Sunday, July 29, 2007

For-Profit Education Regulation Failure

This article in the New York Times, illustrates how easy it is for black opps entrepreneurs such as Robert A. Berger, to weave their way through the blind spots between the for-profit regulatory triad which consists of state, federal and accreditors. There are many businessmen who see for-profit education as a way to make profits with no regard for the welfare of students or the quality of education. This is interesting in light of what is going on in California and the tug of war between the for-profits and consumer advocates over how much regulation is proper. Obviously, after reading this article you would be left with the thought that there wasn't enough regulation or the regulating bodies need to do a better job communicating with each other. The Department of Education can disqualify a school from receiving aid which is of course the lifeblood of these schools, however, it cannot close them, it leaves that to the states. A particularly pernicious operator can exploit the system and this man was quite willing to do that, even requesting financial aid in the name of other schools when his school no longer qualified.

This story also shows how difficult it is close a for-profit school down, ten years in this case, even with the regulation that we do have and even with the outlandish acts of the perpetrator of this fraud. Dozens of students swindled and the only recourse they have is to sue the school. In this case, not even the state can get several millions of dollars from the school or its operator so what there is not much chance of students getting their money back. These illustrates how a for-profit school is still one of the surest scams available.

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