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AG Nessel and 18 States File Lawsuit to Stop Federal Government's Illegal Elimination of Safeguards for College Students

LANSING – Michigan Attorney General Dana Nessel filed suit today with 18 other attorneys general to stop U.S. Education Secretary Betsy DeVos from eliminating critical protection for students considering enrolling in for-profit colleges and vocational schools.

For years, for-profit and vocational colleges engaged in fraudulent and abusive practices – including deceptive marketing – to convince students to enroll in questionable academic and training programs. Those practices left students across the country with piles of debt and no jobs to pay off that debt.

In 2014, the Department of Education issued a rule requiring the worst offending programs to warn students about the dangers of enrolling and ultimately the rule would have made those same programs ineligible to enroll students using federal financial aid. Known as the Gainful Employment Rule, the rule was named for the provision in the Higher Education Act which it enforced.

In a new rule set to take effect next week, the Department of Education has repealed the Gainful Employment Rule’s protections with the Repeal Rule, which is a license for for-profit colleges to take advantage of students looking to find educational programs to help advance their careers.

"I continue to be appalled by the Department of Education’s blatant disregard for the people these types of provisions and rules are supposed to protect,” said Nessel. “For-profit institutions should be setting up their students for success, not encouraging them to waste time and money on educational programs that won’t pay off with a better job. The federal government should want to ensure those institutions follow that guiding principle, but unfortunately this administration has adopted the common practice of rolling back protections for students who are striving for better opportunities.”

The 2014 rule worked to hold for-profit institutions accountable for the future success of their students, and reinforced a requirement in the Higher Education Act that all for-profit schools, all vocational schools, and non-degree programs at all other schools should “prepare students for gainful employment in a recognized occupation.”

The Repeal Rule, through which the Trump Administration has effectively announced it will not enforce a key part of the Higher Education Act, will injure Michigan and its taxpayers in several important ways, including making it more likely that Michigan residents will be duped into enrolling in programs, and taking on debt to finance those programs, when there is little chance that a good-paying job will be the result of those efforts and financial investment.

The states’ lawsuit says Education Secretary DeVos’ “decision to repeal the GE Rule without promulgating any alternative standard for implementing the Higher Education Act’s Gainful Employment provision is arbitrary, capricious, and contrary to law … and must be set aside.”

AG Nessel joins Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Illinois, Maryland, Massachusetts, Minnesota, New Jersey, New York, North Carolina, Oregon, Pennsylvania,  Rhode Island, Vermont, Virginia and Wisconsin in filing this lawsuit.

A copy of the filing is available here.