As US investigators close in on for-profit university financing scams, GOP presidential hopeful Mitt Romney publicly heaped praise on a buddy's for-profit college: Full Sail University.
For-profit colleges have been criticized for targeting low-income students because they qualify for large federal loans. But students who enroll are less likely to graduate with a meaningful credential and eight times more likely to default on the loan.
Full Sail University offers a $81,000 video game art program that graduates only 14%s of its students on time and 38% overall. Students carried a median debt load of nearly $59,000 in federal and private loans in 2008.
None of this bothered Romney who TWICE publicly praised Full Sail as a solution to higher education costs.
According to the NYT, Romney forgot to mention that the for-profit college's chief executive, Bill Heavener, is a major campaign donor and a co-chairman of his state fund-raising team in Florida.
Mr. Heavener has committed his own resources to the cause. He and his wife have each given the maximum $2,500 to the campaign, and he gave $45,000 to Restore Our Future, a “super PAC” run by former Romney aides to bolster his campaign. The chairman of the private equity fund that owns Full Sail University — C. Kevin Landry of TA Associates — gave $40,000 to Restore Our Future, records show.
For- profit college which derive as much as 90% of revenues from taxpayer-financed federal aid, have been accused of working to delay student loan defaults to maintain their eligibility for federal aid.
The United States Senate has conducted hearings into the business practices at for-profit colleges, where student loan default rates are about double those at public universities, and three times the rates at private nonprofit institutions. Internal e-mails from Apollo Group Inc., owner of the University of Phoenix and the biggest U.S. for-profit college, released at the hearing today suggest less than half of student loan defaults occur in the first three years of repayment.
It is in this context that Republican presidential hopeful offers free advertising for his campaign donor's for-profit university.