Ashford University - 2011 Senate Hearings

2011 Senate Hearings

On March 10, 2011 Senator. Tom Harkin (D-Iowa) chaired a hearing of the Health, Education, Labor, and Pensions Committee that examined a case study of Ashford's parent company, which has experienced near-exponential profit growth in the last few years despite low graduation rates. Bridgepoint owns two universities that it purchased when both were near bankruptcy, Ashford University in Iowa and the University of the Rockies in Colorado. When it purchased Ashford University in 2005, it had less than 300 students but today it claims to have over 78,000 students, 99% of which are online.

Senator Harkin took issue with the fact that despite such growth of the company, student success was lacking. According to information provided by Senator Harkin in the committee hearing, 63% of students who enrolled at Ashford University during the 2008-2009 school year withdrew before completion of their perspective program. Senator Harkin pointed out that Bridgepoint recorded more than $216 million in profits in 2010; of which 86.5 percent of its revenues come from federal funds. In reference to the dependence of Bridgepoint on public funds, Senator Harkin was quoted as saying, "I think this is a scam, an absolute scam."

Kathleen Tighe, who is an inspector general with the U.S. Department of Education, testified at the hearing that in an audit of Ashford, she discovered Ashford was improperly distributing student aid to students. "Seventy-five percent of the improper disbursements to students in our sample were made to students who never became eligible," Tighe said. Bridgepoint hadn’t returned the improperly obtained student aid to the federal government, and said on a recent report she’d seen that Bridgepoint was “sitting on $130 million” in these types of funds.

Due to the ongoing Office of Federal Student Aid (FSA) proceedings, and in order to preserve due process, Ashford's parent company, Bridgepoint Education, chose not to send executives to the HELP committee hearing while engaged in negotiations with FSA. Rather, Bridgepoint published a summary of responses called Bridgepoint Education Transparency.