Education

Defense Department now reviewing University of Phoenix recruiting

The Department of Defense said it is reviewing whether recruitment practices by the for-profit University of Phoenix, the country’s largest recipient of GI Bill funds, comply with federal law. Credit: Adithya Sambamurthy/Reveal

Pressure continues to mount on the Pentagon and the Department of Veterans Affairs amid widening concern about the quality of education at for-profit colleges and unaccredited institutions, which together have siphoned billions of dollars in taxpayer-supported benefits for veterans and military personnel.

The Defense Department confirmed this week that it is reviewing whether recruitment practices by the University of Phoenix, the country’s largest benefactor of GI Bill funds, comply with federal law.

Spurred by investigations by Reveal, members of Congress are asking the Pentagon and VA to do more to protect taxpayer money – and defend veterans and military personnel from predatory recruiting and subpar education.

Much of the concern centers on the University of Phoenix, which Reveal found has paid the military for exclusive access to bases, held recruitment events disguised as résumé workshops and included military insignias without the required permission on custom-engraved “challenge coins” handed out by recruiters.

In a speech Tuesday on the Senate floor, Sen. Dick Durbin, a Democrat from Illinois, credited Reveal for exposing what he called dubious marketing practices.

“The tide is turning against the for-profit colleges and universities,” Durbin said. “The question is whether this Senate, this Congress, this government will step up once and for all and defend those young men and women who are wasting their time and money and taxpayer dollars – and, in many cases, GI bill benefits – on these worthless for-profit schools.”

In an email, spokesman Maj. Ben Sakrisson said the Pentagon “takes the allegations very seriously and is conducting a review to ensure that the University of Phoenix is compliant with the Department of Defense Education Partnership Memorandum of Understanding.”

Since 2009, the school has reaped more than $1.2 billion in GI Bill money. Last year alone, it received $345 million to educate Iraq and Afghanistan veterans, along with $20 million in tuition assistance from the Pentagon.

“If a non-compliance issue is found, DoD will take the appropriate action as outlined in the MOU,” Sakrisson wrote in the email.

Contacted for a response, retired Maj. Gen. James “Spider” Marks, a University of Phoenix dean, said, “We’ve responded to that,” before promising to call back and ending the call. He did not call back or respond to subsequent calls.

Ryan Rauzon of the institution’s public relations staff asked for written questions, then said he would not answer them because Reveal’s past reporting “left us unconvinced that fair, balanced, fact-based reporting that allows us to tell our side of the story (is) likely to happen here.”

Veterans groups welcomed the inquiry and said they hope the military will work aggressively to rein in schools that they say prey on veterans and military personnel to gain access to taxpayer money.

“I hope they are conducting an aggressive review to protect and defend the integrity and promise of the GI Bill and other federal education programs for veterans and service members,” said Walter Ochinko, policy director of Veterans Education Success, a Washington-based advocacy group.

If military investigators “brush off” the allegations, he said, “there will be a firestorm on Capitol Hill and among veterans groups.”

Meanwhile, a bipartisan group of U.S. senators on Wednesday introduced legislation to prevent unaccredited schools from receiving GI Bill money, arguing that such schools do little to help veterans gain meaningful employment.

Reveal found 2,000 institutions that do not meet minimum federal requirements for other government funds have received more than $260 million in GI Bill money. Among those cashing in on the trade school loophole were a sex school in San Francisco that teaches masturbation and an Oklahoma Bible school whose president once declared that “50 to 60 percent of homosexuals are infected with intestinal parasites.”

In a statement, Sen. Richard Blumenthal, D-Conn., one of the sponsors of the bipartisan bill, said: “This bill protects veterans from slick pitches that lure them into squandering GI Bill benefits on worthless degrees from unaccredited education programs – helping them pursue legitimate education and employment opportunities.” Blumenthal is the ranking member of the Senate Committee on Veterans’ Affairs.

That legislation is the latest on Capitol Hill intended to prevent unscrupulous institutions from raiding the GI Bill, first established in 1944 to provide World War II veterans with unemployment benefits, tuition assistance and help obtaining home loans.

The program was expanded in 2008 to give post-9/11 veterans broad educational benefits. As a result, the government largesse represented by the GI Bill has become a financial bonanza for schools.

Since 2009, the revamped GI Bill has disbursed more than $53.6 billion for tuition, housing and books, according to VA spokeswoman Meagan Lutz.

Following Reveal’s investigation, Durbin urged Defense Secretary Ash Carter to launch an inquiry and suspend taxpayer-supported tuition payments to the University of Phoenix until an investigation could be completed. The senator also sought to ban the college from military bases.

Last week, 12 other senators joined Durbin in calling on the Pentagon to make public any state and federal inquiries being conducted against schools suspected of predatory practices, saying that information should be readily available on military websites.

Doing so presumably would make veterans and military personnel aware of any ongoing investigations into the University of Phoenix, whose parent company, Apollo Education Group, also is under investigation by the Federal Trade Commission.

As disclosed in a July 29 filing with the Securities and Exchange Commission, that probe centers on whether the company engaged “in deceptive or unfair acts or practices … in the advertising, marketing, or sale of secondary or postsecondary educational products or services or educational accreditation products or services.”

The SEC filing requires the company to hand over documents and other information dating back to Jan. 1, 2011, on “a broad spectrum of the business and practices” of the University of Phoenix, including its military recruitment methods.

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