New protections for students at for-profit schools

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by BYRON HARRIS

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WFAA

Posted on June 4, 2011 at 10:00 PM

Updated Saturday, Jun 4 at 10:31 PM

NEWS 8 INVESTIGATES

For the past year, News 8 has been investigating problems in the for-profit school industry in North Texas.

Now the U.S. Department of Education has announced new regulations designed to protect students from ineffective career college programs.

Jyoti Tanmar owes nearly $20,000 for pharmacy technician training she recieved at Everest College in Arlington. The college told the State of Texas that Tanmar and 287 other students were gainfully employed.

But last year, News 8 revealed the employment records were falsified.

"Everest never got me a job," Tanmar said.

The U.S. Department of Education now says the way to measure if a student is gainfully employed is how well they are paying back their student loans.

Using the new criteria, if a graduate's loan payments are:

  • more than 12 per cent of his total income, or
  • more than 30 percent of his discretionary income, or
  • if more than 65 percent of graduates aren't repaying their loans

...the school could ultimately lose federal funding.

Critics of the for-profit schools industry say the new regulations are modest. The institutions can't be punished under the new rules until 2015.

Hearings begin next week in Washington aimed at stricter regulations.

E-mail bharris@wfaa.com

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