Full Measure: For-profit colleges allegedly prey on military members

    Full Measure - For-profit colleges and the G.I. Bill (11-1-15).

    Some for-profit colleges are allegedly preying on military troops; veterans with benefits and a desire to build a new life become targets.

    They've even been given a name by some college recruiters: cash cows.

    About 300 thousand vets get up to $21K a year in G.I. Bill money. In all, 1800 colleges - many of them for profits - have received more than $20 billion G.I. Bill tax dollars.

    With so many billions in the mix, it's easy to see why some colleges use high pressure and allegdly dishonest tactics. Now, taxpayers are about to be on the hook for alleged misconduct by the schools.

    As a U.S. Marine, Bryan Babcock fought on the front lines in Iraq including the Second Battle of Fallujah in 2004. His post-military plan: police work. He used his GI Bill money to pursue a criminal justice degree at the for-profit college ITT Tech.

    Attkisson: How did you hear about it?

    Babcock: I saw a commercial on TV. That kind of got me interested in them.

    Babcock says ITT promised that police agencies everywhere would accept the degree. The cost --$70,000-- would far exceed his GI Bill grant at the time, but ITT made it easy for Babcock to borrow. He says they even helped him fill out paperwork for student loans. Then, after his third year, he made a startling discovery.

    Babcock: We applied to 22 or 23 police departments.

    Attkisson: And what did they say?

    Babcock: All of them said that they did not recognize ITT's degrees or their credits.

    Attkisson: And what thoughts went through your head when you heard this?

    Babcock: I was angry that I'd spent all this money in student loans and it turns out that the degree, if I would have finished there, would have been pretty much worthless.

    It's a story told by thousands of vets who attended for-profit colleges where students are more likely to drop out, default on their loans, or graduate in dire debt without a useful degree.

    Of eight for-profits that get the most GI bill funds, seven have been targets of inquiries for possible violations including deceptive or misleading recruiting.

    Together, they received nearly a billion ($939,086,610 million) tax dollars over two school years.

    One of those companies is DeVry University where Chris Neiweem was hired as the school recruited vets under the new GI Bill.

    A veteran himself, Neiweem was assigned to "Team Camo" where he says managers urged the sales team to use high-pressure tactics on troops who sometimes weren't suited for college.

    "Working in the industry at that time truly reminded me of the film "Glengarry Glen Ross,'" he said.

    "There is this scene where a corporate sales manager is brought in to improve the performance of the sales floor - played by Alec Baldwin."

    In the scene, Baldwin says to a salesman "they're sitting out there waiting to give you their money, are you gonna take it?"

    "And that was similar at the company," said Neiweem.

    If "Team Camo" dared to let veterans suspend class while in combatlike those in the National GuardNeiweem says management called them on the carpet.

    Neiweem: The company didn't care. They just wanted to make sure that they stayed in their classes and so the university could continue to be paid and they would continue to be on the enrollments books.

    Attkisson: Even if they were in a combat zone that didn't make sense for them to try to go to college on the computer?

    Neiweem: Yes. Management's guiding wisdom was, to be frank, "get their ass in class."

    Neiweem showed Full Measure today's sales tactics at work.

    In a chat on DeVry's website, he asks about costs and benefits--but can't get direct answers.

    "I can have a representative from our military admissions team reach out to you," he said, reading the response of a recruiter.

    "It's fairly frustrating that I asked these questions and I can't get answers. Rather, they're trying to sort of tie me in and get me closer so they can work towards selling the school."

    DeVry officials declined an on camera interview but said "Devry has a long history of serving veterans and military personnel" dating back to the 1940's. And "[W]e offer quality academics and student services with flexibility to meet their busy schedules."

    Former Congressman Steve Gunderson leads the main national for-profit college trade group called the Association of Private Sector Colleges and Universities (APSCU).

    "If anybody has a bad outcome, and certainly if a veteran has a bad outcome, that's a problem and we want to solve that," he said

    He believes for-profits are under assault from opponents and competitors.

    Gunderson: I have never before seen a situation where a sector is the target of attacks for ideological reasons. I mean, there simply are good people who do not believe the private sector oughta be involved in the design and delivery of education.

    Attkisson: Fair enough, but is there any doubt in your mind that some schools have used unfair, unethical, or even dishonest tactics?

    Gunderson: There is no doubt in my mind that there are bad schools in every sector of higher education who have engaged in inappropriate conduct for various reasons whether it be athletics or whether it be admissions or it be something else.

    Gunderson said the industry is improving.

    A Government Accountability Office report found for-profits catering to military students actually beat public schools in one area: higher graduation rates.

    With billions flowing to for-profits under investigation, President Obama dispatched a warning at Ft. Stewart army base about any for profits that may be preying on the troops.

    "It's not right. They're trying to swindle and hoodwink you. They don't care about you; they care about the cash," he said.

    But as federal scrutiny surged, the industry has countered with Washington lobbyists and campaign cash.

    Since 2010, for-profit colleges have poured nearly $10 million ($9,906,512) into campaign contributions and spent $41 ($41,924,452) million on lobbying, according to the Center for Responsive Politics.

    Sen. Dick Durbin (D-Illinois): That's how you really win friends and influence people on Capitol Hill. The for-profit colleges and universities have friends in high places.

    Attkisson: That implies some members in congress, you think, are bought and paid for on this issue.

    Sen. Durbin: I would say this - they are influenced by it.

    Senator Durbin has pushed one bill after another to fight for-profit college fraud, only to see the bills get watered down and voted down.

    "If these schools that are enticing kids into loans for educations that are worthless had some 'skin in the game,' some responsibility for default, they'd think twice about it. But they don't. They could care less," he said.

    It turns out taxpayers have the most skin in the game.

    In June, the federal government said it will forgive loans for students at Corinthian College, putting taxpayers on the hook for up to $3.5 billion. Corinthian shut down in May amid fraud accusations, which the company denied. And the feds may wipe out loans at other problematic colleges.

    In May, the federal government charged Babcock's alma mater, ITT Tech, with fraud, alleging it concealed financial information from investors.

    ITT is fighting the charges, but declined our interview request.

    Gunderson says he doubts Babcock's ITT degree would have really been useless.

    "I am willing to say, that if he graduated, from an accredited criminal justice program, there are many police agencies that would hire him. Maybe not the one he wanted to go to, but there are amny that will, and evidence all across the country shows that" said Gunderson.

    Babcock gave up on the ITT degree and his dream of police work. Instead, he's focused on warning other vets, and working to pay down his $40 thousand student loan debt.

    "I think it's a shame that they prey on men and women that volunteered to protect this country. And that earned a benefit with their service, and then ITT and the other for-profit schools are just trying to take that," he said.

    The Defense Department recently banned the University of Phoenix from recruiting on military bases, alleging a pattern of violating policies designed to protect military students. Senator Durbin says ITT is now facing investigations by the Justice Department and 18 Attorneys General.

    "Full Measure with Sharyl Attkisson" airs on Sinclair Broadcast Group stations on Sunday mornings. Click here for specific air times in your region. Follow "Full Measure" on Twitter (@FullMeasureNews).

    News In Photos

      Loading ...