29 May 2015

Some Progress on the For-Profit School Scam (And a Review Questions for My Contracts II Students)

I've previously commented (here and here) on the failure of the efforts of the federal Department of Education to limit  the ability of for-profit "higher" education outfits to benefit from the largess of student loans. Schools like Corinthian Colleges pop up, run students through a certificate mill, students who pay with near-limitless access to federal student loans, and then fold up shop.

Now for some reasonably good news. According to the Washington Post, in ts latest round of rule-making, the Department of Education has succeeded in withstanding the first judicial round of opposition by the for-profit folks:
A federal judge on Wednesday denied a challenge to the Obama administration's rules limiting the amount of debt students can carry in career-training programs ... [In a 57-page decision, the judge observed that the federal government] "has a strong interest in insuring that students--who are, after all, the direct (and Congress's intended) beneficiaries of federal aid programs--attend schools that prepare them adequately for careers that are sufficient for them to repay their taxpayer-financed student loans."
A second case is pending in another court and, of course, there are likely to be appeals from this decision but for now it looks like progress is being made.

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For my Contracts II students who may read this post: Look up the case (Association of Proprietary Colleges v. Arne Duncan) and review the court's cursory third-party beneficiary analysis. Does it pass third-party-beneficiary-law muster?

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