Dive Brief:
- Six U.S. Senators have written to President Barack Obama to express concern that ITT Educational Services Inc. and other for-profit college companies may follow the same path to financial oblivion as Corinthian Colleges Inc.
- The senators, all Democrats, present a list of questions for the Obama administration and the U.S. Department of Education about monitoring the financial stability of for-profit educators and the risk posed to students.
- The letter points out that Department of Education records indicate that more than 23 companies that enroll 4,000 or more students have financial integrity scores of failing or close-to-failing.
Dive Insight:
As is usual with these kinds of missives, it’s not clear what this letter accomplishes, besides publicizing somewhat well-worn concerns about how the Corinthian situation went down and the possible failures of other for-profit educators. ITT can’t be pleased that it was the only other college company, besides Corninthian, mentioned by name in the letter—another in a series of unfortunate events recently for ITT. The questions posed in the letter deal with the education department’s ability to determine the financial viability of for-profit educators, which it misjudged for Corinthian; how well those companies will stand up financially to the rash of lawsuits they face; and the risk to students, including veterans, as well as taxpayers and investors.