Apollo Education Group, the for-profit education company, is getting destroyed.
The stock is down 10% on the news that the Department of Defence will no longer allow servicemembers to use federal money to attend one of its subsidiaries The University of Phoenix.
And so The University of Phoenix will also no longer be able to recruit on military bases, The Wall Street Journal reported.
“The institution will not be authorised access to DoD installations for the purposes of participating in any recruitment-type activities,” said Dawn Bilodeau, chief of the Defence Department’s Voluntary Education program.
“Further, no new or transfer students at the institution will be permitted to receive DoD tuition assistance.”
On Wednesday Apollo released an 8K saying that the DoD had put it on probation for using its logos without permission and holding events on military installations without the proper clearance.
On October 7, 2015, our wholly-owned subsidiary, University of Phoenix, Inc., was notified by the U.S. Department of Defence (“DoD”) that the University had been placed on probationary status in respect of its participation in the DoD Tuition Assistance Program for active duty military personnel, and that the DoD is considering whether to terminate the DoD Voluntary Education Partnership Memorandum of Understanding with the University (“DoD MOU”) which is the basis on which the University’s active duty military students participate in the DoD Tuition Assistance Program. While on probationary status, currently eligible enrolled students will remain eligible to participate in the Tuition Assistance Program, but newly enrolled or transfer students of the University will not be eligible. In addition, while on probationary status the University will not be permitted to engage in various activities at military installations, including job training, career events, fairs and other sponsored events.
The University of Pheonix is holding more student debt than any other college in the U.S., exploding from $US2.2 billion in 2000 to $US35.5 billion in 2014.
Think about that for a moment, and then look at this graphic from Brookings.