A.G. Underwood Leads Coalition Of 16 Attorneys General Opposing Secretary Devos' Proposal To Delay And Replace Rule Protecting Students Enrolled In Online Education

News from the New York Attorney General's Office 

FOR IMMEDIATE RELEASE
June 12, 2018

Attorney General’s Press Office / 212-416-8060
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A.G. UNDERWOOD LEADS COALITION OF 16 ATTORNEYS GENERAL OPPOSING SECRETARY DEVOS’ PROPOSAL TO DELAY AND REPLACE RULE PROTECTING STUDENTS ENROLLED IN ONLINE EDUCATION

Rollback of Program Integrity and Improvement Rule Would Strip Online Students of Critical Consumer Protections – Particularly Vital at For-Profit Schools

NEW YORK – New York Attorney General Barbara D. Underwood led a coalition of 16 Attorneys General that submitted comments to the Department of Education opposing Secretary Betsy DeVos’ proposal to delay and replace a federal regulation, the Program Integrity and Improvement Rule, which provides consumer protections for students enrolled in online college programs.  The Rule would increase the transparency and accountability of online programs offered in multiple states and would bolster state regulators’ ability to protect students enrolled in such programs.  

“Online education provides many benefits, but it can also carry risks for students and challenges for regulators,” said Attorney General Underwood. “The Program Integrity and Improvement Rule would ensure that students get the information they need to choose the right online school – and would also prevent schools from skirting critical state oversight.  Secretary DeVos’ decision to delay the Rule is yet another handout to special interests at the expense of students.”

The comment letter was signed by the Attorneys General of New York, Connecticut, Delaware, Hawaii, Illinois, Iowa, Maine, Maryland, Massachusetts, Minnesota, North Carolina, Oregon, Rhode Island, Virginia, Washington, and the District of Columbia.

The Rule, which was slated to go into effect on July 1, would strengthen states’ ability to protect online students by requiring schools that offer online programs in multiple states to obtain authorization to operate in each state where programs are offered, to the extent authorization is required under state law. The Rule would also provide crucial disclosures to online students, including a disclosure alerting students if a school determines that a program does not satisfy requirements for obtaining professional licensure in the students’ state. The Rule would also require schools to disclose refund policies and to alert students of adverse actions against the school by accreditors or state agencies. The delay of the Rule will deprive students of information that would help them choose appropriate programs and exercise their rights under state law.

The coalition’s comments to the Department explain that state oversight is especially important for one sector of the online education industry – for-profit schools. Investigations by the New York Attorney General’s office and other state attorneys general have revealed widespread misconduct by for-profit schools. The New York Attorney General’s office has recovered millions of dollars in restitution for students enrolled at for-profit colleges, including students of Career Education Corporation, DeVry University, and Education Management Corporation, as well as students who borrowed from Aequitas Capital Management to attend Corinthian College, Inc

The long list of actions against for-profit schools demonstrates that state oversight is critical to protect students. In addition, the Department’s continuing efforts to dismantle existing protections for students, such as the Department’s actions to delay and replace the Gainful Employment Rule and the Borrower Defense to Repayment Rule, have left students more vulnerable to schools’ misconduct and have made state oversight even more important. 

Finally, the coalition’s comments explain that the Department has failed to provide any justification for such a delay and replacement of the Rule. The Department has not cited any new facts or changed circumstances to justify a delay or reconsideration. Nothing in the Department’s proposal justifies delaying implementation of the Rule or opening the door to a full-blown reconsideration of the Rule.