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Clinton Wooed For-Profit College Company And Clinton Benefactor To State Dinner

- July 31, 2015

Clinton Specifically Asked That "Laureate Universities, Started By Doug Becker Who Bill Likes A Lot" Should Be Included In A State Department Higher Education Dinner. (Hillary Clinton, Email To Cheryl Mills, 8/2/09; State Department Email Release, 7/31/15, p. 64)

Months After The State Department Dinner Invite, Bill Clinton Was Named "Honorary Chancellor" Of Laureate Education Inc.

New York Magazine Headline: "Bill Clinton Is The Face Of A Massive For-Profit College Company" (Caroline Bankoff, "Bill Clinton Is The Face Of A Massive For-Profit College," New York Magazine, 1/6/14)

In April 2010, Laureate "Scored Former President Bill Clinton As Its 'Honorary Chancellor.'" "Laureate Education Inc., a Baltimore-based for-profit higher education company, said Monday that it scored former President Bill Clinton as its "honorary chancellor" - a high-profile position that's expected to raise the company's profile abroad." (Gus G. Sentementes, "Laureate Enlists Clinton As 'Honorary Chancellor,'" The Baltimore Sun , 4/27/10)

Laureate's Private Chancellor Douglas L. Becker Refused To Say How Much Clinton Would Make As Honorary Chancellor. "Laureate evolved out of Sylvan Learning Systems, a publicly traded company until three years ago. Sylvan's founder, Douglas L. Becker, took Laureate private in 2007 in a $3.82 billion buyout and has spent the past three years steering the company's education business abroad. Becker said Clinton had expressed interest in learning more about Laureate's efforts during his world travels in recent years. … Becker declined to say how much Clinton would be compensated for his position at Laureate." (Gus G. Sentementes, "Laureate Enlists Clinton As 'Honorary Chancellor,'" The Baltimore Sun, 4/27/10)

  • On Hillary Clinton's 2015 Personal Financial Disclosure, Laureate Education Inc. Is Listed Under Spouse's Income Of "Unascertainable Value" And "Nonemployee Compensation Over $1,000." (Hillary Clinton Personal Financial Disclosure, Filed 5/15/15)

Laureate Also Became A Top Contributor To The Clinton Foundation

Laureate Education Inc. Has Contributed Between $1-$5 Million To The Clinton Foundation And Has "Made Five Commitments Through The Clinton Global Initiative." "The university system - part of Laureate Education Inc., which according to Bloomberg is the world's largest for-profit college chain - has been a seven-figure donor to the Clinton Foundation, giving between $1 million and $5 million, according to the foundation's website. Laureate has also made five commitments through the Clinton Global Initiative." (Maggie Haberman, "Bill Clinton Ends Role With Chain Of For-Profit Colleges," The New York Times , 4/24/15)

CLINTON HAS THREATENED FOR-PROFIT COLLEGES, LIKE LAUREATE, FOR UNSAVORY TACTICS

Clinton Called For Community Colleges, Technical Colleges, And Other Institutions To Provide “Transparency, Accountability, And Results.” HILLARY CLINTON: “We have to make sure that trainers, community colleges, technical colleges, union programs, any group or institution that is part of training young people for the jobs of the future have the resources they need to scale up respond to what the local work force requires, work with employers as Trident Tech does with the Chamber of Commerce… we have to make sure that everybody offering to train lives up to high standards of transparency, accountability, and results.” (Hillary Clinton, “Remarks At Trident Technical College,” North Charleston, SC, 6/17/15)

  • Clinton Called For Putting Education Institutions That Fail To Deliver On Their Promise To Students Out Of Business. HILLARY CLINTON: “Because let me just say unfortunately there are some programs that take people’s money and do not produce the results that were promised, and we’ve got to crack down on that and put them out of business.” (Hillary Clinton, “Remarks At Trident Technical College,” North Charleston, SC, 6/17/15)

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Laureate’s Track Record Makes It A “Bad Actor” That Clinton Aims To Target

Some Of Laureate’s Colleges “Have Drawn Criticism From Teachers, Students And Government Officials.” “That growth may come at a cost. While some of Laureate’s colleges rank high in private surveys, including Universidad Andres Bello in Santiago and Les Roches International School of Hotel Management in Bluche, Switzerland, others have drawn criticism from teachers, students and government officials.” (Mina Kimes and Michael Smith, “Clinton Pitches KKR-Backed College Chain Amid Controversy,” Bloomberg, 1/6/14)

