Sacramento, California - California Attorney General Xavier Becerra Thursday urged the Veterans Administration (VA) to preserve a policy that protects veterans from receiving biased advice when making decisions about their education. Currently, VA employees are subject to stringent rules that govern their relationships with predatory for-profit colleges, which have a long history of exploiting veterans. But, on September 14, the VA proposed a broad waiver to those rules, which would have allowed VA employees to receive payments and gifts from for-profit colleges. Earlier this week, the VA reversed course and withdrew the proposed waiver.
“We must remain vigilant. Time and again, President Trump has favored for-profit colleges that share the same unsavory business practices which forced him to settle lawsuits against his now-defunct for-profit Trump University for $25 million,” said Attorney General Becerra. “Our nation’s veterans deserve advice that is in their best interest, not that of predatory for-profit colleges that often prey on GI bill benefits. The VA's disgraceful attempt to unravel conflicts-of-interest protections for veterans came too close for comfort. I call on the Veterans Administration to respect and follow the law and protect our nation’s brave men and women against conflicts of interest by VA employees.”
On September 14, 2017, the Veterans Administration published a proposal to exempt all VA employees from the conflict of interest provisions of 38 U.S.C. 3683, a federal law that prohibits VA employees from owning any interest in, or receiving wages, salary, dividends, profits, gratuities, or services, from any for-profit school that enrolls veterans under the GI Bill. The now-withdrawn proposal would have dismantled much-needed protections against VA employee conflicts of interests concerning for-profit colleges. For-profit colleges market heavily toward veterans to take advantage of GI Bill benefits—and many leave those veterans who enroll with little chance of acquiring beneficial education leading to employment. The VA is charged with overseeing the GI Bill program and the schools that participate in it.
The California Attorney General’s Office has led the charge against predatory for-profit colleges, bringing an enforcement action that resulted in the permanent closure of all Corinthian Colleges campuses in California, a $1.1 billion default judgment, and findings of fact that give tens of thousands of former Corinthian students the right to federal student loan relief. In recent months the Office has continued those efforts: working as part of a coalition of 19 attorneys general to sue the Department of Education for unlawfully delaying the implementation of the Borrower Defense Regulations, which are aimed at protecting students from deceptive practices and fraud; announcing a settlement with Aequitas Capital Management providing more than $51 million in debt relief for Californians who attended schools owned by Corinthian; and calling on the Secretary of Education to provide promised loan relief to former Corinthian students.