benefit.” 

The table below compares the progress made by the Biden-Harris Administration in these key discharge areas compared to other administrations. 

 Borrowers approved for forgiveness 
 Prior Administrations Biden-Harris Administration 
Borrower Defense (Since 2015) 53,500 1,767,000* 
Public Service Loan Forgiveness (Since 2017) 7,000 1,069,000 
Income-Driven Repayment (all-time) 50 1,454,000 
Total and Permanent Disability (Since 2017) 604,000 633,000 

* Includes 107,000 borrowers and $1.25 billion captured by an extension of the closed-school lookback window at ITT Technical Institute.  

Additional actions related to closed school discharges 

The Department today also announced additional actions that will make more borrowers eligible for a closed school loan discharge. Generally, a borrower qualifies for a closed school discharge if they did not complete their program and were either still enrolled when the school closed or left without graduating within 120 days before it closed. . However, the Department has determined that several schools closed under exceptional circumstances that merit allowing borrowers who did complete and were enrolled in the school more than 120 days prior to the closure to qualify for a closed school discharge. justify extending the look-back window beyond the applicable 120 or 180 days--allowing additional borrowers to qualify for a closed school discharge. Generally, eligible borrowers will have to apply for these discharges, but the Secretary has directed Federal Student Aid to make borrowers aware of their eligibility, and to pursue automatic discharges for those affected by closures that took place between 2013 and 2020 and who did not enroll elsewhere within three years of their school closing. 

These adjusted look-back windows are: 

  • To May 6, 2015, for all campuses owned at the time by the Career Education Corporation (CEC), which have since closed. That is the day CEC announced it would close or sell all campuses except for two brands. This affected the Art Institutes, Le Cordon Bleu, Brooks Institute, Missouri College, Briarcliffe College, and Sanford-Brown. 
  • To December 16, 2016, for campuses owned by the Education Corporation of America (ECA) on that date that closed. ECA operated Virginia College, Brightwood College, EcoTech, and Golf Academies and started on the path to closure after its accreditation agency lost federal recognition and ECA could not obtain accreditation elsewhere. 
  • To October 17, 2017 for all campuses owned or sold on that date by the Education Management Corporation (EDMC) and that later closed. That is the day EDMC sold substantially all of its assets to Dream Center Educational Holdings. The decision affects borrowers who attended the Art Institutes, including the Miami International University of Art & Design and Argosy University.  
  • To April 23, 2021, for Bay State College. That is the day this Massachusetts-based college began to face significant accreditation challenges, which eventually led to the school losing accreditation and closing in August 2023. 

Borrowers who want more information about closed school discharge, including how to apply, can visit StudentAid.gov/closedschool

A state-by-state breakdown of various forms of student debt relief approved by the Biden-Harris Administration is available here.

Wednesday, December 11, 2024

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.] 

Wednesday, October 23, 2024

College Inc. Redux is Overdue

We desperately need a PBS Frontline updating of College Inc. This 2010 documentary by Martin Smith and Rain Media took us behind the curtains, into the big business of US for-profit higher education. At the time, College Inc. made an important statement: that for-profit higher education had become a racket, funded by greedy Wall Street investors, and that government oversight was necessary to rein in the worst abuses at schools like Corinthian Colleges and Ashford University.

 
 
From 2010 to 2012, the Senate Harkin Commission researched and exposed the systemic abuses of the largest for-profit colleges. And under President Obama, some of these abuses were addressed through policy changes at the US Department of Education, Department of Veterans Affairs, and Department of Defense. 
 
Times Have Changed, Not In a Good Way
 
Much has happened in the last decade and a half since College Inc. was produced. US higher education did not become less predatory, even as a number of for-profit colleges (Corinthian Colleges, ITT Tech, Art Institutes, Le Cordon Bleu, and Virginia College) were shuttered. Republicans worked to ensure that meaningful policy changes, like gainful employment safeguards, were blocked. And some of the worst predators (Kaplan and Ashford) morphed into businesses owned by state universities (Purdue and University of Arizona).
 
Online education has become pervasive despite concerns about its effectiveness. Content creators and facilitators have replaced instructors at large robocolleges like Southern New Hampshire University, Grand Canyon University, Liberty University Online, and the University of Phoenix
 
The for-profit (aka neoliberal) mentality has spread. Online Program Managers (OPMs) have brought for-profit education to non-profit institutions, carrying with it an enormous cost to consumers. Advertising and marketing has become out of control, helping fuel a manufactured College Mania of anxious parents and their children. 
 
