Student Loan Truth: Gainful Employment Not Guaranteed | Blog

February 25, 2022

“It’s overwhelming to contemplate the sheer number of people who could have been spared pain, suffering, and insurmountable debt with a functioning gainful employment rule.”

 

One topic that came up again and again during the Department of Education’s February Negotiated Rulemaking sessions was gainful employment of for-profit college graduates – or the lack thereof.

For-profit colleges are notorious for making false promises. They lure prospective students in with promises of an incredible education, a fulfilling career, and exemplary graduation rates, but the reality couldn’t be farther from the truth.

As our recent ITT report showcases, predatory schools are adept not only at deceiving students, but at skirting government oversight and accountability. At ITT, in order to give regulators the impression that its programs were leading students to jobs in their field of study – to gainful employment – the company went so far as to declare that an exotic dancer was working in their field of study. In another instance, one campus director created an entirely fictional company called Always Animal Clinic to say a graduate was employed in-field. Always Animal Clinic’s phone number was a direct line to ITT Tech.

These are just a couple examples out of many thousands. Several students joined the NegReg session last week during the public commentary period to share how they were misled. 

Sergio Solorza, a former University of Phoenix student, talked about how the school impacted his career, and the rest of his life:  

“They lied about their employment rates and promised me a career that could never be possible with their name on my diploma. After several years, I found out that University of Phoenix actually discontinued the master’s degree program I was enrolled in. Probably because they knew it didn’t work. I tried to apply to jobs and use my degree to start my career, like you’re supposed to do after college, but employers never took it seriously. They all knew that the University of Phoenix had a bad reputation, especially when a lot of military students from my area near the Ft. Bliss Army base in Texas had also complained of being defrauded by this school. My degree has only harmed my prospects at employment and my debt makes it almost impossible to move forward with my life.

It feels criminal that I have to pay for a degree that doesn’t exist and is not respected in any way.  University of Phoenix has forced me to put parts of my life on hold, the exact opposite of why I signed up in the first place. I need a way out and I’m not alone. The Department of Education has an opportunity to right the wrong this school has done to me and the thousands of students like me. We’ve all suffered at the hands of this fake college and it’s not right.”

For those who weren’t able to join the public commentary period, we made sure their voices were still heard. Project of Predatory Student Lending Director Eileen Connor spoke in front of the committee and used part of her time to share Adnan Medic’s ITT story. Here’s what he wanted to say:

My name is Adnan Medic and I’m here today to tell you about my time at ITT Technical Institute. I enrolled at ITT in 2008 with the intention of getting a Bachelors in Computer and Electronics Engineering. What I got instead was a scam. I’m speaking out today to warn regulators what happens if they allow people like me to take our federal loans to attend scam schools like ITT. ITT might be dead but I still have student loans and no way of paying them, and there are so many schools out there today doing the exact same thing to a new generation of students.

I was contacted by an ITT recruiter who used high-pressure sales tactics to press me into signing up for classes right then and there. They even charged me $100 for signing up! When I started attending classes, I quickly realized that the program and instructors weren’t at all qualified to be teachers and nothing I was taught was even relevant to the field of study I was pursuing. In the end, I was 1 credit short from graduating, but couldn’t even finish the program because the cost of attendance was impossible to maintain.

The worst part is that I wasted three years of my life for a degree that has done nothing but cause me hardship. Employers will not recognize ITT as a form of higher education, and my employment opportunities are limited to anyone willing to take a chance on me. I was promised gainful employment, but have yet to experience any of what I was promised.

I was scammed out of my education and over $40,000 has been garnished from my accounts. Like many students, I’ve submitted a borrower defense application and was denied with no explanation. I understand that ITT has been found guilty by courts and that some former students have received settlement money as a result. What about the rest of us? What do we have to do to get relief? We went to the same school as everyone else in that case – a school that has since gone bankrupt – but for some reason the majority of us are still expected to carry the burden of this debt. Where are the plans to refund students the money they’ve spent paying for a fraudulent education? And it’s not just me. This debt goes beyond just the lives of the students who attend the school. It’s a generational cost. I have two young kids and we are suffering financially because I can’t get out of this debt. At this rate, my children are going to end up paying the cost of a decision I shouldn’t have been given the option to make. It isn’t right, it isn’t fair, and the Department of Education has to do something about it.

These experiences make it abundantly clear that not only is the current borrower defense system broken, the Department of Education’s piecemeal approach to debt cancellation isn’t not enough. Defrauded student borrowers are owed bold action from the Department and accountability from the schools who build their business on deceiving them. Without a strong gainful employment rule keeping for-profit colleges accountable, more and more students will be defrauded, thus leaving them stuck with loans they can’t afford and relying on borrower defense to get the justice they’re owed. As Negotiated Rulemaking continues, it is the committee’s job to help make it impossible for future generations to suffer the same fate.