In 2007, Everest University, part of Corinthian Colleges, misled Jennifer Wilson about the loans she took out for her criminal justice degree as well as about the school’s job placement data. She was able to sue the school in 2015 to get $42,096 of her federal student loans discharged, but today, she would not have the same recourse because of changes in the U.S. Department of Education’s regulations.
Currently, changes to those regulations are on the table at the U.S. Department of Education’s negotiated rulemaking sessions, or NegReg. Strengthened borrower defense to repayment rules would ensure other cheated students could be made whole.
What Is NegReg? And Why Does It Matter?
On Oct. 4, the U.S. Department of Education began negotiated rulemaking, where it makes regulations to clarify any ambiguities in higher education lawmaking. Within the policy community, it is also called “NegReg.”
The 2016 negotiated rulemaking sessions established several rules that barred some schools from getting class-action waivers (to keep groups of students from suing) and from having pre-dispute arbitration agreements when students sue. It also made it easier for students to get debt relief (borrower defense to repayment) when they are cheated by unscrupulous schools.
During the 2018 rulemaking sessions, Education Secretary Betsy DeVos reversed many of the rules made in 2016, to the benefit of predatory colleges and to the detriment of student borrowers.
The current negotiated rulemaking sessions, now under Secretary Miguel Cardona, have the potential to restore and improve upon the 2016 rules, increasing accountability for colleges and aiding students in debt relief.
The call to Everest University changed Jennifer Wilson’s life. Just not in the way she had imagined. Wilson had searched for “criminal justice degrees” online, and Everest’s ads popped up everywhere she looked. She picked up the phone and dialed.
Growing up, Wilson dreamed of going to college, but her family never had much money, and college always seemed out of reach. After graduating high school, she went to work, got married, and started a family. But in 2002, tragedy struck. Wilson’s oldest daughter, Christina, just 20 years old, was found murdered in Fort Myers, Florida.
The years that followed were a fog of anger and depression. “When it happened, people stayed far away from us,” Wilson said in an interview with the Fail State team. “What do you say to somebody that lost their child to murder? There’s nothing you can say, really. So people stayed as far away from us as possible. And I could remember thinking: I wish I had somebody to talk to about this.”
In 2007, Wilson decided to harness her trauma for good. She wanted to become a victim’s advocate at her local police department. “I could talk to [families] and let them know they’re not alone in this. I have been on that end of it.” At the time, Wilson was working security at her local airport, and she often worked with law enforcement officers. When she asked how she could join their ranks, they told her she would need an associate’s degree.
The ‘Pain Funnel’
That’s how Wilson found herself searching online for criminal justice degree programs. When she reached Everest, a recruiter asked her why she wanted to enroll. Wilson explained how losing her daughter had set her on a path to help others. The recruiter quickly redirected the conversation to the murder, asking Wilson what happened, how it happened, who was responsible, and how she was coping. “[That phone call] took me back to 2002,” Wilson remembers.
What Wilson didn’t know was that the recruiter was preying upon her emotions to get her to enroll. Internal school documents uncovered many years later in an investigation by the U.S. Senate revealed that Everest employed predatory psychological sales techniques designed to induce vulnerable people into enrolling. They even gave the perverse tactic a name: “the pain funnel.”
To Wilson, that hour and half on the phone felt like someone cared about her and her well-being — like she had met a trustworthy new friend. Wilson doesn’t remember the phone conversation covering many details about the school itself or its online criminal justice program. But she still remembers how long they discussed Wilson’s tragedy.
Wilson recalls the questions the recruiter asked her about her family’s tragedy:
Having gained Wilson’s trust, Everest’s recruiter promised her that a degree from the school would be a worthwhile investment; that it would allow her to help other victims of tragedy. Everest had a high job placement rate in police departments, the recruiter claimed, and the school would be with Wilson “every step of the way” throughout her career.
By the end of the call, the recruiter told Wilson that she was sending her an overnight package with a school document to “hold her spot.” Wilson said she wasn’t ready to commit, but the recruiter told her not to worry. She could make the decision later. When Wilson tried asking about the cost of the program, the recruiter told her, “Let’s not discuss that right now. Our financial aid department will call you and help you understand the costs.”
‘Maybe I Misunderstood’
The next day the FedEx package arrived, and the recruiter called Wilson back. Wilson was still unsure, but the recruiter again promised the document was just to “hold her spot.” Wilson signed the form while she was still on the phone with the recruiter. A few days passed, but no one from the school called Wilson to go over the costs of the program. She called the school again and told another school representative that she was still unsure whether she wanted to enroll. The person on the line pulled up Wilson’s records and told her that she had already agreed to enroll and more forms were being sent for her to sign, including her financial aid documents.
Wilson was shocked. She said that couldn’t be right. The person on the line told Wilson she was “contractually obligated” to enroll. Wilson was hurt. She felt deceived. But she tried reasoning with herself that maybe she was responsible for the miscommunication. “What if it was just an oversight? Maybe I misunderstood her,” Wilson remembers telling herself, giving the recruiter and the school the benefit of the doubt.
She decided to proceed, thinking “I’m just going to make the best of this because this is something I have wanted to do my whole entire life.” When she started classes, her feelings and worries about Everest quickly subsided. She loved college. She loved her classes. She loved being a college student. She felt like she was finally following her dream.
Wilson had excelled in her classes, earning all A’s and graduating summa cum laude. She was glowing at her graduation ceremony and excited to take the next step in becoming a law enforcement officer. But that glow and excitement were short-lived.
In 2010, the year Wilson graduated from Everest University, the school advertised a 61% job placement rate for its criminal justice program. Four years later — after the school had shuttered — federal investigators found the real placement rate was 7%.
$40,000 in Student Loans
Shortly after taking her graduation photo, Wilson opened her leather-bound cover to look at her diploma. But instead of her associate’s degree, she found a bill for $3,500. Wilson would later learn that she had unknowingly signed additional private student loans in her name — loans that were issued by the school itself. She would have to pay the school back before she could get her diploma and transcripts. Wilson was forced to turn to her mom for a loan, and that was only the start of her troubles.
Wilson applied to multiple police departments around West Florida, but none would hire her. She tried calling the school dozens of times to use its job placement services, but she was never able to get anyone on the line to help her. She considered relocating, applying to jobs in other cities around the state, but still no department would take her.
After more than a year of trying, Wilson gave up. She returned to her security job at the airport, the same job she had prior to enrolling at Everest. All she had to show for her time was $40,000 in student loans.
Wilson talks about being deceived by the recruiter and Everest University:
In 2015, Everest University’s parent company, Corinthian Colleges, filed for bankruptcy and shut down its remaining operations. The company faced dozens of ongoing lawsuits and government investigations into predatory practices, including misleading and false job placement and graduation rates, predatory private student loan programs, and deceptive advertising practices. In 2016, a California court levied a $1.1 billion judgement against the shuttered company for its practices.
The Fail State team interviewed Wilson in 2015. Shortly after the interview, the filmmakers assisted Wilson in filing a borrower defense claim with the U.S. Department of Education, a process for student loan borrowers to have their loans discharged if their school was found systematically deceiving its students. After a prolonged three-year fight, Wilson won her claim and all $42,096 of her federal student loans were discharged.
Wilson’s full story is featured in the documentary Fail State.