Student Loan Scandal Update

Yesterday we blogged about the Washington Post’s dependence on income from its ownership of Kaplan, whose for-profit-universities are being accused of defrauding the government. tODD points out that its universities are only part of the Kaplan empire, doing the math to show that the percentage of the Post’s income from the colleges and from the taxpayers is smaller than the 62% I cited. Meanwhile, in another case of surprising readers of this blog, one of the original litigators who helped expose the corruption at Kaplan, Mike Aguirre, wrote in. You need to read his post in the comments. It tells about how Kaplan officials were caught destroying diplomas of “phantom students” who didn’t really exist, but who apparently were made up by the university just to get student loans. Mr. Aguirre also noted the staggering sums that flowed into Kaplan from the Title IV student loan plan:

> Finally, I would like to note the following amounts of Title IV funds paid to Kaplan in addition to those identified in the operative complaint.
> In 2005 Kaplan derived more than $500 million of its revenues from Title IV funds. In 2006 Kaplan derived $580 million of its revenues from Title IV funds. In 2007 Kaplan Title IV revenue was $745 million, or approximately 73%, of total KHE revenues. In 2008 Title IV funds accounted for $904 million, or approximately 71%, of total KHE revenues. During 2009 Title IV funds accounted for $1.283 billion million, or approximately 83%, of KHE revenues.