Elizabeth Warren and Senate Democrats Press Regulators to Prevent Another Trump U

By Danielle Douglas-Gabriel, The Washington Post

15 July 16

en. Elizabeth Warren (D-Mass.) and other Senate Democrats are calling on federal regulators to step up efforts to protect consumers from educational programs that engage in fraud and deceptive marketing, in light of the ongoing case against Trump University.

In a letter sent Thursday to the heads of the Federal Trade Commission, Department of Veterans Affairs, Consumer Financial Protection Bureau and Education Department, the lawmakers urge the agencies to create an online tool that alerts and warns potential students of companies posing as universities without a state license, charter or accreditation. They also asked the agencies to “enhance and prioritize” enforcement of federal consumer-protection laws that prohibit deceptive practices by businesses or “individuals who lend their names to sham outfits.” The senators are seeking a response by the end of August.

VA calls attention to lawsuits against colleges on its GI Bill Comparison Tool, a website where members of the military can research colleges and universities. Education officials, meanwhile, have updated the College Scorecard to include warnings about schools that are poorly managing their finances. Still, there is no one-stop government website where prospective students can learn whether institutions are operating without a license or accreditation.

“It is more important than ever that we do everything possible to maintain the public’s trust in our institutions of higher learning and the quality of the education they provide,” the senators wrote. They have asked the agencies to “take proper and necessary steps to prevent the creation of additional Trump University-like entities that prey on the hopes, dreams and aspirations of students and their families.”

The request comes as former students of Donald Trump’s university are suing the enterprise for bilking them out of thousands of dollars with advertisements they say were misleading, promising a path to riches using the mogul’s real estate investing techniques. They claim that in some cases they paid upward of $34,000 for seminars assuring success in real estate that never materialized. Trump University was never licensed to operate as a school despite the name, which landed it in hot water with the state of New York. Though the company agreed to move its operations out of the state, it continued to market itself as a university in New York, leading New York Attorney General Eric Schneiderman to file a lawsuit against the outfit for deceptive marketing. Trump, the presumptive Republican presidential nominee, has vehemently denied all of the allegations.

Warren and Trump have been trading barbs for months, with the senator calling out Trump for his incendiary remarks and for being unqualified to lead the country. The use of Trump’s defunct university to press regulators for tougher enforcement of consumer-protection laws could be seen as another political attack on the presidential candidate. Warren, though, has a long track record of fighting for tougher consumer protections in higher education, especially regarding for-profit colleges and universities engaging in abusive business practices.

The senator was one of the first lawmakers to demand that the Education Department forgive the debt of thousands of students who attended the failing for-profit giant Corinthian Colleges after the chain collapsed two years ago. And she mounted a campaign to strip the Accrediting Council for Independent Colleges and Schools of the power to act as the gatekeeper between colleges and billions of dollars in federal financial aid for lax oversight of for-profit colleges.

Democratic lawmakers, state attorneys general and student advocacy groups have railed against for-profit colleges for misleading consumers about their programs, aggressive marketing, steering people into high-cost loans and providing dubious degrees. Some of the largest schools in the sector, including DeVry University, ITT Tech and the University of Phoenix, have been at the center of state and federal investigations into their marketing practices.

Industry advocates have decried the heightened scrutiny as a witch hunt that will ultimately hurt students who are underserved by traditional colleges and universities. They have said that any rules or restrictions imposed on for-profit schools should be universally applied to all institutions of higher learning.