For-profit schools accused of taking advantage of veterans
PHOENIX — Veterans that used their G.I. Bill or other benefits to pay to attend for-profit colleges are fighting to get their money back.
Recently, the Biden administration announced plans to forgive more than $400 million in student loans.
Those borrowers attended for-profit schools like DeVry University, ITT Technical Institute, the Minnesota School of Business/Globe University, and Westwood College.
The estimated 16,000 students will receive debt forgiveness through a legal provision known as borrower defense.
However, former service members that used their G.I. Bill to pay for those same schools may not get their benefits restored.
“We didn’t know how to pay for college,” said Alphi Coleman, an Army veteran who joined the military to help pay for college.
“We didn’t have counselors in our school to tell us how that was going to happen so one way I knew was the military because they hung out in our cafeterias,” she said.
Coleman was a reservist working full-time for the military and used her G.I. Bill at the University of Phoenix which is based in Arizona.
“I had seen marketing that said there were three- and four-star generals that went to the University of Phoenix so I had this really high expectation of what I was going to receive and quickly found out that was not the case.”
Last week, Coleman testified to the Department of Education about the problems she faced as a student:
“I felt pressure to enroll from Phoenix recruiters who told me I needed to enroll quickly or I’d miss out, so I signed up right away. But when I arrived, I found out that new cohorts started every week. They also claimed their alumni went on to be executives and that the school had partnerships with government agencies and companies like Microsoft and AT&T, but I never saw these or any other job placement services.”
In 2019, the University of Phoenix agreed to a settlement with the FTC over their deceptive ads. As a result, the school had to pay $50 million in direct payments for some students and cancel an additional $141 million in balances students owed directly to the school.
“And I know the tactics they had been accused of doing is what they had done to me…so I was very hopeful that with that lawsuit I would get some kind of justice,” she said.
According to Coleman, she exhausted her G.I. Bill paying for school.
Meanwhile, groups like Veterans Education Success told ABC15 she’s not alone.
According to the nationwide nonprofit, thousands of veterans have used their educational benefits from the military at for-profit colleges.
“Unfortunately, the target has been on the back of veterans because of some unfortunate loopholes in federal law,” said Chris Madaio, the vice president of legal affairs and Veterans Education Success.
Madaio said it’s possible to have their benefits restored but it would probably take an act of Congress.
Still, he’s urging veterans impacted by for-profit schools to come forward.
“These benefits should not be allowed to be wasted by schools that are not teaching people what they need to teach them and are lying just to get those students in the door just to suck away their G.I. money,” he said.
Coleman said if he’s able to get her G.I. Bill back she would go to a more reputable college.
“I volunteered for this, yes but I volunteered based on the promise of opportunity and I feel like that was taken from me,” she said.
ABC15 reached out to the University of Phoenix for comment but has not yet heard back.