Despite the College Mania, folks have become more skeptical of higher education, and for good reason. Student loan debt has further crippled the lives of millions of Americans as Republicans have stepped in to block debt forgiveness. Community colleges and some state universities have gone through significant enrollment declines. Small colleges have closed. And elite colleges have become more wealthy and powerful and controversial. Something not on the radar in the 2010 documentary or in popular culture at the time. 

Sunday, September 29, 2024

Layoffs in Higher Education

The Layoff.com is a "simple discussion board" for workers who would like to learn more about the rumors or possibility of job cuts in their organization. It's also been helpful for us to understand what has been happening behind the scenes in the US Higher Education business. 

We have been observing and participating on this website for more than a dozen years, watching the fall of Corinthian Colleges (Everest College, Wyotech, and Heald), ITT Tech, Education Management Corporation (the Art Institutes and South University), the partial collapse of Apollo Group (University of Phoenix), Perdoceo (formerly Career Education Corporation), and Laureate International, and the transformation of Kaplan University to Purdue University Global and Bridgepoint Education (Ashford University) to University of Arizona Global.   
 
 
 
As the College Meltdown has advanced, we have also observed a number of private schools collapse and public colleges and universities struggle. As enrollments continue to drop, we can expect more layoffs to occur and for education related businesses to struggle more.  
 
The contents of this article are updated periodically, to illustrate trends in the College Meltdown.  The most recent update was published October 29, 2024.  2U, the online program manager for elite university certificates has been the poster child in 2024, but there are many other companies and institutions in peril.  

 
 
 
 

 

 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


 
 
 
 
 
 
 

 
Wittenberg University 

Sunday, February 25, 2024

Letter to Secretary of Education Miguel Cardona Regarding Borrower Defense to Repayment and Gainful Employment Regulation (Michael DiGiacomo)

Dear Secretary Cardona, Department of Education Staff, and Regulating officials,

My name is Michael DiGiacomo. I am a former student and victim of two closed for-profit scam colleges and the student loan industry. I have been fighting this industry since 2003-2006, when I realized I had been played badly by these deceptive debt factories. 
 
These "colleges," and others like them, were easily able to trick not just me, but many thousands of poor, first-time people into attending. The false promises of dream job placement stats and leads, fueled by the student loan industry's "College Students make A Million Dollars More" pitch, along with high pressure tactics, lack of financial understanding, and easy access to government funds made us all the prime target for these scamsters. 
 
They also piled on fraudulent private student loans as they worked hand-in-hand with commercial lenders to help themselves fleece the 90/10 requirement to gain more federal money funds. The promise of the future our parents and grandparents had was turned into a scam to fuel the next big bubble and wallets of those schools, the industry, and their lobbyists.  
Now, after having gone through this fight for almost 20 years, through the recruitment lies, joblessness, default, garnishment, depression, hopelessness, and the unknown, I have fought to have my federal student loans canceled as part of Sweet v Cardona [DEVOS] and the defense to repayment process. I am still miles away from relief. 
 
The paychecks, garnished for federal loan money by Sallie Mae-owned debt collectors for years, will never be returned as they somehow escape the parameters of the Sweet v Cardona [DEVOS] settlement. 
 
I spent years choosing between food or gas to get to work because federal student loan garnishments don't take those necessities into account when they rip away your paycheck. I have also not been refunded for years of payments made to the US Department of Education and Nelnet now that the federal loans have been closed in the settlement. 
 
My GI BILL even dried up/time ran out because I was too ruined financially and burned by those schools to want to finally return to ANY college again. Unfortunately, I am not alone on this. Over and over again I have heard the same stories. I have lost friends, have seen people alienate family, or even abandon our country. 
 
Now with Sweet v Cardona [DEVOS] class and post class members, I have heard that even with evidence, payments are not returned even though the loans are closed. I have seen servicers that are supposed to be helping class members [and post class] become whole pinball students away from them back to the department of education or others or give flat out incorrect information. 
 
And why does the class not cover federal loans held by Sallie Mae or other pre-Obamacare lenders? 
 
Why should the same corporate banks that helped the scamster schools be allowed to keep the funding? 
 
Why should the crooks be allowed to keep the robbery purse? 
 
Why is the process of getting a federal loan legally closed so hard?
 
Why is there no federal program in place to help with the predatory/fraudulent private student loans?
 
The processes for Defense to Repayment and the Gainful Employment regulations are hard to follow for someone as knowledgeable as myself about this, never mind a first time student or parent with no experience in the process. Clearly the "Colleges" aren't being honest in the first place to their customers, never mind slow regulators and watch dogs. 
 
