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Consumers Union: Dept of Ed’s new rules for career college programs are first step, more reform needed

Thursday, October 30, 2014

Consumers Union: Dept of Ed’s new rules for career college programs are first step, more reform needed

WASHINGTON — The U.S. Department of Education today announced new rules for career-college programs to help protect students from being burdened with massive debts and help ensure they succeed after graduation.

Under the new regulations set to go into effect next summer, these for-profit career colleges would have to limit how much debt their students carry in relation to their yearly earnings after they graduate, or the schools risk having their federal student aid cut.  However, the rules only hold schools accountable for the debt levels of students who graduate – not those who drop out of the programs.

Suzanne Martindale, staff attorney for Consumers Union, said, “The rules are a first step toward addressing the problem of students who graduate from shoddy career-education programs and have little to show for it.  But clearly we need to do more to address career training programs with high dropout rates and the enormous debts carried by students who exit the programs.”

Pamela Banks, senior policy counsel for Consumers Union, said, “These rules raise standards for programs that have been heavily criticized for poor training and excessive costs.  Programs will have to be more transparent about graduation rates, student debts, and what former students are earning.  More needs to be done, and we’re going to keep pressing for further reforms to clean up this system.”

Media Contact: David Butler, 202-462-6262dbutler@consumer.org, or Michael McCauley, 415-902-9537mmccauley@consumer.org