Obama signs executive order protecting troops against predatory schools

President Obama today signed an executive order to provide consumer protections for members of the armed forces who are victimized by predatory practices of for-profit educational institutions. Schools have misled vets about the nature of educational benefits under the GI Bill, the amounts of debt they will incur if they finance their education through loans, and the appropriateness and usefulness of the schools' educational programs. The executive order is here, and the White House's statement explaining it is here.

In brief, what the order does is seek to require educational institutions that receive federal funding for education of service members and vets to adhere to "standards of excellence," including:

• providing prospective enrollees with a "Know Before You Owe" form telling them what their education will cost, what financial aid is available, and how much debt they will incur, and providing relevant information about student outcomes;
• requiring schools to tell service members and vets about the possible availability of federal aid before they sign up for costly private loans;
• ending fraudulent and aggressive marketing, misrepresentations, and incentive compensation to marketers;
• obtaining accreditation for new courses and programs before enrolling students in them;
• readmitting students who had to drop programs because of their military service obligations, and accommodating absences due to those obligations;
• adopting refund policies;
• providing educational plans and advisers for students.

The order contemplates implementing these changes through agreements with educational institutions that receive federal funds and other means, and provides for enhanced enforcement and compliance measures. And it directs the government to explore trademarking the term "GI Bill" to prevent its misuse by educational institutions to mislead students about their benefits.

Who could be against providing such basic consumer protections for service members and vets? The Association of Private Sector Colleges and Universities, that's who.  Through their president, former Republican congressman Steve Gunderson, they said they were "disappointed" with this "deeply unfortunate development." 

Comments

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