(Source: By Michael Vasquez, The Miami Herald (MCT) – Federal GI Bill college benefits, like almost any student-aid program, can have tricky rules and regulations. And when students take their questions to the Internet, they frequently end up at GIBill.com.
But instead of offering impartial explanations and how-to tips, the site has functioned largely as a sales lead tool for a network of for-profit colleges. Attorneys general in 20 states — Florida included — accused the website of deliberately misleading tactics, as the site’s design could lead students to mistakenly think the site is either government-operated or endorsed by the military.
On Wednesday, Florida Attorney General Pam Bondi and her counterparts in other states announced a national settlement had been reached with QuinStreet, the California-based marketing firm that has operated GIBill.com and passed along veterans’ contact information to its for-profit college clients.
“Targeting veterans to profit from their GI Bill benefits is shameful,” Bondi said in a statement.
Under the terms of the settlement, QuinStreet must pay the 20 states a total of $2.5 million to settle their consumer protection claims. More importantly, the company must relinquish control of GIBill.com — the federal Department of Veterans Affairs will now operate the site.
Before the settlement, GIBill.com boasted a list of “eligible GI Bill schools” that was limited to the company’s clients, which were primarily for-profit colleges. Prospective students were not told about less expensive (and sometimes higher-quality) options such as community colleges. Veterans, relying on such incomplete information, could end up borrowing thousands of dollars in loans to attend a for-profit school when their GI Bill benefits would have enabled them to graduate debt-free from a public college.
On Wednesday, the GIBill.com list of “eligible” schools appeared to have vanished from the site, and it now included a prominent disclaimer that it was “a non-government privately sponsored website.”
QuinStreet released a statement Wednesday, saying it “does not engage in deceptive marketing practices and does not believe that its websites were misleading prior to the Agreement.”
Under federal law, for-profit colleges can only obtain a maximum of 90 percent of their revenues from federal student aid such as Pell grants and federal student loans. Some for-profit schools are constantly bumping up against the 90 percent cap, which places a premium of wooing students who satisfy the other 10 percent.
That 10 percent includes students who pay out-of-pocket, as well as veterans who pay with GI Bill benefits. Florida is home to the third highest number of veterans in the United States.
“If a for-profit college is able to recruit one veteran who is full GI money, they can recruit nine other students,” said Rich Williams, a federal higher education advocate for Florida PIRG, a consumer-advocacy group. Williams called the GI Bill website another example of why for-profits need tighter government oversight.
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©2012 The Miami Herald
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