I have watched the Student Aid website under serve people applying to defense to repayment they rightfully should be able to use. I have watched it only allow one school when they were hit by multiple. I have seen the website break or take minutes just to type the final name line. This is inexcusable since this is the one chance for people to make things right.  
The government guaranteed funding needs to be heavily protected on what schools get access to, and on the other side students need to be easily able to be made whole when it turns out there is systematic fraud. The fraudsters are faster than the government patches to fix it. 
 
Often when someone gets hit by one for-profit college, they get easily hit by a second one thinking the first was an isolated incident. 
 
I have watched this fight and have been part of it for too long to watch it happen all over again. Regulation needs to be strong on the part of protecting borrowers and easy for borrowers to be made whole. The promise of a government accredited college should be just that. It should not be just an arm of a corporate entity or allowed to be made "Not-for-profit" just because they worded it differently. 
 
The same corporate CEO's should not be trading companies and schools around like baseball cards or like whack a mole game once the one before it crashes down. Please put borrowers first if you want to have an educated society and protect them from corporate scamsters. And if somehow the scamsters DO get the upper-hand, please make it easier and more understandable for borrowers to get made whole.
 
When I joined the Army, I made a promise I would protect this country from all threats, foreign and domestic. The for-profit college and student loan industry is a domestic threat to this country and the public. They have decimated generations of prospective students and you still haven't fully picked up the pieces yet. 
 
Sincerely, Michael DiGiacomo
Veteran US Army
Victim of the New England Institute of Art aka "The Art Institutes" Aka Education Management Corporation
Victim of Katherine Gibbs aka Gibbs aka Sanford Brown aka Career Education Corporation
Victim of SallieMae aka USAFunds Aka Pioneer Credit Aka Navient

Monday, September 25, 2023

Art Institutes Close. Students May Be Eligible for Student Loan Forgiveness.

The Art Institutes (Ai) is closing its doors this Friday, September 30. Ai has locations in Miami and Tampa (FL), Atlanta (GA), Austin and Houston (TX), and Virginia Beach (VA). About 2000 students are affected.  The Art Institutes website provides closed school information.


The Art Institutes chain had a storied history, starting in Pittsburgh, Pennsylvania in 1921 and growing to 50 locations by 2010. Its boom was the result of intensive profit-making in the higher education business in the 1990s and early 2000s. Goldman Sachs was a key contributor to its explosive growth.

Ai's decade-long decline was part of a wave of for-profit colleges that faced increased federal scrutiny for low graduation rates, high levels of student loan debt, and declining enrollment. Unlike Corinthian Colleges (2015), ITT Tech (2016), Westwood College (2016), and Virginia College (2018), the Art Institutes survived with government assistance--but with less than ten campuses. 

Art Institute Students 

Students from the Art Institutes may transfer to other schools, but many of their credits may not be accepted by other institutions. Consumers should also be extremely wary of the schools they plan transferring to.  

Students would normally be allowed to have their student loans forgiven through a process called Closed School Discharge. But that avenue for remedy has been paused. Present and former students, however, may be able to have their student loan debt relieved through Borrower Defense to Repayment if they can prove that they were defrauded. 

Borrower Defense-Sweet vs Cardona is a Facebook space for people who have already succeeded in getting their student loan money returned to them and others working on claims. Borrower Defense-Sweet vs Cardona has more than 14,000 members. 

Monday, April 10, 2023

EdTech Meltdown

The Silicon Valley tech downturn has been creating reverberations in other parts of the economy and in other areas of the US.

Edtech, a small subset of the tech industry that overlaps with higher education, is facing major headwinds as skepticism about higher education and the economy grows.  Even two industry insiders, Noodle CEO John Katzman and Kaplan executive Brandon Busteed have been critical of the short-term thinking and questionable outcomes of edtech. Katzman has called some companies in the space "more adtech than edtech," implying that some do little more than marketing and advertising for colleges and universities.     

Ultimately, it's US consumers who are feeling the greatest pain as participants in online education--a mode of instruction that for millions of people may have more risks than benefits--within an increasingly dysfunctional economy that produces expensive education and fewer good jobs.   

Significant problems that were observed in large subprime colleges like University of Phoenix, Corinthian Colleges, ITT Tech, DeVry University, Colorado Tech, and the Art Institutes more than a dozen years ago have resurfaced in edtech.  And other problems unique to edtech have emerged. 

