Kaplan Buys For-Profit College From Apollo

Kaplan Professional Education recently signed an agreement with Apollo Education Group to purchase the College for Financial Planning for an undisclosed amount.

CFFP offers financial education and training to students interested in becoming certified financial planners. Kaplan Professional Education is owned by Kaplan Inc.

"This opportunity is beneficial both to the College for Financial Planning and Kaplan and will help us continue providing the high standard of education in financial planning that we have offered for decades," said John Sears, president of the college, in a statement. "We are proud of the important role we play in supporting professional development in the financial services industry and this transaction brings together the resources and institutional experience of two of the most significant education providers in the sector."

The sale is expected to close next year and requires approval from CFFP's accreditor, the Higher Learning Commission.

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Inspector General: Resume Processing Borrower-Defense Claims

The Department of Education's inspector general said Monday that review of student loan relief applications known as borrower-defense claims should resume after months without a single ruling from the Trump administration.

The Office of Inspector General also recommended that the department establish a time frame for reviewing claims and either issuing a denial or discharging the loan.

Democrats seized on the report as evidence that the Department of Education under Secretary Betsy DeVos has harmed tens of thousands of student borrowers by halting review of the claims by students who allege they were defrauded or misled by their institutions.

"Now Secretary DeVos has absolutely no excuse -- it’s time to cancel these fraudulent loans," said Senator Elizabeth Warren, a Massachusetts Democrat, in a statement.

About 95,000 borrower-defense claims are pending review by the department, administration officials have said -- roughly 65 percent of those filed by former students of for-profit Corinthian Colleges institutions.

While Democrats and student advocates have repeatedly sought answers on the lack of progress, the department has said it is working to set up a process for adjudicating claims.

Department spokeswoman Liz Hill said the OIG report confirmed "the previous administration did not establish an adequate adjudication process for borrower-defense claims."

"The desire to avoid denying claims or adjudicating complicated claims left thousands of students in limbo," she said. "That’s why the department, under the leadership of Secretary DeVos, has been working diligently to put a process in place that provides a consistent and reliable way to adjudicate pending borrower-defense claims, provide fair relief to defrauded students, and also protect taxpayers."

The inspector general's report, though, found that Federal Student Aid's Borrower Defense Unit had clear criteria for review of claims, even though it recommended clearer documentation of legal memoranda used to justify discharges and establishing clear policies on review of unique claims, among other changes.

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DeVry traded to private small company

Once a large for-profit institution, DeVry is now being handed over to a company that runs a small college with 600 students. Experts see the move as a sign of the times.

DeVry Under New Ownership

Adtalem Global Education, the company that owns DeVry University, announced Monday that ownership of the for-profit institution would transfer to Cogswell Education LLC. The transfer deal also includes Keller Graduate School of Management.

The agreement would still need federal and accreditor approval before being finalized.

"I am thrilled for DeVry University and its students as it enters this new phase in its history," said Lisa Wardell, president and chief executive officer of Adtalem, in a news release. "Cogswell Education is the right partner to fuel DeVry's mission and commitment to its students, ensuring high-quality programs that help students achieve their career goals."

The agreement includes an "earn-out" for Adtalem based on DeVry's future performance over multiple years.

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Education Department Signals Possible Changes to Gainful-Employment Rule

In documents released this week ahead of a negotiated rulemaking session on the gainful employment rule, the Department of Education signaled potential limits to Obama era regulation that went into effect last year.

The gainful employment regulation was written to weed out poor-performing career education programs that produce too many graduates with debt they can't repay. To hold programs accountable, it ties access to federal student aid funds to performance on a debt-to-earnings metric.

For-profit colleges sued twice to block the rule, but it went into effect last year and the first set of full data for career programs subject to the rule was released in January. However, Education Secretary Betsy DeVos said in June that she would appoint a rulemaking panel to overhaul the rule, taking account of many of the complaints from colleges. 

Materials provided to negotiators ahead of the first rulemaking session next week signal an interest in applying the regulation in whole or in part to all higher ed programs. That fits the priorities of for-profit groups like Career Education Colleges and Universities. It also wouldn't be possible under current law without making gainful employment simply a transparency measure by removing accountability measures -- another question raised by the materials for negotiators.

Virginia Foxx, the Republican chair of the House Education and the Workforce committee, is a longtime critic of the rule. Legislation expected from her committee this week would prohibit future action on the gainful employment rule by the department, according to reporting by the Wall Street Journal. The legislation, a reauthorization of the Higher Education Act, will instead propose a new tool tracking program-level data on completion, earnings, and average debt, the Journal reported.

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Calif. Attorney General Sues For-Profit Ashford

California Attorney General Xavier Becerra on Wednesday announced a lawsuit against for-profit Ashford University and its parent company, Bridgepoint Education. 

Becerra alleges that Ashford made false promises and provided faulty information to students to persuade them to enroll. The lawsuit also alleges the institution used illegal debt collection practices while students struggled to pay their bills. 

