Some for-profit colleges and universities have come under fire for their questionable practices in relation to students and their loans.
On June 24, Steven Eisman, an investment mogul and hedge fund manager, will testify before Senate, citing that schools are encouraging students to take out student loans while also encouraging them to not pay them back.
Similar to the mortgage crisis where some lenders knew the buyers couldn’t repay their student loans, these schools are being accused of having the students take out loans to get federal money flowing through the schools, knowing that repayment for the students is almost an impossibility (Business Week).
[...] has been proven by the recent practices discovered at for-profit universities where students have been encouraged to default on loans because the institutions profit so generously from the government [...]