President Donald Trump’s administration plans to put a former dean of a for-profit college in charge of the Department of Education unit that investigates fraud in higher education.
Julian Schmoke Jr., a former dean at DeVry University and current community college administrator, is expected to head the Student Aid Enforcement Unit, according to a Politico report.
Who is Julian Schmoke?
Julian Schmoke is the executive director of campus operations at West Georgia Technical College, a two-year public institution. Previously, he worked at the for-profit DeVry University, where he was the associate program dean for the College of Engineering and Information Sciences from 2008 to 2012.
Now he reportedly has been tapped by the Trump administration to run the Student Aid Enforcement Unit, which was created by the Obama administration. It investigates allegations of illegal actions by institutions of higher learning.
According to an email obtained by Politico, A. Wayne Johnson, the head of the Federal Student Aid Office, made a number of appointments, including Schmoke.
Here’s what Johnson said about Schmoke in an internal email: “Julian possesses over 16 years of experience in higher education leadership with extensive knowledge in the development and implementation of strategies for achieving student success, higher education policy, and evaluation of academic programs.”
Not everyone is so sanguine about Schmoke’s appointment, however.
“It concerns me that someone associated with for-profit colleges in the past would be put in a position like this,” said Jay Fleischman, a consumer advocate and lawyer specializing in student loans.
Fleischman is especially concerned that DeVry, Schmoke’s former employer, is among the for-profit colleges that have been involved in settlements for the types of fraudulent practices he will now be in charge of investigating.
What is the Student Aid Enforcement Unit?
The Student Aid Enforcement Unit was formed by the Obama administration in 2016 to combat illegal practices by higher education institutions.
The practices the unit is expected to take aim at include inflating graduation rates and overstating job prospects, which take advantage of vulnerable students who might pay outsize costs based on promises of a better life.
The Student Aid Enforcement Unit consists of four divisions that focus on investigations, borrower defense related to Direct Loans, administrative actions, and compliance with campus security and crime disclosures.
“When Americans invest their time, money, and effort to gain new skills, they have a right to expect they’ll actually get an education that leads to a better life for them and their families,” said former Secretary of Education John B. King Jr. in a release related to the unit’s formation. “When that doesn’t happen, we all pay the price. So let me be clear: Schools looking to cheat students and taxpayers will be held accountable.”
DeVry University settlements
In 2016, DeVry University agreed to a $100 million settlement with the Federal Trade Commission. In February 2017, DeVry reached a settlement with the state of New York for more than $2.25 million. DeVry also settled with the state of Massachusetts for $455,000.
Much of the settlement money is expected to go toward refunding students and forgiving former students’ student loans. The settlements are mostly the result of misleading advertisements related to job placement.
The FTC lawsuit alleged that DeVry counted graduates as working in their field when they weren’t. One example: a rural mail carrier with a degree in technical management.
In the case of the state of Massachusetts, an investigation found that certain DeVry programs had job placement rates in their field as low as 52 percent within six months of graduating — not the 90 percent DeVry claimed.
In May 2017, with these settlements behind it, DeVry University moved to change its name and branding to Adtalem Global Education Inc.
Policing for-profit colleges
DeVry isn’t the only for-profit university caught up in the recent furor over allegations of deceptive practices.
The Obama administration cracked down on for-profit colleges, resulting in the reduction or withdrawal of federal aid to some of what the administration deemed to be the worst offenders. Many borrowers are looking for student loan forgiveness and other relief in the wake of closings.
“In light of DeVry’s past and the fact that some of these indiscretions happened while he was working at DeVry, it’s disappointing that Schmoke might be leading an office that is likely to investigate his former employer,” Fleischman said, “especially since he will now be playing a major part in deciding what happens with the claims of more than 1,800 former DeVry students who have filed complaints about the university.”
Although students and taxpayers deserve protection from colleges looking to cheat them, concerns exist about whether Schmoke is the man for the job given his past at DeVry.
For more information on the Department of Education and student loan developments, check out the following articles:
- New Federal Rules Help Students Get Forgiveness in Cases of Fraud
- Betsy DeVos Just Got Sued. The Decision Could Affect 68,000 Student Borrowers
- Betsy DeVos Rolls Back Obama-Era Student Loan Protections
- DeVos Announces Huge Overhaul of Federal Student Loan System
- 550,000 Borrowers Still Unsure if Department of Education Will Honor PSLF
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1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 6.97% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.30% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at email@example.com, or call 888-601-2801 for more information on ourstudent loan refinance product.
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2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown.
All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.28% effective October 10, 2018.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
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