In light of the ongoing case against Trump University, Sen. Elizabeth Warren (D-Mass.) and other Senate Democrats are calling on federal student loan regulators to step up efforts to protect consumers from educational programs that engage in fraud and deceptive marketing.
Recommended reading Trump’s Student Loans Forgiveness Plan.
In a letter sent Thursday to the heads of the Federal Trade Commission, Department of Veterans Affairs, Consumer Financial Protection Bureau, and Education Department, the lawmakers urge the agencies to create an online tool that alerts and warns potential students of companies posing as universities without a state license, charter or accreditation. They also asked the agencies to “enhance and prioritize” enforcement of federal consumer-protection laws that prohibit deceptive practices by businesses or “individuals who lend their names to sham outfits.” The senators are seeking a response by the end of August.
“It is more important than ever that we do everything possible to maintain the public’s trust in our institutions of higher learning and the quality of the education they provide,” the senators wrote. They have asked the agencies to “take proper and necessary steps to prevent the creation of additional Trump University-like entities that prey on the hopes, dreams, and aspirations of students and their families.”
VA calls attention to lawsuits against colleges on its GI Bill Comparison Tool, a website where members of the military can research colleges and universities. Education officials, meanwhile, have updated the College Scorecard to include warnings about schools that are poorly managing their finances. Still, there is no one-stop government website where prospective students can learn whether institutions are operating without a license or accreditation.
This request comes as former students of Trump University are suing the enterprise for bilking them out of thousands of dollars with the misleading advertisements that promised a path to millions by using Trump’s real estate investing techniques. In some cases, they paid upward of $34,00 for seminars that would assure success in real estate that new materialized.
In fact, Trump University was never licensed to operate as a school despite the name. This landed the institution in hot water with the state of New York. Though the company agreed to move its operations out of the state of New York, it continued to market itself as a university in New York. Intern New York General Eric Schneider man to file a lawsuit against the outfit for deceptive marketing. Trump, who is the presumptive Republican nominee has denied all of the allegations.
Senator Warren has been calling out Trump for his incendiary remarks and for being unqualified to lead the country. Trump has been the least hesitant in firing back to the senator. The use of Trump’s defunct university to press regulators for tougher enforcement of consumer-protection laws could be seen as another political attack on the presidential candidate. Warren has a long track record of fighting for tougher consumer protections in higher education, especially regarding for-profit colleges and universities engaging in abusive business practices.
Senator Warren was one of the first lawmakers to demand that the Education Department forgive the debt of thousands of students who attended Corinthian Colleges, the for-profit giant chain that collapsed two years ago. She also mounted a campaign to strip the Accrediting Council for Independent Colleges and Schools of the power to act as the gatekeeper between colleges and billions of dollars in federal financial aid.
However, this battle is nothing new. Democratic lawmakers, state attorney’s general, and student advocacy groups have railed against for-profit colleges for misleading consumers about their programs, aggressive marketing, steering people into high-cost loans, and providing dubious degrees. DeVry University, ITT Tech, and the University of Phoenix have been the center of state and federal investigations due to their predatory marketing practices.
Industry advocates have said that any rules or restrictions imposed on for-profit schools should be universally applied to all institutions of higher learning.