June 7, 2018 update: In response to a FOIA request and litigation by The Century Foundation, the Department of Education is providing TCF with documents related to the department’s “partial relief” approach to borrower defense complaints (currently suspended). TCF is making the documents publicly available here

The Century Foundation (TCF) has obtained updated data, from early March, about “borrower defense” claims—applications for loan relief from students who maintain that they have been defrauded or misled by federally approved colleges and universities. The data were provided by the U.S. Department of Education in response to a FOIA request.

Compared to the data we analyzed in August 2017, the new data show an increase of 29 percent in these fraud claims, from 98,868 to at least 127,817 (a precise total cannot be determined from the format of the data provided by the department). As with the prior data, more than 98 percent of the complaints are regarding for-profit colleges, many which have been under law enforcement investigations or have since shut down.

The largest increase for any single school was for the online campus of DeVry University, which saw its borrower defense claims increase from 1,195 in August to 7,393 in the March data. The owner of DeVry, Adtalem Global Education, has proposed to sell the large online school to an investment firm that owns a small for-profit college in California. In a letter to regulators, consumer groups have raised questions about the sale, citing the borrower defense data.

Nearly all institutions categorized by the department as public or nonprofit have only a few, if any, fraud claims from former students. There are exceptions, however. The three nonprofit schools with the largest number of fraud claims are colleges that converted from for-profit several years ago but, evidence indicates, never actual shifted control from the owners to disinterested trustees.

Everglades College and its larger partner school Keiser University topped the nonprofits list with 92 claims. Everglades-Keiser was featured in the 2015 Century Foundation report, “The Covert For-Profit,” and the chancellor of the university chairs a federal advisory committee that held a hearing on the issue of bogus nonprofit conversions only last week. Wright Career College, which has closed, was second. Third was Remington Colleges, which, like Everglades-Keiser, was featured in the 2015 TCF report.

In filing borrower defense complaints, borrowers must declare, under penalty of perjury, that their school misled them or engaged in other misconduct—such as using false job placement rates, lies about credit transfer, or unrealized promises about the nature of the instructional program—that had a financial impact on the student. The department has not released details about these complaints and has ceased investigating unlawful practices described therein. But analyses of borrower defense complaints filed by over 2,000 students who attended ITT Tech and nearly 200 students who attended Wright Career College, provided by attorneys for those respective student groups, show consistent misrepresentations by for-profit and covert for-profit colleges about costs and debt, educational quality, and employment outcomes.

Despite clear evidence that some for-profit colleges have engaged in hard-sell recruiting tactics and made deceptive claims, Secretary of Education Betsy DeVos has been dismissive of the borrowers’ struggles, and her agency has ramped down its enforcement efforts even as it cut back on plans to assist defrauded borrowers. On Friday, a judge ordered the Department of Education to halt its implementation of a revised approach to paying students claims that involved cancelling only a portion of the former students’ loans.

The data in the table below represents total claims by company ownership. The borrower defense claims can relate to enrollment in any prior year and those details are not available, so for schools that recently changed ownership, the schools have been allocated to the prior owner. (For a list of college brand names associated with the larger corporate owners, see our November report.)

Total Borrower Defense Claims by Company Ownership

Corporation August 2017 March 2018 (minimum) Claim Increase Percent Increase Control
Corinthian Colleges 75343 84362 9019 12% For-Profit
ITT Educational Services 7348 10718 3370 46% For-Profit
Adtalem Global Education, Inc. 1909 8574 6665 349% For-Profit
Education Management Corporation 2248 3540 1292 57% For-Profit
Apollo Education Group 1372 3083 1711 125% For-Profit
American Career Institute 2892 2932 40 1% For-Profit
Career Education Corporation 1279 2415 1136 89% For-Profit
Alta Colleges, Inc. 462 1030 568 123% For-Profit
Graham Holdings, Inc. 473 891 418 88% For-Profit
Globe Education Network 372 834 462 124% For-Profit
InfiLaw Corporation 522 697 175 34% For-Profit
Bridgepoint Education Group 197 482 285 145% For-Profit
B&H Education, Inc. 140 299 159 114% For-Profit
Anthem Education Group 151 293 142 94% For-Profit
ATI Enterprises, Inc. 161 277 116 72% For-Profit
United Education Institute 115 219 104 90% For-Profit
Weston Educational, Inc. 87 191 104 120% For-Profit
Lincoln Educational Services Corporation 93 179 86 92% For-Profit
Star Career Academy, Inc. 72 142 70 97% For-Profit
Strayer Education, Inc. 64 138 74 116% For-Profit
Laureate Education, Inc. 56 126 70 125% For-Profit
Career Point College 53 125 72 136% For-Profit
Full Sail, LLC 60 116 56 93% For-Profit
Capella Education, Inc. 41 99 58 141% For-Profit
Education Corporation of America, Inc. 44 98 54 123% For-Profit
Medtech College, LLC 53 96 43 81% For-Profit
Grand Canyon Education 44 94 50 114% For-Profit
Everglades College, Inc. 34 92 58 171% Nonprofit (Conversion)
Education Affiliates, Inc. 61 86 25 41% For-Profit
International Career Development Center 41 86 45 110% For-Profit
Premier Education Group 48 83 35 73% For-Profit
Regency Corporation 40 82 42 105% For-Profit
Universal Technical Institute, Inc. 33 81 48 145% For-Profit
Wright Career College 44 76 32 73% Nonprofit (Conversion)
Remington Colleges, Inc. 33 75 42 127% Nonprofit (Conversion)
Drake Business School 36 71 35 97% For-Profit
La’ James International College, Inc. 30 71 41 137% For-Profit
Academy of Art University 39 69 30 77% For-Profit
Dade Medical College 34 67 33 97% For-Profit
Mountain State University 39 62 23 59% Nonprofit (closed)
Center for Excellence in Higher Education, Inc. 29 54 25 86% For-Profit
FastTrain 41 50 9 22% For-Profit