Report: For-profit Schools Likened to Subprime Mortgage Lenders: The embattled for-profit college sector took another hit Tuesday with the release of a new report that cites the industry for preying on low-income and minority students in a way that will ultimately lead to a financial catastrophe like the subprime mortgage collapse of 2008.
The report—produced by The Education Trust, a D.C.-based organization that works to address the nation’s achievement gap—essentially serves as a wake-up call for Congress and the federal government to advance with efforts to more heavily regulate the for-profit college sector. Many fear that GOP lawmakers, fresh off a victorious takeover of the U.S. House, may stifle or roll back such efforts.
“The developing showdown between for-profit colleges and the government is another example of how the aspirations of the underserved and the unfulfilled promise of the American Dream combine with lax regulation to make the rich, richer and the poor, poorer,” says the report, titled Subprime Opportunity: The Unfulfilled Promise of For-Profit Colleges and Universities.
