The United States Government Accountability Office released a report Wednesday examining “deceptive and questionable marketing practices” used in 15 of the nation’s colleges.
The investigation was conducted with the help of GAO representatives, who posed as prospective students looking to apply at the schools. According to the report, the colleges were selected based on “several factors, including those that the Department of Education reported received 89 percent or more of their revenue from federal student aid.” The report detailed the results of the undercover tests and found that four of the schools “encouraged fraudulent practices,” while all 15 made deceptive statements to undercover applicants.
One admissions representative told an applicant to fraudulently remove $250,000 in savings. Other college representatives exaggerated undercover applicants’ potential salary after graduation and failed to provide clear information about the college’s program duration, costs, or graduation rate despite federal regulations requiring them to do so. For example, staff commonly told GAO’s applicants they would attend classes for 12 months a year, but stated the annual cost of attendance for 9 months of classes, misleading applicants about the total cost of tuition.
The Senate Health, Education, Labor and Pensions Committee released the names of the schools involved in the investigation on Wednesday. Among them was Florida’s Kaplan branch, located in Pembroke Pines. According to the report, that “fraudulent removal of $250,000” occurred at Kaplan: “The representative told the applicant to come back once the fraudulent financial information changes had been processed.”
In another instance in Florida, a test proctor “sat in the test taking room with the investigator and coached her” while she took a test. In another scenario, a representative gave her opinion on loan repayments:
On paying back loans, the representative said: “You gotta look at it. … I owe $85,000 to The University of Florida. Will I pay it back? Probably not. … I look at life as tomorrow’s never promised. … Education is an investment, you’re going to get paid back ten-fold, no matter what.”
The report also detailed misleading reports of a college’s pedigree, in which admissions representatives failed to properly identify their schools’ accrediting organization:
A representative at a college in Florida owned by a publicly traded company told an undercover applicant that the college was accredited by the same organization that accredits Harvard and the University of Florida when in fact it was not. The representative told the undercover applicant: “It’s the top accrediting agency—Harvard, University of Florida—they all use that accrediting agency. … All schools are the same; you never read the papers from the schools.”
Several other representatives lied about financial aid information, as well as salaries one can expect upon graduating. In one instance, an admissions officer at a small beauty college told an undercover investigator that they could expect to earn “$150,000 to $250,000 a year.” According to the Bureau of Labor Statistics, 90 percent of barbers earn less than $43,000 annually.
The Pembroke Pines campus has since suspended admissions following the federal investigation.
Video of some of the misleading practices can be found here.