For Immediate Release
April, 9 2020
Thirty-Three Leading Military & Veteran Service Organizations Praise VA Effort to Protect Veterans and Taxpayers from Schools that Mislead Prospective Students
The letter expresses support for VA’s enforcement of Title 38 U.S.C. Section 3696 and provides guidance to deter future abuse.
Washington, DC – Thirty-three military and veteran service organizations, including Veterans Education Success, sent a letter to the Hon. Robert Wilkie, Secretary of the U.S. Department of Veterans Affairs (VA), expressing their support to VA for its work “enforcing 38 U.S.C. § 3696, which is critical in stopping harm to veterans and military-connected students, protecting the GI Bill from fraud, and sending a deterrent message to other potential violators of federal law.”
The joint letter, led by Veterans Education Success, comes on the heels of VA’s enforcement action in March which notified five institutions of higher learning of VA’s intent to suspend new GI Bill enrollments in accordance with 38 U.S.C. 3696. Affected schools include the University of Phoenix, Career Education Corporation (recently renamed Perdoceo Inc.) institutions — including Colorado Tech and American Intercontinental University — Bellevue University, and Temple University. VA’s action would not affect currently-enrolled students at these schools, only new enrollments.
Title 38 section 3696 prohibits VA from approving enrollment of GI Bill beneficiaries to schools that use erroneous, deceptive, or misleading recruitment practices; a law which Veterans Education Success has consistently alerted VA to enforce to better protect veterans from predatory schools’ deceptive marketing and recruitment practices. This was also echoed in a 2016 Yale Law School report and in letters from three-dozen military and veteran organizations to VA in 2019 and 2016.
VA’s enforcement actions were triggered by the schools’ settlements with law enforcement for deceptive recruiting, including the University of Phoenix’s settlement of nearly $200 million with the US Federal Trade Commission and Career Education Corporation’s settlement of nearly $500 million with 49 states and an additional $30 million with FTC. Under the statute, VA must act when provided “preliminary findings” by FTC regarding deceptive recruiting.
Although military and veteran organizations are extremely busy working to ensure the health and protections of America’s vulnerable veterans during COVID-19, they were nevertheless quick to sign onto the letter to show support for VA’s historic action standing up for veterans.
“This is the strongest enforcement action by VA since the Post-9/11 GI Bill passed in 2008 and expanded education benefits to our brave women and men who served in the Armed Forces,” noted COL Robert Norton, USA-ret, Senior Advisor at Veterans Education Success and President of the Maryland Military Coalition. “Enforcement must deter future abuse. We call on VA to carefully consider our recommendations for how to enforce corrective action and discourage other institutions of higher learning from misleading veterans and their loved ones.”
Signatories also offered suggestions for VA as it evaluates the schools’ claims of having “corrective action.” Recommendations included ensuring VA’s action sends a deterrent message; paying careful attention to the schools’ history of law enforcement problems in evaluating any promises the schools make; stronger third-party monitoring of future recruiting; removing executives who perpetrated the fraud; and requiring schools to remove the pressure on recruiters by removing recruiters’ enrollment quotas and by voluntarily closing the 90/10 loophole, as DeVry did following its settlement with the US Federal Trade Commission in 2016.
The letter notes the critical need to alleviate institutional pressure for recruiters citing, “College recruiters deceive students because they are under boiler-room pressure to enroll new students. Schools should remove recruiters’ enrollment quotas and incentives and voluntarily close the 90/10 loophole.”
The 90/10 rule requires for-profit colleges to obtain at least 10% of their revenues from sources other than federal student aid. Due to an oversight in drafting, education benefits from the Departments of Defense and Veterans Affairs were left out of the calculation, thus creating a loophole in the law which for-profit schools continue to exploit. In an historic development, Maryland became the first state to close the loophole last month after strong advocacy by Veterans Education Success, The American Legion, and other veterans organizations. Following Maryland’s example, Veterans Education Success urges VA to increase pressure on institutions to close the loophole.
In closing, signatories noted they were “ready and willing to support” VA and Secretary Wilkie so that “military-connected students are supported during this time and in the future.”
About Veterans Education Success
Veterans Education Success is a veteran advocacy organization whose mission is to advance higher education success for veterans, service members, and military families, and to protect the integrity and promise of the GI Bill and other federal education programs. The organization offers free legal services, advice, and college and career counseling to servicemembers, veterans, their survivors, and families using federal education benefits – and helps them participate in their democracy by engaging with policymakers. Veterans Education Success also provides policy expertise to federal and state policymakers, and conducts non-partisan research on issues of concern to student veterans, including student outcomes and debt levels. Additional information is available at www.vetsedsuccess.org.