For-Profit Association Guides Members on Dealing With Vendors

October 12, 2011

The Association of Private Sector Colleges and Universities today released a guidance document for how its member institutions should work with third-party vendors. The release follows newly-strengthened federal rules for misrepresentations about degree programs, such as through online or television advertising for prospective students. Colleges can now be held accountable for virtually any false or misleading claim made by a third-party vendor. For-profits often hire outside companies to help in "lead generation" for students, which means the colleges face new vulnerability if those vendors run afoul of the rules.

However, officials at the association said the new guidance document was in the works before the new regulations were devised. Brian Moran, APSCU's interim CEO and president, said for-profits recognize their responsibility in being proactive about the "Wild West of Internet ads" generated by unethical companies. The guidelines show how members should exercise control in their relationships with outside marketing firms, and how they should monitor the advertisements themselves.

Moran said for-profits are not directly responsible for the actions of third-party vendors, but that "we are tarnished by the criticism" of shady advertising. He said the new rules create "enormous exposure" for APSCU's members. "There's lots of danger for the unaware."

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