Prepared Remarks by Holly Petraeus at the Attorneys General Announcement on GI Bill Lead Generators Press Conference
Assistant Director for the Office of Servicemember Affairs
Consumer Financial Protection Bureau
Attorneys General Announcement on GI Bill Lead Generators
June 27, 2012
I’d like to start by thanking Attorney General Conway for his leadership on this issue, as well as Generals Madigan and Biden and the entire bipartisan group of Attorneys General who were part of this settlement. They saw a problem, took action on it, and today we see the positive end result.
I’d also like to thank the Senators in attendance – Senators Harkin, Durbin, Hagan and Blumenthal – for their support of the military community and their leadership on consumer-protection measures for our servicemembers, veterans and their families.
I’ve been part of the military community my entire life and I know it well. I’ve lived at military bases overseas and in the US, and seen the Army from the perspective of a daughter, sister, wife and mother of soldiers. One of my brothers went to college on the GI Bill after he served in Vietnam, as a matter of fact. And now, in my current capacity as the head of the Office of Servicemember Affairs at the Consumer Financial Protection Bureau, or CFPB, I see a new crop of servicemembers, veterans and their families also wanting to better themselves by going to college – and I have been hearing from them about the challenges of selecting a college that will provide the most “bang for their buck.”
I’ve been to 37 military installations since I started at the CFPB, conducting roundtables and town halls both to inform servicemembers about my agency and also to hear from them about the financial issues that are impacting them. One of the issues I’ve heard about repeatedly is the aggressive pursuit of GI Bill and military Tuition Assistance dollars by certain institutions of higher education.
Servicemembers and veterans are very attractive to for-profit colleges because they fill a need to enroll students who are not using Title IV federal education funds. These prospective students, or “dollar signs in uniform,” as I once called them, are subjected to a barrage of aggressive and sometimes downright misleading marketing from for-profit colleges. Billions of dollars are spent annually by these schools on advertising campaigns. In contrast, I was told by an official at a public not-for-profit university in Illinois that his annual marketing budget, to include website upgrades, was $20,000. Not exactly a level playing field when it comes to marketing.
I’ve heard from Education Service Officers at the bases and National Guard units that I’ve visited that they feel “besieged” by the tactics of recruiters from certain for-profit schools. They will snap up tables at job fairs, offer to sponsor unit events, and campaign relentlessly for access to the unit’s members.
I’ve even heard about cases where for-profit recruiters have managed to obtain exclusive access to wounded warrior barracks, offering what is presented as biweekly educational counseling.
At Fort Campbell, Kentucky with General Conway last August, I heard from a military spouse who was under the impression that her college was “military-affiliated.” It wasn’t – but she had certainly received that impression from the college’s recruiter. She was called multiple times per day by the college until she signed up – after that she couldn’t get anybody to take her calls when she was unable to log on to her online class. She was left with a failing grade – and the bill.
I’ve also heard about – and looked at – self-styled “GI Bill” websites that present themselves as offering unbiased information about GI Bill benefits, but that in reality only exist to drive servicemembers and veterans to the for-profit schools that pay for the site.
Using one of these lead-generator sites is extremely unlikely to assist veterans in making an informed choice between different types of schools where they might spend hard-earned GI Bill benefits. Instead, no matter what the veteran’s educational goals or financial situation, the recommendation always seems to be that they attend a for-profit school that is paying for the site, even though it may cost more and have higher student-loan default rates and lower graduation rates.
I’d like to thank those assembled here today for their determination to see that servicemembers and veterans get the information they need to use their GI Bill benefits in the best way possible for them. Thank you for pursuing new consumer protections that will help ensure that veterans looking online to learn more about the GI Bill will find accurate information about the benefits they have earned, instead of a sales pitch.
We, too, will continue to work on GI Bill issues with federal, state and local officials, and we encourage servicemembers and vets with student loan concerns to visit us at ConsumerFinance.gov, where they can file a complaint or tell us their story.
To view Senator Harkin’s findings, visit http://harkin.senate.gov/documents/pdf/4f9ac62292704.pdf