The ‘new predators in higher education’

Insider

Ayelet Sheffey

June 1, 2023

Iola Favell wanted to go back to school to get her master’s degree in teaching.

Favell is a first-generation college student from California, and according to documents filed in a recent lawsuit, she felt it was important to earn her degree from a prestigious school. When she reviewed US News & World Report’s “2021 Best Education Schools” list, one program caught her eye — the University of Southern California’s Rossier School of Education. It seemed like the perfect fit: USC was in her home state, its online option offered the flexibility of remote learning, and it was ranked No. 12 on the list.

She applied and was accepted to the online program in 2020. But when she graduated in May 2021, Favell took home more than just a degree — she was also stuck with a $100,000 student-debt load. Just over a year after she got her degree, Favell and two other students who attended Rossier filed a lawsuit against USC with the help of the borrower-protection group Student Defense and Tycko and Zavareei LLP, a public interest private law firm. They accused the program of providing misleading information that pushed them into paying for a program that wasn’t what it had been made out to be.

“Ms. Favell incurred significant debt and out-of-pocket expense in reliance on USC Rossier’s position in the US News ranking,” the lawsuit said. “She regrets her decision to attend USC Rossier because of the false rankings information. She would not have attended had USC Rossier been ranked in a lower position given the high price tag of the school and/or would not have paid nearly as much.” USC denied the claims in the lawsuit.

The crux of the issue was USC Rossier’s partnership with an online-program-management company. OPMs partner with schools to build out online classes, providing everything from technical support and software to, in some instances, a curriculum that would typically be taught by university faculty. In exchange for expanding course offerings and recruiting students, OPMs receive a big chunk of the tuition revenue from the online programs, which usually cost the same as in-person schooling. The OPM model was a great deal for schools as online learning surged earlier in the pandemic: Fewer students wanted to take classes in person, and OPMs were there to do all the legwork to boost enrollment in virtual course offerings, which helped generate much-needed tuition revenue.

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