In the world of unethical business practices, almost nothing is more despicable than preying on soldiers.
So everyone can be glad that Kentucky Attorney General Jack Conway and 19 of his fellow AGs have shut down deceptive marketing of for-profit colleges by a site called GIBill.com.
The California company, QuinStreet Inc., which operated the site, also agreed to pay $2.5 million as part of a settlement announced last week, though denying that it had engaged in deception.
While appearing to be run by the Department of Defense, GIBill.com gave the impression that vets could use their benefits only at the schools it listed and referred all contacts to the for-profits that were paying it.
Deceptive marketing is just a symptom of what should be a much larger concern. For-profit education companies are using veterans to funnel hundreds of millions of tax dollars from the U.S. Treasury to their investors and executives.
It's hard to say what the vets are getting in return.
In response to complaints that students of many for-profit schools are being saddled with huge education debts while receiving few if any marketable skills or transferable credits, the Obama administration imposed eligibility standards for schools to receive federal financial aid. But the standards are weak and enforcement is still three years away.
What the for-profit education chains are getting is rich.
For example, even though enrollment and new students have decreased, the Apollo Group Inc., owner of the University of Phoenix and the largest for-profit education chain, expects profits of $740 million this year.
Bloomberg News has reported the CEO of Strayer Education Inc. received a compensation package worth $41.9 million in 2010, including $40 million in stock. Taxpayers provide more than three-quarters of Strayer's revenue.
Beefed-up GI Bill education benefits, approved by Congress in 2008, were the least we could do for those who served multiple tours in Iraq and Afghanistan. The benefits also have been a windfall for for-profit schools.
Between 2006 and 2010, military education benefits received by 20 for-profit education companies climbed from $67 million to $521 million, a jump of 683 percent, according to Hollister Petraeus, the Consumer Financial Protection Bureau's point person for vets.
Enrolling vets provides a double bonus to the for-profits. Federal law restricts colleges to receiving no more than 90 percent of their revenue from federal student financial aid programs such as Pell Grants. But federal education benefits to veterans don't count against the 90 percent limit. So enrolling vets enables the for-profits to enroll more recipients of federal financial aid.
Congressional efforts to get a better handle on whether taxpayers are getting good value for the public dollars pouring into for-profit education have all but ended because the industry "owns every lobbyist in town," said U.S. Sen. Dick Durbin, D-Ill. at a Washington press conference last week at which the GIBill.com settlement was announced.
Congress's reluctance makes consumer protection efforts by the states even more vital, especially as the issue takes on a more partisan tone with GOP presidential hopeful Mitt Romney making a point to praise for-profit schools.
It's good the group of AGs working with Democrat Conway on for-profit education issues includes members of both parties.