June 27, 2012
Jefferson City, Mo. – Attorney General Chris Koster today announced a settlement with a company that targeted veterans and their educational benefits by deceptively steering them toward certain for-profit colleges. As a result of the settlement, the Department of Veterans Affairs will take over the company’s domain name and use it to provide comprehensive information to veterans about available benefits.
Koster alleges the company, QuinStreet, Inc., violated the state’s consumer protection laws in the course of operating websites such as GIBill.com that targeted military service members. Koster said the websites gave the appearance that the sites were operated, owned or endorsed by the United States government or military, and left the impression that the for-profit schools listed were the only schools at which veterans’ benefits could be utilized.
“Our veterans sacrificed the comforts of home and family, and many delayed their dream of receiving higher education, in order to protect our nation,” Koster said. “It is reprehensible that a company would target United States veterans with the hope of profiting from their hard-earned educational benefits.”
Koster said a multistate investigation found that the list of colleges on websites operated by the company, QuinStreet, consisted only of QuinStreet clients, which were primarily for-profit colleges.
For-profit colleges have intensified their recruitment of veterans since 2008, when Congress enacted the Post 9/11 GI Bill, making billions of dollars in educational benefits available for veterans and their families. According to a February 2011 General Accounting Office report, $9 billion in educational benefits were provided to service members and veterans in Fiscal Year 2010. Of 20 for-profit colleges analyzed by the U.S. Senate, total military educational benefits increased from $66.6 million in 2006 to a projected $521.2 million in 2010 – an increase of 683 percent. Some for-profit colleges target military members because their benefits don’t count toward the proprietary colleges’ cap on federal Department of Education funding. The law requires for-profit colleges to get 10 percent of their funding from other sources besides federal student loans or Pell Grants, but the GI Bill allows them to secure 100 percent of their funding from the federal government.
As part of the settlement, QuinStreet will relinquish ownership and control of the domain GIBill.com to the Department of Veterans Affairs, which will use the domain to promote the GI Bill program and educate service members about the benefits available to them under the program. QuinStreet will also shut down and cease to use any domain names that include the term “GI Bill.” In addition: