DoD, VA, Education toughen rules against predatory colleges

Agencies are working toward implementing an executive order designed to crack down on "fly- by-night" colleges that target military members' education benefit...

The departments of Defense, Veterans Affairs and Education say they’re making progress toward implementing an executive order designed to protect military members and veterans from unscrupulous educational institutions. That effort includes a new regulatory scheme later this summer for colleges that accept money under the military’s tuition assistance program.

The interagency work is the result of an order President Barack Obama signed in April, establishing what the administration called “principles of excellence” for colleges and universities that serve veterans and servicemembers.

It was a response to concerns that some for-profit schools were targeting military members because of their benefits under the Post-9/11 GI Bill and the military’s tuition assistance programs. The problems included deceptive, aggressive recruiting of servicemembers on military bases, pressuring members into high- interest private loans instead of federal assistance programs and not providing enough information for members to make good college decisions.

“The executive order requires some specific tasks and deliverables that focus on enhancing the information and resources available to students, as well as strengthening oversight and accountability within federal education benefit programs,” said Robert Worley, director of the education service at VA during a recent webinar the three agencies hosted to describe the initiatives.

“It also encourages agencies to develop strategies that better address student concerns or complaints and challenges agencies to learn more about the students they serve through outcome measures that can inform future initiatives,” he said. Schools that serve students with funding from the Post-9/11 GI Bill will be asked to voluntarily agree to abide by the principles of excellence. In return, VA will publish their names in a list on its official GI Bill website. VA wants schools to signal their intent by June 30 so students getting ready for the fall semester will be able to tell which schools have agreed to abide by the principles and which haven’t.

Also, VA has submitted an application to the Patent and Trademark Office to trademark the phrase “GI Bill” to keep unscrupulous websites and other programs from using the name to scam veterans. VA said it hopes for a decision within 18 months.

The program for schools that accept military tuition assistance is tougher. In order to get those dollars, beginning this summer, colleges and universities will have to sign a memorandum of understanding with DoD.

“Some of the requirements are that all institutions must agree to participate in our third-party review process,” said Carolyn Baker, the chief of the voluntary education program for servicemembers in DoD. “Also, the institution agrees to review servicemembers military experience and training, and where it’s appropriate, they’ll apply it toward college credit.”

Additionally, the MOU would require schools to end fraudulent recruitment practices on military bases, provide students with an education plan, let servicemembers return to an education program if they have to leave because of deployment and create new refund policies.

Schools also would have to make sure students are aware of all of the federal loan and grant programs available to them before trying to set them up with private loans, said David Bergeron, the deputy assistant secretary for policy, planning and innovation for Education.

“We know from some research the department has done that we see individuals taking out private loans with less-beneficial terms before they take out federal loans,” he said. “We’re concerned that because of the life circumstances of veterans and servicemembers, they might be more likely to use those alternative routes to financing rather than accessing federal programs. So the executive order calls on institutions to have policies and procedures in place to make sure that those federal programs that are more beneficial are accessed first.”

Bergeron said the Education Department and the Consumer Financial Protection Bureau also are developing an online toolcalled “Know Before You Owe,” designed to compare the costs of tuition and loans between different programs. An early version is on the CFPB’s website, and the agencies are taking public comments on it through Wednesday.

Bergeron said the department also plans to update its existing College Navigator website with more detailed information about different educational institutions. Agencies also are developing a centralized, interagency system for military and veteran students to register complaints about schools. That project is a collaboration of the Education, Defense and Justice departments along with the CFPB.


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