Chegg is an edtech company based in Santa Clara, California, and provides homework help, online tutoring, and other student services.  The company's value grew more than 300 percent in 2020, during the Covid pandemic, but has faced headwinds for the last two years. This includes allegations that  Chegg enables students to cheat on homework and other assignments. Derek Newton has chronicled this problem in the substack The Cheat Sheet.

[Chegg shares grew in 2020 during the Covid pandemic. Source: Seeking Alpha] 

 
Coursera is a publicly traded MOOC based in Mountain View California.  Shares started trading in April 2021.  The company has under-performed as a profit making enterprise. Massive Open Online Courses were once seen as a wave of the future in adult education but their popularity has waned. 

[Coursera has underperformed since its IPO in April 2021.  Source: Seeking Alpha]

2U (based in Lanham, MD) and Guild Education (based in Denver) and are two edtech companies based outside of Silicon Valley. 

2U is a publicly traded Online Program Manager (OPM).  The company services major universities such as the University of Southern California and University of North Carolina with support for some of their online degree programs. 2U has received an enormous amount of funding from Cathie Wood, a major Silicon Valley investor, and has continued to receive support despite a long record of financial losses.  

Some 2U investors have grown tired of persistent losses--and it has shown in the declining share price. The company also faces increased scrutiny in DC for recruiting consumers unable to recoup the cost of education for high-priced masters degrees in areas such as social work.  2U acquired edX, the Harvard-MIT MOOC in 2021 and its profitability remains to be seen.  

In 2023, 2U sued the US Department of Education for attempting to require more transparency between OPMs and their clients.  This strategy is similar to the defensive strategy that subprime colleges have used to stop gainful employment regulations, and more recently, borrower defense to repayment rules.  

 


 [2U shares have dropped more than 90 percent over the last 5 years. Source: Seeking Alpha]

Guild Education is a privately held corporation that grew to an estimated $4.4B evaluation in a few years. Guild serves businesses by administering online education benefits for large corporations such as Walmart, Target, and Macy's.  While its work may help companies with their bottom line, they appear to do little for their workers. 

At least ten of Guild's investors are based in Silicon Valley, including Silicon Valley Bank and venture capital firms in San Francisco, Palo Alto, and Menlo Park, California. Valuations.fyi reports Guild's estimated value at $1.3B, a 70 percent drop from its peak in June 2022. 

 
[Image above: Guild's valuation in Billions from valuations.fyi]
 
The Higher Education Inquirer will continue to observe changes in edtech as the College Meltdown advances.  


A ‘rigged’ economy and skepticism about college (Paul Fain, Open Campus)

How University of Phoenix Failed. It's a Long Story. But It's Important for the Future of Higher Education. 

The Cheat Sheet (Derek Newton)

2U Virus Expands College Meltdown to Elite Universities 

Erica Gallagher Speaks Out About 2U's Shady Practices at Department of Education Virtual Listening Meeting

Borrower Defense Claims Surpass 750,000. Consumers Empowered. Subprime Colleges and Programs Threatened.

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

College Meltdown 2.0 

The Growth of "RoboColleges" and "Robostudents"

The American Dream is Over (Gary Roth) 

Monday, April 3, 2023

Higher Education FOIA Requests to US Department of Education

The Higher Education Inquirer has made a number of Freedom of Information Act (FOIA) requests to the US Department of Education.  Here's our current list.  

 

23-01436-F 

The Higher Education Inquirer is requesting copies of the current contracts between the US Department of Education and Maximus (including but not limited to subsidiaries such as AidVantage). If this is not possible we would like the reported dollar amount for each contract. This request is part of a larger effort to assess the student loan debt portfolio. (Date Range for Record Search: From 01/01/2010 To 04/03/2023)

23-01426-F  

The Higher Education Inquirer is requesting the dollar amount of student loan funds issued to for-profit colleges each year from 1972 to 2021.  We will accept interim or partial data.  (Date Range for Record Search: From 01/01/1973 To 04/03/2022)


23-01369-F  
 
The Higher Education Inquirer is requesting an estimate of the number of student loans in the student loan portfolio that originated (1) before 1978, (2) before 1983, (3) before 1988, and (4) before 1993.  This is part of a larger effort to understand the estimated $674B in unrecoverable student loan debt.   (Date Range for Record Search: From 01/01/2023 To 03/28/2023)

23-01324-F  
 
The Higher Education Inquirer is requesting a count of the number of Borrower Defense to Repayment claims against South University and the Art Institutes, in the Consumer Engagement Management System (CEMS) up to January 1, 2023.  We would also like to know if their parent company, Education Principle Foundation (EPF), is listed as the owner of both schools in the CEMS computer database.   (Date Range for Record Search: From 01/01/2023 To 03/22/2023)