  • Critics Say Laureate Increases Revenue By Driving Up Enrollment “Often Without A Parallel Increase In Academic Investment.” “They say Laureate boosts revenue at struggling colleges by turbocharging enrollment, often without a parallel increase in academic investment.” (Mina Kimes and Michael Smith, “Clinton Pitches KKR-Backed College Chain Amid Controversy,” Bloomberg, 1/6/14)

Since Laureate’s Takeover Of Centro Universitario IBMR, The School’s Quality Ranking Fell From 41 To 132. “Since Laureate took over IBMR in 2010, its quality ranking among small colleges in Brazil has dropped to 132 from 41, according to the government’s National Institute of Studies and Educational Research.” (Mina Kimes and Michael Smith, “Clinton Pitches KKR-Backed College Chain Amid Controversy,” Bloomberg, 1/6/14)

  • The Rio State Legislature’s Investigative Commission On Private Universities Targeted IBMR. “In April, the Rio State Legislature’s Investigative Commission on Private Universities issued a report criticizing for-profit colleges for firing professors. It singled out Laureate’s takeover of IBMR.” (Mina Kimes and Michael Smith, “Clinton Pitches KKR-Backed College Chain Amid Controversy,” Bloomberg, 1/6/14)

IBMR Has Increased Enrollment Through Aggressive Telemarketing Practices That Are Banned In The United States. “Laureate has also revamped the school’s sales operation. At IBMR’s telemarketing center, which didn’t exist before the company arrived, the school pays recruiters based on the number of students they sign up, a tactic that the U.S. Congress restricted in 1992 to stem misleading marketing gimmicks.” (Mina Kimes and Michael Smith, “Clinton Pitches KKR-Backed College Chain Amid Controversy,” Bloomberg, 1/6/14)

Laureate Increased 10,000 Students At Chile’s UDLA While Reducing Teachers, Leaving Graduation Rates As Low As 15 Percent In Some Majors. “In its decision, the commission wrote that, since 2010, UDLA’s academic standards have suffered as it has added almost 10,000 students while reducing the number of full- and half-time teachers to 399 from 408. Graduation rates were as low as 15 percent in some majors.” (Mina Kimes and Michael Smith, “Clinton Pitches KKR-Backed College Chain Amid Controversy,” Bloomberg, 1/6/14)

One Student Says The University’s Reputation Has Declined So Much, That “This Has Become The Place You Go When No One Else Will Accept You.” “Some UDLA students say its reputation has declined. ‘I meet people all the time who transfer here when they flunk out elsewhere,’ says Arturo Bisono, 25, an agronomy major. ‘This has become the place you go when no one else will accept you.’” (Mina Kimes and Michael Smith, “Clinton Pitches KKR-Backed College Chain Amid Controversy,” Bloomberg, 1/6/14)

At IBMR, Laureate Accepts Students “Who Score As Poorly As 20 Percent On The Entrance Exam.” “IBMR’s growth stems in part from its low admissions standards. Students who score as poorly as 20 percent on the entrance exam can get in, according to the school.” (Mina Kimes and Michael Smith, “Clinton Pitches KKR-Backed College Chain Amid Controversy,” Bloomberg, 1/6/14)

Moody’s Investment Services Recently Downgraded Laureate Education, Inc’s Credit Rating. “Moody's Investors Service downgraded the Corporate Family Rating for Laureate Education, Inc. (‘Laureate’) to B3 from B2 and its Probability of Default Rating to B3-PD from B2-PD.” (Moody’s Investors Service, “Moody’s Downgrades Laureate Education’s CFR To B3 From B2,” 7/1/15)

  • This Rating Downgrade Is Reflective Of Laureate’s “Aggressive Debt-Financed Growth.” “The downgrade reflects implementation of Laureate's aggressive debt-financed growth plans that have increased the company's leverage to levels no longer supportive of a B2 rating, while weakening the company's liquidity profile due to increased reliance on its revolving credit facility.” (Moody’s Investors Service, “Moody’s Downgrades Laureate Education’s CFR To B3 From B2,” 7/1/15)

“While Enrollment Growth Is A Positive, It Has Constrained The Company's Liquidity As Evidenced By Revolver Borrowings That Are Well Above Recent Historical Averages.” “Since March 31, 2014, Laureate has invested approximately $677 million in acquisitions and capital spending (gross, before proceeds from sale of assets) to support its growth plans, while total student enrollment has grown by nearly 20%. While enrollment growth is a positive, it has constrained the company's liquidity as evidenced by revolver borrowings that are well above recent historical averages with nearly $108 million in incremental borrowings year over year and average availability below 20% during the last four quarters.” (Moody’s Investors Service, “Moody’s Downgrades Laureate Education’s CFR To B3 From B2,” 7/1/15)


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