NYC Consumer Agency Investigates For-Profits

New York City's Department of Consumer Affairs is investigating four for-profit colleges over concerns about students' dropout and loan-default rates, and the ways in which students are recruited in the first place, The New York Times reported.

The agency issued subpoenas in February to four local institutions: Berkeley College, Mandl School, New York Career Institute, and Technical Career Institutes. Department officials told the Times that the colleges were singled out for their high loan default rates and students' complaints about their recruiting practices – repeatedly calling people who request information online and pressuring potential applicants to commit themselves during their first visit to the campus, for example.

The subpoenas requested documentation on the institutions' recruiting procedures and job placement claims to determine whether the schools violated the city's consumer protection laws. While the Consumer Affairs Department holds no power over the schools' accreditation, it does have the authority to level fines or take schools to court to try to recover tuition money for students.

"What we are concerned about," said Julie Menin, the commissioner of consumer affairs, speaking about problems within the industry at large, "is that predatory, for-profit colleges are taking advantage of the ambition that so many New Yorkers with low incomes have for a better life, and cheating them out of their dreams and their money."

New York Career Institute said it was cooperating with the investigation. The three other colleges did not respond to the newspaper's requests for comment.


Related Links

The New York Times