In March of 2011, the United States Senate Committee on Health, Education, Labor, and Pensions did a special investigative study of San Diego's for-profit Bridgepoint Education. Many shocking facts surfaced: Bridgepoint spent nearly 30 percent of its revenue on marketing. By 2010, 84.4 percent in the two-year degree had dropped out. Then-Sen. Tom Harkin, a Democrat from Iowa who retired in 2015, declared Bridgepoint was "a scam, an absolute scam."
At year-end 2016, the company, 59.8 percent owned by Wall Street's Warburg Pincus, was being investigated by by the Consumer Financial Protection Bureau, the Securities and Exchange Commission, and the states of Iowa, New York, Massachusetts, California, and North Carolina. It has been investigated by the Department of Education over several issues.
Nonetheless, as the New York Times revealed in a front-page story Saturday (March 18), Bridgepoint's vice president for regulatory services, Robert Eitel, is working as a special assistant to the new head of the Department of Education, Betsy DeVos. Eitel has been a strong opponent of regulation of for-profit universities and colleges. He is now on unpaid leave from Bridgepoint.
Immediately after Donald Trump's election as president, the stocks of the for-profits shot up, in anticipation of easier regulation under Trump. Bridgepoint stock rose sharply despite dismal results in recent quarters.
The Times said that around Washington D.C, ethics questions are being raised about Eitel's job working for DeVos. In January a partner of Warburg Pincus and boardmember of Bridgepoint resigned from the board to join Trump's economic team.