MELISSA BLOCK, Host:
The for-profit education industry has been exploding in size - doubling over the past decade and soaking up billions in federal student aid. Well, today a Senate committee heard evidence that some for-profits encourage students to lie so they'll qualify for those government dollars. NPR's Larry Abramson reports.
LARRY ABRAMSON: One pretend student asked to speak with a financial aid officer at ATI Career Training Center in Texas. The student practically begged the recruiter to give him some idea of how much he'll owe before signing up to pay $38,000 in tuition.
BLOCK: Unidentified Woman: Yeah, they're going to be able to do that when you get back there, but they're really not going to be able to sit down and go over everything with you if you're not willing to reserve your seat, 'cause there's...
ABRAMSON: Greg Kutz, who conducted the investigation for the Government Accountability Office, says some would-be students were told not to report financial assets on their application for federal aid.
GREG KUTZ: Other students were told to add bogus dependents to their federal aid form. One representative held up three fingers and told us specifically to add three bogus dependents to our federal aid form.
ABRAMSON: Kutz is referring some of the evidence for possible prosecution. For nearly two decades, it's been illegal to offer cash awards for boosting enrollment. But another witness at the hearing described a hothouse high-pressure atmosphere on his sales floor. Joshua Pruyn was a sales rep for Alta College in Denver, where he says bells would ring each time a student signed up.
JOSHUA PRUYN: Each representative had a quota of two students to enroll per week. Individual enrollments could mean paid time off or gift cards. And a successful year earned the top representatives an all-expenses-paid trip to Cancun.
ABRAMSON: The career college industry has sometimes claimed in the past that reports of abusive recruiting are the excesses of a few rogue individuals. But, today, Harris Miller of the Career College Association said he could not defend what he saw in those tapes.
HARRIS MILLER: There was no doubt that the government itself - federal government, the state government and the accrediting bodies, which in turn are approved by the federal government, are going to have to get more aggressive.
ABRAMSON: One lawmaker said the same spotlight should be trained on non-profit institutions. Republican Senator Richard Burr of North Carolina said in his state students at many for-profit schools are more likely to graduate with a degree than those at non-profit colleges.
RICHARD BURR: So I share this with my colleagues to let them know, the label of for-profit or the label for non-profit has no specific impact on graduation rates.
ABRAMSON: Larry Abramson, NPR News, Washington.
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