Essentially that means that the for-profit schools will be barred from recruiting on military bases, and veterans won’t be able to use the money they receive from the department’s tuition assistant program for education at any of the University of Phoenix branches. In a letter today to VA Secretary Robert A. McDonald, he wrote that the VA should “take appropriate action to protect veterans and federal taxpayer dollars under the VA’s jurisdiction”.
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The letter references the school’s past misuse of official military seals and trademarks, as well as its failure to give notice to the proper officials before going on military bases.
“When you walk in, there’s four or five fliers and the biggest logo on all those fliers is the University of Phoenix”, Iraq war vet Ryan Holleran told the CIR.
Although thousands of veterans use financial aid from the Department of Defense, the University of Phoenix says that money only accounts for 1% of its net revenue.
“University representatives had been working closely with DoD leaders and we all expected a different response from DoD”, Slottow said in comments provided to Business Insider. It is troubling that the DoD has used requests for information from other governmental agencies as grounds for placing the University’s DoD MOU in a probationary status.
The new prohibition on military tuition assistance to the university only applies to those now in the armed forces, and only affects new students, so it will not affect the 4,000 current beneficiaries.
Durbin said University of Phoenix students owe more in cumulative student debt than any institution of higher education in America. However, any students that are now using the DoD’s benefits and are enrolled in classes are allowed to continue their education. No school among the 10 most popular TA institutions posted a better course completion rate and only one school among the top 20 did so.
Veterans service organizations have expressed mixed opinions about the approach.
Federal lawmakers and student advocates argue that policy has incentivized for-profit colleges to target active-duty military and veterans to in order to comply with the rule.
The college is also now under investigation by the Federal Trade Commission about whether it used deceptive marketing tactics to recruit students. The Department of Justice and the Department of Education are reportedly coordinating ongoing investigations.
“There’s a whole slew of schools that have been under investigation….”
The University of Phoenix has persistently denied doing anything unethical.
For-profit critics, meanwhile, hailed the move. Dick Durbin, the Illinois Democrat who for years has led the charge against for-profits, said in a statement. Hutton declined to comment about whether his agency is in the midst of an investigation of the University of Phoenix or is planning to launch one.
According to a study by the Center of Investigative Reporting (CIR), the University of Phoenix received $345 million in GI Bill money a year ago and $1.2 billion since 2009.
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The DoD’s ruling has deep implications outside the military too.
