State attorneys general open major investigations of big for-profit colleges

Wednesday, January 29, 2014

In his State of the Union address, President Obama will likely revisit his plans to hold America's colleges and universities more accountable for helping U.S. students train for real careers. But while a stalemated Congress still blocks progress in many areas, a bipartisan group of state attorneys general just took a major step to help college students, especially veterans, single parents, and others struggling to support their families.

The house of cards built by the worst-performing higher education sector -- predatory for-profit colleges -- may at last be in peril of collapsing. In the past few days, four of the biggest for-profit college companies -- Career Education Corp., Corinthian Colleges, Education Management Corp., and ITT Tech -- all filed disclosures with the Securities and Exchange Commission saying they were now under investigation by state attorney generals. Each school said it was being probed by a group of 12-13 state AGs, with the AGs of Kentucky, Iowa, Pennsylvania, and Connecticut each taking the lead on investigating one of the companies. All four companies said they intended to cooperate. Kentucky Attorney General Jack Conway is leading a total of 32 state AGs who are investigating this troubled industry for misleading students about college costs, student loans, graduation rates, licensing requirements, placement results, and other matters.

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