Our society is continuing to wake up to the realities of systemic racism across all areas of society, including in higher education.
There is no question that one of the greatest contributors to racial inequities in our higher education system is the predatory for-profit college industry.
In fact, the debt associated with for-profit colleges is not only predatory, but racist.
The Project on Predatory Lending represents over one million former students defrauded by for-profit colleges. Their personal testimonies leave no doubt that this is an industry that systematically targets prospective Black and Latinx students, encourages them to take out federal student loans, and leaves students with a worthless degree and debt that they are unable to repay.
This is not a new development. The Consumer Financial Protection Bureau, the Securities and Exchange Commission, multiple state attorneys general, and numerous private actions have documented the industry’s lawless behavior.
At this time of reckoning, we must act to stop the racist tactics used to exploit the promise of higher education to another generation of Black and Latinx Americans.
Perpetuating Racial Inequality Under the Guise of Higher Education
These data points suggest that, in the aggregate, participation in higher education by African Americans is actually entrenching, rather than erasing, existing patterns of inequality that are the result of longstanding racism in the United States. The for-profit college industry is an important piece of this problem. It is as predatory as any payday or subprime lender, and is disproportionately responsible for racial disparities in education debt.
African Americans and other people of color are disproportionately enrolled in for-profit colleges. Black and Latino students make up less than one third of all college students, but represent nearly half of all those attending for-profit institutions. In 2015, more than half of all African American college students were low income (qualified for Pell grants). A student receiving a Pell grant is three times more likely to attend a for-profit college than someone not qualifying for such aid.
Outcomes across the board are extremely bad for this sector. Less than one in five students who enroll in a for-profit school will ever graduate. Less than a quarter of the money for-profit students borrow to pay for their education actually goes to their education. The rest goes to slick marketing and advertising, executive compensation, and shareholder profit. And studies show that those who do graduate from for-profit colleges do worse in the labor market than those with only a high school education.
Department of Education statistics show that close to 70% of African Americans who borrow to attend a for-profit college default on their loans within ten years. Because the industry targets its worthless products in explicitly racial terms, the debt associated with for-profit colleges is not only predatory, it’s racist.
For-Profit College Industry Spin
This predatory industry compounds the effects of the entrenched, systemic racism that has unfairly disadvantaged some while advantaging others. It closes the path to the middle class for thousands of African-American students simply trying to do what we are all told to do, which is to pursue higher education.
The industry also hides behind racial tropes in order to oppose—and often, defeat—any attempt to regulate its predatory conduct. For example, the industry encouraged member schools to attack the “gainful employment” regulation as “academic redlining.” It consistently elides the distinction between historically black colleges and universities and so-called “minority serving institutions.” The former are authentic cornerstones of the African-American community, forged at a time when higher education was legally denied to people on the basis of race, and continuing today as important forces for education and racial justice. The latter are profit-seeking corporations targeting people on the basis of race.
SUING FLORIDA CAREER COLLEGE
FOR TARGETING BLACK STUDENTS
Our lawsuit, Britt v. Florida Career College (FCC), shows how one for-profit college uses racially targeted advertising to peddle a false image of success to people of color, and uses predatory recruiting practices to encourage Black students to enroll in its fraudulent programs. The school promotes images of success and opportunity, even though only one in seventeen FCC programs led to gainful employment under the federal measure, and the company saddles students with debt they cannot hope to repay.
This is not only racist and wrong, it’s illegal.
A clear and growing threat
History shows us that for-profit colleges don’t wind down during economic crises, they thrive.
During the 2008 mortgage crisis, for-profit colleges saw their enrollments triple. When more people are out of work, for-profit colleges capitalize on their desperation to obtain training and find new employment.
There is already evidence that many for-profit colleges are ramping up their marketing, and targeting recently-unemployed people during the COVID-19 crisis.
A lawsuit asserting that Florida Career College targets students based on race, focusing its predatory marketing and deceptive recruitment practices on Black students, exacerbating the racial wealth gap.
Tiffeny Anderson, Dianna Bond, Veronica Boyd, Crystal Larkin, Sharonda Nixon, Barbara Turner, and Shirley Washington v. Virginia College
A lawsuit asserting that Virginia College engaged in “reverse redlining” in violation of the Equal Credit Opportunity Act by targeting African Americans.
Lawyers' Committee for Civil Rights Under Law, Mississippi Center for Justice, North Carolina Justice Center, Project on Predatory Student Lending, Southern Poverty Law Center
Letter to Senators Doug Jones, Elizabeth Warren, Kamala Harris, and Catherine Cortez Masto proposing reform to address inequities in higher education.
"Despite the claims that for-profit colleges serve an unmet need, are more nimble than stodgy traditional colleges, and increase access to poor and minority students, for-profit colleges target and thrive off of inequality."
"Black Americans who recently graduated college owe close to twice as much on their student loans as whites, a racial gap that has climbed nearly 14-fold over the past 15 years."
Unequal Burden: Black Borrowers and the Student Loan Debt Crisis | NYC Consumer and Worker Protection
In New York City, data has shown that Black New Yorkers have suffered disproportionately from COVID-19: higher rates of infection; higher rates of death; higher risk of income and job loss relative to other New Yorkers. National data shows the same disproportionate impact.
September 9, 2019
The System is Rigged: Student Debt and the Racial Wealth Gap | Roosevelt Institute
Today, a new report co-released by Demos, The Century Foundation, and The Roosevelt Institute, Bridging Progressive Policy Debates: How Student Debt and the Racial Wealth Gap Reinforce Each Other, explores the connections between America’s persistent racial wealth gap and our crippling $1.6 trillion student debt crisis.
State of Higher Education for Black Californians | College Opportunity
The California Dream envisions a place of new beginnings where hard work is rewarded, and opportunity and good fortune are available to anyone who seeks it. This dream is threatened, as is our collective future as Californians, when its promise is only achievable by a few or when a Californian’s ZIP code, race/ethnicity, gender, or the amount of money in their bank account make that dream an illusion.
May 8, 2020
Students Call College That Got Millions In Coronavirus Relief 'A Sham' | NPR
A for-profit college received millions of dollars from the federal government to help low-income students whose lives have been upended by the coronavirus outbreak, but that same school, Florida Career College (FCC), is also accused of defrauding students.
April 30, 2020
For-Profit College Set To Collect $17 Million In Federal Stimulus Cash Is Sued For Predatory Practices | Forbes
Florida Career College, a for-profit two-year vocational school, received $17 million in federal coronavirus relief money. It was one of dozens of for-profits slated to receive a total of $1.1 billion in grants included in the $14 billion Congress set aside for institutions of higher education in the CARES Act.
February 24, 2019
California's Black Students Lag in College Completion Despite Some Gains | The Mercury News
Black students in California have shown progress in enrolling and completing college in recent years but still lag behind other racial and ethnic groups.
Focused on Targeted Advertising, Not Education
Public records indicate Corinthian Colleges spent over $600,000 placing ads on BET in a two-week period.
Tell Us What You Know
Do you know about discrimination happening in the for-profit college sector?