"No school should ever steal the American Dream from its students but that is exactly what Ashford University did," Becerra said, in a news release. "Ashford University preyed on veterans and people of modest means. This for-profit college illegally misled students about their educational prospects and unfairly saddled them with debt." 

The suit further alleges that Ashford's salespeople made false and misleading statements to potential students about enrollment growth, how much financial aid students would get, how many prior academic credits would transfer into the school and Ashford's ability to prepare students for careers. Becerra also said Ashford misled investors and the public in filings with the U.S. Securities and Exchange Commission by inflating the percentage of working alumni who reported that their Ashford degree prepared them for their current jobs. 

The attorney general's office is seeking restitution for students, civil penalties and a permanent injunction prohibiting similar activities in the future from Ashford. 

The embattled for-profit institution recently suspended new enrollment of veteran students who receive the Post-9/11 GI Bill as part of a long-running dispute between Ashford, the U.S. Department of Veterans Affairs and an Iowa state regulator. 

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Report: For-Profit Looking to Sell 2 Law Schools

For-profit law school chain InfiLaw is looking to sell its two remaining law programs, The Wall Street Journal reported over the weekend.

Arizona Summit Law School was placed on probation in March by its accreditor, the American Bar Association. Florida Coastal School of Law, meanwhile, was warned by ABA in October that it was "significantly out of compliance" with accreditation standards.

A third InfiLaw program, Charlotte School of Law, shut down in August after it failed to win renewed access to Title IV federal aid programs and its state regulator rejected a request to extend its license to operate. The Obama administration had cut off Charlotte's access to Title IV funds last year after the ABA put the law school on probation.

The Journal reported that InfiLaw is in discussions with nonprofit law schools to take over operations of its two remaining programs, according to Donald E. Lively, the president of Arizona Summit.

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Democratic Senators Urge VA, Department of Defense to Protect Ashford Students

In separate letters to the Department of Defense and Department of Veterans Affairs Monday Tuesday, Democratic senators called for additional steps to protect student veterans and service members enrolled at Ashford University, which is slated to lose GI Bill eligibility within 60 days.

Ashford last week said it would suspend enrollment of new student veterans who receive Post-9/11 GI Bill benefits -- the latest development in a dispute between the for-profit and the VA. The agency told Ashford that Arizona regulators had not provided sufficient evidence of jurisdictional approval over its online programs. 

The VA said it would suspend Ashford's GI Bill eligibility within 60 days if corrective action was not taken. Although Ashford disagreed with the decision in a corporate filing, it agreed to voluntarily suspend enrollment of new student veterans. 

The senators urged Secretary of Veterans Affairs David Shulkin and Secretary of Defense James Mattis to warn GI Bill recipients and DOD Tuition Assistance recipients of Ashford's status and prohibit further enrollments. 

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Democrats Seek Full Relief for Defrauded Borrowers

Congressional Democrats called on Education Secretary Betsy DeVos Tuesday to grant full student loan relief to borrowers who were defrauded or misled by their colleges.

In a letter signed by 26 Senate and House lawmakers, the Democrats said they were concerned over reports that the Department of Education is considering granting partial relief to defrauded student loan borrowers. Officials at the department have had discussions about whether and how to grant partial relief to some borrowers based on the amount of harm they suffered.

DeVos in June suspended an Obama administration student loan protection regulation, known as borrower defense, that provided a new federal framework for processing loan relief claims. While the department has pursued a negotiated rule-making process to arrive at a new rule, it's said it will process thousands of pending borrower-defense claims under a 1995 regulation that used violation of state law as a basis for approving a claim.

The Democrats said using earnings data from the Social Security Administration to calculate harm could not be done unilaterally by the department. They asked DeVos, among other questions, to confirm whether such conversations are taking place and whether the department has been instructed by the White House or Department of Treasury to limit the budgetary impact of loan relief claims.

About 95,000 borrower defense claims are currently pending resolution, acting Under Secretary James Manning told panelists negotiating a new borrower-defense regulation Tuesday. About 65 percent of those claims were filed by former students of for-profit Corinthian Colleges institutions.

Many borrowers have waited for resolution on those claims for two years or more. Manning said in his comments to negotiators that the department will forgive interest that accrues on loans when a borrower-defense application takes more than a year to resolve. He also said that as it has worked to process claims, the department has found that some loans "fully or partially" fell outside the applicable statute of limitations in their state, making them ineligible for discharge.

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Gainful-Employment Negotiators Named

The Department of Education on Monday released the names of 16 negotiators and their alternates who will look to reach agreement on a new gainful-employment regulation.

An Obama administration regulation, the gainful-employment rule was written to hold career education programs accountable for producing too many graduates not making progress paying off their student loans.

The department released the first gainful-employment data in January, showing a wide disparity in performance between public and for-profit institutions. But in June Betsy DeVos said she would launch a negotiated rule-making process to overhaul the regulation.

The list of negotiators includes representatives of a wide mix of constituent groups, including two-year and four-year institutions, business and industry groups, consumer advocates, accreditors, for-profit colleges, and others. The panel's first negotiating session will run from Dec. 4-7.

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