New Articles Highlight Washington Post Conflicts

The Washington Post published two articles about its Kaplan subsidiary on Dec. 7 that illustrate themes we addressed in our blog the same day, which we entitled, "The Washington Post's Hidden Agenda?" Our colum addressed the inherent conflict when the Kaplan subsidiary provides 62% of the Post's revenue, with some methods allegedly so deceptive they are being aggressively investigated by state and federal authorities and other methods government funded or otherwise controversial. A newspaper's watchdog function on behalf of its readers, who contribute 4% of the Post's revenue via circulation and some 15% via advertising, is inevitably compromised when the lion's share of revenue is from another source.
In a related matter, the prominent Democratic lawyer and political commentator Lanny Davis founded a firm that represents the for-profit education industry, of which Kaplan is a prominent part. The news media, including the Post, frequently quote Davis regarding his views, which tend to espouse similar policies as the Post's editorial page. Melanie Sloan, longtime executive director of the watchdog group Citizens for Reponsibility in Ethics in Washington (CREW), has joined the Davis firm. She and CREW wrote a letter to Congress last summer suggesting that critics of the for-profit education sector were overzealous. Her letter followed a political column by Davis in a Capitol Hill newspaper making similar points. She and Davis say they came to independent conclusions, and decided only afterward to work together.
The new Post articles are excerpted below, with the full stories available by clicking the links:

Washington Post, GAO revises its report critical of practices at for-profit schools, Nick Anderson, Dec. 7, 2010.

The Government Accountability Office has revised portions of a report it released last summer on recruiting practices in for-profit higher education, softening several examples from an undercover investigation but standing by its central finding that colleges had encouraged fraud and misled potential applicants. The revisions have come as the Obama administration and senior Democratic lawmakers are pushing for tougher regulation of the industry. A Republican senator said the revisions called into question some of the conclusions in the report.

The original report, issued Aug. 4 in testimony to the Senate Committee on Health, Education, Labor and Pensions, examined recruiting practices at 15 for-profit colleges, including campuses operated by the Apollo Group, Corinthian Colleges and The Washington Post Co.'s Kaplan unit. Undercover GAO investigators posed as prospective students in encounters with college representatives that were captured in audio and video recordings. The GAO is a nonpartisan investigative arm of Congress.
Washington Post/Bloomberg, Washington Post's Kaplan unit to cut 770 employees, Olga Kharif, Dec. 7, 2010.
Washington Post Co.'s Kaplan Higher Education division said it plans to cut about 770 employees, or about 5 percent of the workforce, because of slowing enrollment. "These are difficult decisions to make, but necessary if we are to maintain the same high-quality education and support services our students expect," Jeff Conlon, chief executive officer of Kaplan Higher Education, said in a statement today….

Last week, a former dean of the unit alleged the company engaged in fraud to get U.S. student aid as he defended himself against criminal cyber-harassment charges in a federal jury trial under way in Chicago. In testimony in U.S. District Court, Bennie Wilcox, a former dean of law and legal studies at Kaplan University, said he witnessed Kaplan executives commit "multiple schemes" to defraud the U.S. government and taxpayers out of $1 billion. Kaplan denies the allegations. Wilcox claims the company retaliated against him when he exposed fraud in a pending whistleblower lawsuit in Florida filed in 2007.