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Column: Online for-profit colleges exploit students

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While the Internet is full of scams and misinformation, the evolution of the online for-profit college is becoming one of the more serious issues as gullible students are lured into the system with unfounded claims and promises.

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Having 20 years of experience in the classroom, I am skeptical about the expansive use of online teaching as a substitute for the discipline, accountability and content found in the structured classroom. So I have a bias.

Some of our institutions are offering online classes before they have adequate faculty so they can appear to be progressive in using the latest in electronic technology. It is my suspicion that some are using online classes to fatten their enrollment figures.

However, online for-profit colleges are something else. They are taking advantage of desperate students willing to pay high tuition, the availability of federal grants and student loans, and the lack of oversight by federal and state governments.

Students with an unrealistic dream of an easy degree are going into considerable debt in a gamble that the promises being made will put them into high-paying jobs that will amortize the outrageous tuitions. As a consequence, the default rate on loans among these students is staggering.

According to a Forum News Service report, the nationwide default rate in 2011 for all schools is around 10 percent. The default rate in 2011 for North Dakota was 4.3 percent; at North Dakota State University it was 2.5 percent.

Now compare this to the default rate of the online for-profit schools.

In a congressional hearing, Sen. Tom Harkin, D-Iowa, found that 25 percent of the for-profit students were in default within three years.

Nearly half of the federal student loan defaults are in for-profit schools even though they enrolled only 10 percent of the students.

In an analysis of the online for-profits, investigative reporter Daniel Golden of Bloomberg News claimed that the for-profits targeted underprivileged students who qualified for federal grants and loans. He alleged that many of the students dropped out before graduating.

In another Bloomberg report, John Hechinger said that "once enrolled in those schools, students submitted substandard work."

"In an online program leading to an associate's degree in business," Hechinger wrote, "an undercover student handed in plagiarized materials copied from online sources or verbatim from a textbook and was given full credit for his work."

These issues are not going unnoticed. The U.S. Department of Justice and four states are suing one for-profit company for fraud in a case involving $11 billion in state and federal aid taken during the period of 2003-2011.

The attorney general in Kentucky, joined by 22 other states, is leading an investigation into the abuses of online for-profit colleges and universities.

Even though all are not guilty, various investigations have produced a legitimate conclusion about online, for-profit colleges: They are exploiting innocent students and the American taxpayer.

In a policy statement, the American Association of State Colleges and Universities asserted that states have a major responsibility for dealing with the issues involved.

In North Dakota, this responsibility should be laid at the door of the Board of Higher Education and the Consumer Fraud Division in the attorney general's office.

While they may not be able to take punitive action against interstate activities, they can certainly do some course evaluations, engage in fact-finding and warn students about the pitfalls involved in online courses.

Also, it seems that the Board of Higher Education has responsibility for seeing to it that all of the online courses being offered by in-state institutions measure up to the rigorous standards of classroom instruction.

(Lloyd Omdahl, of Grand Forks, is a former lieutenant governor, state tax commissioner and state budget director)

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