Selling Career Colleges Short

[Geee]

American Spectator:

Seemingly, there is no end to what once started as a relatively straight-forward story. The U.S. Department of Education embarked on an effort to impose new regulations that would severely restrict access to various federal loans and grant programs to students attending career colleges. Unlike state-owned public institutions and private, not-for-profit colleges, career colleges operate on a for-profit basis.

Since last autumn, this Dept of Ed effort to malign career colleges (or for-profit colleges) has been detailed in The American Spectator on several occasions (October 6, 2010; December 1, 2010; December 14, 2010; and January 18, 2011).

Recently revealed information suggests there may have been a financial motive involved in the Department of Education rulemaking.
Emails and related correspondence obtained from a series of Freedom of Information Act requests suggest stock market short-sellers including at least one who was a major donor to the 2008 Obama campaign had unusually strong involvement in the Ed Dept's process of crafting new regulations impacting career colleges. Advance knowledge of the agency's intention to write harsh regulations would benefit anyone shorting career college stocks with the expectation stock prices would plunge.

In late 2009, stock short-sellers Antal R. Desai and R. Kent McGaughy, Jr. of Dallas-based CPMG Investments met with Deputy Assistant Secretary of Education David Bergeron and senior Ed Dept official Ann Manheimer. Desai and McGaughy presented the two government officials with a 17-page document that severely criticized the career college sector. The document outlined recommended steps to be taken against career colleges to include actions by specific Congressional committees and an investigation to be conducted by the Government Accountability Office.
Neither Desai nor McGaughy were known for having expertise on the subject of post-secondary education. They brought little to the discussion aside from a game plan that, if implemented, could significantly degrade the value of publicly-traded stocks of for-profit colleges.

[clearvision]

I don't have a problem with for profit colleges, but it is/was getting out of hand with all the "Obama" money flowing in student grants/loans. The system was moving towards just getting bodies in versus education.

[Pepper]

By instinct, Obama and his cronies would be against any college operating on a For Profit basis as well as a college that actually produces a student capable of earning a living independent of taxpayer funding.

 

Their aim is perpetual students on campuses supported via taxpayer funding. More students = more Dem voters

 

High Level Officials at the U.S. Department Of Education Worked Closely with Short Sellers and Anti-Career College Advocacy Groups to Achieve a Predetermined Result

 

 

NLPC Calls for SEC Probe of Education Short-Selling Scheme