dlehnersauder

The Government Accountability Office released a report finding that 4 out of 15 for-profit colleges investigated are encouraging prospective students to “falsify their financial aid forms to qualify for federal aid.” Moreover, all 15 schools’ college personnel made “deceptive or otherwise questionable statements” to college applicants.

Applicants were encouraged to add non-existent dependants and misrepresent income and savings to qualify for student loans and grants. Why the deceit? Maybe because “89 percent or more of [the for-profit college’s] revenue [comes] from federal student aid.”[1] To garner students – because more students means more monetary gain – the colleges misrepresented facts such as salaries after graduation and the duration/cost of offered programs.

I may not be an expert on the subject of business ethics yet, but I am entirely convinced that encouraging prospective students to commit student loan fraud is unashamed, unethical company behaviour. Not to mention deceiving and recruiting students with falsified “facts” is a gross disservice to the higher education community.

Business ethics often takes a backseat to the pursuit of profits. But outright advocacy for fraud and deceitfulness should have no place in the business world, especially when that business is education.

Daniel Boissonneau-Lehner

http://business-ethics.com/2010/08/04/1404-for-profit-colleges-encouraged-fraud-and-used-deceptive-marketing-watchdog/