For-profit Universities

Duhawks for better education

Matt Henick, Joe Rodrigues, Miles
McDonnell, and Nick Duffy
Overview
● For-Profit universities have been investigated recently for aggressive recruiting tactics that
exploit race, gender and economic inequality.
● Though these for-profit universities argue that they search for a student body that qualify for
the most amount of student aid.
● For-profit universities noticeably have higher prices for the same credentials offered at
nonprofit institutions.
● Could it be that since these students targeted for for-profit schools have a known higher
chance of dropping out before completing their degree leaving them with debt from these
expensive classes?
○ Digging into financials and statistics, it may come off as an intentional business plan.
Frontline Documentary
● In 2016, Frontline’s correspondent Martin Smith researched and
reported on the state of for-profit colleges in America
● The video focused on the University of Phoenix (owned by Apollo
Global Management, a private-equity firm) and Corinthians
College, Inc. (which at one point owned over 100 affiliated
campuses), two of the larger for-profit secondary education
companies in the U.S.
● For-profit colleges increased their enrollment and their
prominence following the downturn of the economy in 2008
Frontline Documentary
● Injustices
○ University of Phoenix
■ A former high-ranking executive explained that a for-profit
college administrator’s pay was limitless following the Great
Recession
○ University of Phoenix was not only company in the education sector
that prospered
○ Education stocks soared
○ For-profit colleges brought in $24billion in one year of federally
funded student aid
Frontline Documentary
● Injustices
○ With the success came an added pressure to keep producing
■ For-profit colleges recruited “an army of salesmen” to
aggressively recruit minority students
■ Recruiters were told to “dig deep...get to what’s bothering
them” in regards to prospective students
■ The problem was that students believed they were talking to
ethical admissions representatives
● Reality: recruiters were there to sell something
Frontline Documentary
● Response
○ 2011 - California’s Attorney General Office sued Corinthian
Colleges, Inc. for “a for-profit predatory scheme”
■ Mainly, the issue was that Corinthian misrepresented
their job placement rates
○ 2013 - Department of Education stopped paying federal funds
to Corinthian
○ 2015 - Corinthian shut down all of their colleges
■ Largest college shut down in history
Frontline Documentary
● Educational Credit Management Corporation (ECMC)
○ Bought out the Corinthian Colleges
■ Absorbed the loss
○ However, there are some issues here:
■ ECMC is a debt-collecting firm
● No experience in education sector
■ ECMC kept almost the entire compliance staff and most
of the administrators and teachers from the previous
administration
■ The deal was brokered by the Department of Education
○ Has anything changed?
Main CST Principles

● Participation on the business end of this dilemma.

● The Rights and Responsibilities on the side of the

students.

● Preferential Option for the Poor

CST Principles
● Participation on the business end of this dilemma
○ According to the CST principle of Participation, “The ultimate injustice is for a person or
group to be treated actively or abandoned passively as if they were non members of the
human race.”
○ While tackling this idea of whether for-profit educators do care about their education or
not we want to know if this sort of higher education is just a business plan to them or
not.
■ The fact that recruiters for for-profit colleges aggressively pressured prospective
students into taking out loans and convinced them that college would solve their
problems demonstrates that for-profit colleges knowingly participated in the
exploitation of hundreds of thousands of students
○ Whether they are impeding on the right of participation to their students.
CST Principles
● The Rights and Responsibilities on the side of the students
○ For-profit schools are using this higher education as a business scheme rather than to
better their students.
○ Under Rights and Responsibilities it states, “Every person has a fundamental right
to…education…to one another, to our families, and to the larger society.”
○ There could be a dilemma if these institutions are taking students legs out from under
them by lowering their standard of education and raising prices of these credits to profit
themselves.
CST Principles
● Preferential Option for the Poor
○ The Catholic Social Teaching of Preferential Option for the Poor focuses on the constant
need to be aware of those marginalized in society and to help them
○ One strong argument for for-profit colleges is that they cater to a population that is
often forgotten about: the minority population
○ However, do for-profit colleges place a majority of their students in their respective
fields post-graduation?

OR

○ Do for-profit colleges fail to place a majority of students in jobs that allow them to pay
off their student loans?
○ We want to know which question is closest to the truth
Financial Analysis Adtalem Global
Education
● “Empowering Our Students to Find Their Passion”
● ATGE
○ 8 Institutions
○ DeVry University (Largest Enrollment)
● Market Cap: 2.839B
● Net Income, 2015: $ 139.9M
● Net Income, 2016: $ (3.2M)
● Net Income, 2017: $ 122.3M
Resolution

● In order to resolve this issue there needs to be federal regulations for for-profit higher
education companies
● With these implemented into businesses it will be hard to work one's way around ethics and
make money rather than better educate their students
● This helps keep company owners loyal to CST and gives the community of students a better
education that they paid for and deserve.
Questions
?
Sources

https://www.npr.org/2017/03/27/521371034/how-for-profit-colleges-sell-risky-education-to-the-most-
vulnerable
1) Artifacts
https://www.pbs.org/wgbh/frontline/film/a-subprime-education/

http://investors.adtalem.com/CorporateProfile.aspx?iid=4183694

http://www.usccb.org/beliefs-and-teachings/what-we-believe/catholic-social-teaching/seven-themes-of-
catholic-social-teaching.cfm