Tags: Barack Obama | Education | Obama | University of Phoenix | Sale | College | Questioned

Politico: Frm. Obama Officials' Deal to Buy For-Profit College Questioned

Image: Politico: Frm. Obama Officials' Deal to Buy For-Profit College Questioned
President Barack Obama with friend, Marty Nesbitt at Washington Wizard's game against the Chicago Bulls at Verizon Center in Washington D.C. on February 27, 2009. (Getty Images)

By    |   Wednesday, 29 Jun 2016 11:01 AM

Former Obama administration officials who plan to buy the University of Phoenix — the largest for-profit college in the U.S., even after leading efforts to crack down on profit-making schools — are now working behind the scenes to win congressional and regulatory approval for the deal, Politico reports.

The would-be buyers, a group that includes an investment firm led by President Barack Obama's close friend Marty Nesbitt, has deployed former Deputy Education Secretary Tony Miller, who led the charge to increase regulation over for-profit colleges, to win favor for the deal.

Critics cite the unseemly aspect of Nesbitt, Miller and others with administration ties using their connections to help move the acquisition forward when some of their past actions helped drive down the value of the school and others like it.

The University of Phoenix's stock dropped 75 percent in 2015 as Obama's Education Department targeted for-profit colleges, and its enrollment fell 38 percent in the last year's final quarter, according to CNN.

"The irony is not lost on us," one unidentified Republican congressional aide told Politico. "It's quite rich, when you have former Obama administration officials who used to denigrate for-profit education now profiting off it."

"I know it was the attacks that drove the stock price down," Sen. John McCain, R-Ariz., said. "It's very clear."

Politico noted that the school's shares closed at over $86 on the day in 2009 when Obama was inaugurated for his first term, and now trade around $9. Miller served as the administration's top official in pressing for reforms at for-profit schools.

McCain previously criticized the Department of Defense for temporarily banning University of Phoenix recruiters from military bases. The Pentagon alleged that the university had misused military seals and trademarks, and conducted activities on bases without permission.

Veterans are one of the school's largest demographics: over 45,000 GI Bill recipients enrolled at the university last year, at a taxpayer cost of $290 million, Politico said.

"For too long and too often, the private education industry has been characterized by inadequate student outcomes, overly aggressive marketing practices, and poor compliance. This doesn't need to be the case," Miller said in a statement in, CNN reported in February.

The school, currently under investigation in Florida and Massachusetts, has warned that the deal is vital to its continued survival.

While declining to comment to Politico in response to specific questions, Miller and others said in a statement: "We expect the Department to evaluate this proposed transaction on the merits. The parties have engaged in the formal acquisition review process through regular order."

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Former Obama administration officials who plan to buy the University of Phoenix - the largest for-profit college in the U.S., even after leading efforts to crack down on profit-making schools - are now working behind the scenes to win congressional and regulatory approval...
Obama, University of Phoenix, Sale, College, Questioned
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2016-01-29
Wednesday, 29 Jun 2016 11:01 AM
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