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How Education Secretary Betsy DeVos is giving for-profit colleges a break

By in Press Enterprise on June 16, 2017

By Mark Muckenfuss

Few probably expected either President Donald Trump or his Secretary of Education Betsy DeVos to maintain the regulations put in place by the Obama Administration to hold for-profit colleges more responsible for their marketing practices and the effectiveness of their programs.

Trump, after all, ran his own for-profit university, which became the target of a class-action lawsuit. That lawsuit was eventually settled when Trump agreed to pay $25 million to former students who claimed they were deceived.

On Thursday, Department of Education officials said they are putting the brakes on the borrower defense regulation set to take effect July 1 and rolling back the existing gainful employment rule. DeVos said rule committees will work to improve both regulations.

“My first priority is to protect students,” she said in a statement.

Consumer advocate and education groups have largely criticized the move. California Attorney General Xavier Becerra, along with attorneys general from eight other states, has filed a motion to block the action.

“As the founder of the failed Trump University, President Trump knows well how some shady for-profit colleges and universities award useless degrees and prey on students’ and taxpayer’s money,” Becerra said in a news release. “If Secretary DeVos and the Trump Administration won’t protect students, then I will.”

One group in favor of DeVos’ move, is Career Education Colleges and Universities, an organization representing for-profit colleges.

In a statement, CEO Steve Gunderson criticized the Obama Administration for its “ ideological assault on our sector’s very existence. … Now we can correct that with a clean Borrower Defense regulation.”

Perhaps the biggest immediate relief for-profit colleges may feel is the avoidance of lawsuits. The borrower defense regulation, which would have set new guidelines for loan forgiveness for students who could show they were defrauded or misled by their colleges, also contained a provision outlawing binding arbitration clauses that […]    

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