GIBill.com will be turned over to Veterans Affairs

A California-based company accused of preying on veterans for their education benefits agreed Wednesday to pay $2.5 million to 20 states and turn over its website, GIBill.com, to the U.S. Department of Veterans Affairs.

The consumer protection settlement between the states and QuinStreet Inc. was filed Wednesday in a court in Frankfort, Ky.

"The actions were unconscionable and purposefully drove veterans to for-profit colleges who were perhaps more interested in getting their hands on the federal benefits than in educating our soldiers and their families," Kentucky Attorney General Jack Conway said in announcing the settlement.

The agreement comes against a backdrop in which military veterans are a lucrative market for colleges. The newly expanded Post 9/11 G.I. Bill will pay colleges of all types around $9 billion this year to educate nearly 600,000 veterans. Many colleges boast of being "military friendly" and "veterans friendly."

QuinStreet, an Internet marketing and media company, called the agreement a "significant step forward in helping to clarify expectations for school advertising online, and for related website design and content."

QuinStreet officials said that they didn't view its websites as misleading and that GIBill.com has never been a "material contributor" to its revenue.

Nevada is among the states involved in the settlement. Attorney General Catherine Cortez Masto said the settlement will ensure that veterans know all the schools eligible for GI Bill benefits, not only the for-profit schools.

"This company purposefully deceived veterans into believing it was an official government site," she said. "No one should be deceived into selecting a school because of deceptive practices. Our settlement is a step to help ensure veterans will no longer be deceived by this company."

In Nevada, the case was handled by JoAnn Gibbs, senior deputy attorney general, Bureau of Consumer Protection.

Nevada's adjutant general, Air Force Brig. Gen. William R. Burks, spoke highly of the settlement.

"The Nevada National Guard has been working hand in hand with the state attorney general's office and with Holly Petraeus at the Consumer Financial Protection Agency to protect our airmen and soldiers from financial abuse and falling prey to misleading marketing," he said.

"We applaud the settlement and always encourage our Guardsmen to talk to our organization's education office before making decisions about pursuing their education," Burks said in a written response to questions from the Review-Journal.

Paul Szoldra, 28, a Marine Corps veteran who studies at the University of Tampa in Florida, also welcomed the settlement.

"Definitely a good day for the good guys," he said.

Szoldra said that when he was in the military, he looked for information on GI Bill benefits online and found GIBill.com. At that time, there was no disclaimer explaining who ran it, he said.

"I definitely thought it was an official site," Szoldra said.

The states alleged that QuinStreet violated consumer protection laws while operating websites that generate leads primarily for the for-profit education industry.

The states alleged that several of the company's sites, including GIBill.com, deceptively gave the appearance that they were operated, owned or endorsed by the U.S. government or military.

QuinStreet will relinquish ownership and control of GIBill.com to the Department of Veterans Affairs, which will use the domain to promote the program and its available benefits.

VA Deputy Secretary Scott Gould called the settlement a "positive step toward ensuring our veterans have the education opportunities they've earned." He said that "predatory, aggressive and deceptive marketing directly inhibits our ability to ensure they understand those options."

Students attending for-profit colleges make up about 13 percent of higher education enrollment, but those students also get about 38 percent of all the Post 9/11 GI Bill money, Conway said.

Members of Congress stressed their approval of the settlement during a news conference in Washington.

Sen. Dick Durbin, D-Ill., said the attorneys general stepped in where Congress had failed.

"It's reached a point now when you get little or nothing done when you take on the for-profit schools in Congress. Why? They own every lobbyist in town," Durbin said. "These are not the good guys. What the for-profit schools are doing to students and their families across America is shameful. What they're doing to veterans is disgraceful."

The Association of Private Sector Colleges and Universities, the trade association representing for-profit colleges, issued a news release saying it values its relationship with the nation's veterans and families and wanted to make clear it condemned any activity by companies that misleads them.

The Twitter, Facebook and other social media accounts associated with GIBill.com will shut down. QuinStreet will provide expanded disclosures on other military-oriented and education-related websites.

Szoldra has created his own website - www.collegeveteran.com - to help guide veterans through the minefield of searching for a school and re-entering civilian life.

"It can definitely be confusing," he said. "There's a ton of websites out there, there's a lot of 'military friendly' kind of schools or listing where they say these schools are military friendly and here's why. They're not really as comprehensive as they should be."

Sarah Minnis, who worked with veterans for three years at Texas A&M, said for-profit colleges often made promises that didn't come true.

"One of the biggest problems was that the credits the veterans earned wouldn't transfer to other institutions," said Minnis, who works on education issues with the Wounded Warrior Project.

Other states involved in the settlement are Alabama, Arizona, Arkansas, Delaware, Florida, Idaho, Illinois, Iowa, Massachusetts, Mississippi, Missouri, New York, North Carolina, Ohio, Oregon, South Carolina, Tennessee and West Virginia.

Conway's office said the settlement concludes the investigation of QuinStreet.

Las Vegas Review-Journal reporters Ed Vogel and Keith Rogers contributed to this report.