23-01263-F
 
The Higher Education Inquirer is requesting a list of all the variables/categories in the Consumer Engagement Management System (CEMS).  CEMS is mentioned in FOIA 22-01683F filed by the National Student Legal Defense Network.   (Date Range for Record Search: From 01/01/2023 To 03/16/2023)

23-00865-F 
 
We are requesting an accounting of US Department of Education Borrower Defense to Repayment (BD) claims against the University of Phoenix.  Specifically, we are asking for the (1) number of BD claims, (2) the number processed, and (3) the number approved.  The date range is from February 20, 2016 to January 26, 2023. If there is a reasonable way to estimate the total dollar amount in a timely manner, we would also like that.  This request is similar to FOIA request 22-03203-F, and is a result of discovering that the University of Arkansas System has been in negotiations to acquire University of Phoenix through a nonprofit organization.   (Date Range for Record Search: From 02/20/2016 To 01/26/2023)
 
Related links:
 
 
 
 

 
 
 

Thursday, March 16, 2023

Borrower Defense Claims Surpass 750,000. Consumers Empowered. Subprime Colleges and Programs Threatened.

The Higher Education Inquirer has posted a number of articles about student loan debt. In 2023, the student loan mess has reached epic proportions. Not only has the US Federal Student Aid debt portfolio reached more than $1.6 Trillion, we learned that $674 Billion was estimated to be unrecoverable. 

In California, the US District Court in Sweet v Cardona agreed to a $6 Billion settlement between student debtors and the US Department of Education. 

In Texas, a group representing for-profit colleges has sued the US Department of Education for their actions in settling Borrower Defense claims. 

And across the US, about 40 million student debtors and their families are awaiting a decision from the US Supreme Court—a decision that will not likely favor the debtors.

Borrower Defense, Subprime Colleges, Subprime Programs

Borrower Defense to Repayment claims are claims by student loan debtors that their school misled them or engaged in other misconduct in violation of certain state laws. The Department of Education may discharge all or some of the student loan debt and hold the school and its owners responsible. 

As of January 2023, there are more than three quarters of a million Borrower Defense claims against schools. And each month, about 16,000 new claims are added.  Evidence from the Sweet v Cardona case revealed that only about 35 workers were responsible for processing hundreds of thousands of claims. Those claims have been disproportionately made against a number of for-profit colleges and formerly for-profit colleges, what we call “subprime colleges.”   

Some of these subprime schools have closed (Everest College, ITT Tech, and Westwood College for example), some remain in business as for-profit colleges (like University of Phoenix and Colorado Tech), some have changed names and become covert for-profit colleges or robocolleges (like Purdue University Global, University of Arizona Global Campus, and the Art Institutes), and some schools act act like subprime colleges regardless of tax status. This includes low-return on investment programs at several US robocolleges and overly expensive graduate programs offered by 2U, an online program manager for elite colleges.  

In the Sweet v Cardona case, more than 200,000 student borrowers are expecting to receive full debt relief after years of struggling.  A Facebook group Borrower Defense-Sweet vs. Cardona currently has more than 14,000 members. 


Named plaintiffs Theresa Sweet (L) and Alicia Davis (R) outside the federal district court in San Francisco on November 6, 2022, three days before the final approval hearing in Sweet v Cardona (Image credit: Ashley Pizzuti)

Transparency and Accountability 

The US Department of Education keeps an accounting of Borrower Defense claims, but only publishes the aggregate numbers, not institutional numbers. Those institutional numbers do make a difference in promoting transparency and accountability for the largest bad actors. So why does the Department of Education not publish those institutional numbers?
 
The National Student Legal Defense Network submitted a FOIA (22-01683F) to the US Department of Education (ED) in January 2022 asking just for that information. And what HEI has discovered is that just a small number of schools garnered the lion's share of the Borrower Defense claims. To get a digital copy of that information, please email us for a free download.

Related links:

Borrower Defense-Sweet vs Cardona (Facebook private group)  

Project on Predatory Student Lending

Sweet v. Cardona Victory (Matter of Life and Debt podcast)

I Went on Strike to Cancel My Student Debt and Won. Every Debtor Deserves the Same. (Ann Bowers)

An Email of Concern to the People of Arkansas about the University of Phoenix (Tarah Gramza)


The Growth of "RoboColleges" and "Robostudents"