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Federal Trade Commission steps up scrutiny of for-profit colleges

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The government's consumer watchdog -- the Federal Trade Commission -- tightens guidelines aimed at for-profits and tells student veterans to be cautious about the industry.

Higher Learning Commission's Manning to Retire

Sylvia Manning, president of the Higher Learning Commission of the North Central Association of Colleges and Schools, has announced that she plans to retire in July, she confirmed in an email to Inside Higher Ed. From her post as leader of the nation's largest regional accreditor, Manning has been a high-profile voice in the intensifying debate over accreditation. She is also widely credited with leading the commission's tougher approach on for-profit education. A search for her successor will be announced soon, Manning said.

For-Profit Association Hires Student Veteran Advocate

The Association of Private Sector Colleges and Universities, which is the for-profit sector's primary trade group, announced today that it has hired Michael Dakduk as vice president of military and veterans affairs. Dakduk has been executive director of Student Veterans of America, a nonprofit organization with more than 900 chapter affiliates.

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Strayer to Close 20 Campuses As Enrollment Falls

Strayer Education announced Thursday that it would close about 20 physical campuses, mostly in the Midwest, to cut costs in response to a 17 percent year-over-year enrollment drop that has sharply reduced its revenues. Strayer is the latest for-profit higher education provider (and among the last) to curtail its on-ground presence in the wake of the double whammy of a tough economy and increased regulatory oversight. The campus closures will affect about 5 percent of the company's roughly 50,000 students, Strayer said; those students will be encouraged to shift to the university's online programs, where most of them already study. (An email sent to students at the affected campuses said those who enrolled in spring courses would receive a $500 voucher toward the purchase of a new computer or mobile device.)

Strayer also said that it would cut its tuition price by about 20 percent effective in January.

Career Education Corp. Sells European Operations

Career Education Corporation, a major for-profit higher education chain, on Thursday announced the sale of its European education properties to a private equity firm. The company said it expects to receive $277 million in cash for the deal, which includes all of the for-profit's international schools division. Career Education's share price shot up 51 percent after it announced the news.

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For-Profit College CEO, Facing Criminal Charges, Quits

Ernesto Perez has resigned as CEO of Dade Medical College, days after it was revealed that he is facing criminal charges, The Miami Herald reported. Perez faces two counts of perjury, a misdemeanor, and one count of providing false information through a sworn statement -- all related to his failure to report past criminal arrests or convictions in government forms. Perez spent six months in jail after pleading no contest in 1990 to misdemeanor charges of batter and exposing his genitals to a child. The victim was a 15-year-old fan of the band in which Perez played at the time.

 

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Gainful Employment Session Rescheduled

The U.S. Department of Education has rescheduled the second session of its negotiations over possible new regulations to ensure that vocational programs are preparing students for gainful employment, according to a letter a department official sent to participants. The rule making session was postponed during the government shutdown. It is now scheduled for Nov. 18-20. Negotiators are seeking to find consensus on rules for vocational programs at community colleges and for-profit institutions.

For-Profit CEO Charged With Failing to Report Criminal Past

Ernesto Perez, the CEO of Dade Medical College, a Florida for-profit institution, has been charged with perjury and filing false information for failing on various records to indicate that he has a criminal past, The Miami Herald reported. Perez was asked about his background on forms he filled out when he was appointed to the Florida Commission on Independent Education, which oversees for-profit colleges in the state. Perez pleaded no contest, after a 1990 arrest, to misdemeanor charges of battery and exposing his genitals to a child. The Herald said that the victim was a 15-year-old fan of the heavy metal band in which Perez was then playing. Perez told the Herald that any forms that were not filled out completely were simply the result of an "honest mistake."

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Citing Shutdown, U.S. Cancels Gainful Employment Negotiating Session

The U.S. Education Department, citing the partial shutdown of the federal government, has canceled the second round of negotiations over regulations on vocational programs at community colleges and for-profit institutions.  

The department will reschedule the negotiated-rulemaking session when the government reopens, Lynn Mahaffie, the acting deputy assistant secretary for policy, planning and innovation, wrote in a letter on Friday to members of the rule making committee. The session was originally slated for October 21-23.

The panel is tasked with rewriting the "gainful employment" regulations that were thrown out by a federal judge earlier this year. The rules would cut off federal money flowing to career-training programs if they do not meet certain standards that measure their graduates’ earnings relative to the graduates’ student loan debt.

The Obama administration is proposing tighter standards that would apply to more vocational programs. At the first negotiating session last month, it appeared unlikely that negotiators would come to a consensus on the rules. Even if the committee doesn’t reach an agreement, the Education Department could still move forward with its own proposal. 

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Suspension of military education benefits forces some students to drop out

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The suspension of tuition assistance for active-duty service members during the shutdown is jeopardizing their academic progress and forcing some to withdraw from classes.

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