Coming Soon: An International Student Recruiting Scandal

Are non-profit colleges headed for a major recruiting scandal of their own making involving the use of commissioned salespeople?

Federal law prohibits colleges from providing “any commission, bonus, or other incentive payment based directly or indirectly on success in securing enrollments” to admissions officers. Congress put the incentive compensation ban in place in 1992 as part of a broader effort to crack down on unscrupulous for-profit schools that were enrolling unqualified, low-income individuals to get access to federal student aid funds. But in doing so, lawmakers created a double standard that many traditional colleges are now taking full advantage of: the prohibition doesn’t apply to the recruitment of foreign students because they are not eligible for federal student aid. In other words, it is perfectly legal for colleges to make commissioned payments to recruiters for each international student they enroll.

This has become a major issue in recent years because there has been an explosion of growth in the enrollment of international students at colleges across the country. According to an article in the latest edition of the Washington Monthly’s College Guide, the number of foreign students attending colleges in the U.S. “has ballooned by roughly 200,000” over the past six years to a total of more than 764,000.

Public universities, facing declining state revenues, have been especially aggressive in seeking to attract international students who can pay full freight. Top state schools have “doubl[ed] or even quadrupl[ed] their total international enrollments in just a few years,” particularly by increasing “their undergraduate Chinese student enrollment dramatically,” the Washington Monthly reported.

Because many colleges are reluctant to go to the expense of sending their own admissions officers overseas, many schools rely on third-party international recruitment agencies to find students, and pay them a per-student commission for their services. An investigation by Bloomberg News in 2011 found that the agents also typically charge students a hefty fee, and sometimes even require them to hand over a portion of any scholarships they receive. While there may be many reputable agents, there are also plenty of sketchy ones, who “often misrepresent or conceal their U.S. affiliations,” and offer false promises to lure students in, Bloomberg reported. Agents have also been accused of writing students’ college application essays and falsifying the high school transcripts they send schools.

Alarmed by such reports, the National Association for College Admission Counseling (NACAC) in 2011 reminded its members that they were barred from providing per-student commissions both here and abroad. “Reducing the basis for compensation to the number of students enrolled in any circumstance introduces an incentive from recruiters to ignore the student interest in the transition to postsecondary education, and invites complications involving misrepresentation, conflict of interest, and fraud at the expense of the student,” the organization wrote at the time.

The organization’s stance outraged a significant share of its members, who argued that banning such practices was unrealistic and would cripple the ability of many colleges to recruit foreign students. They said that efforts by a group known as the American International Recruiting Council, which is made up of colleges and international recruiting agencies, to set standards and credential foreign agents were sufficient to ensure ethical practices.

After two years of fierce debate, NACAC backed down in September. The group is now allowing its members to “use incentive-based agents when working with international students outside the U.S.” as long as they follow new guidelines ensuring “accountability, transparency, and integrity.” The organization will spend the next year fleshing out just what these guidelines should be.

But considering that many of NACAC’s members flouted the ban in the first place, who’s to say that they will pay more than lip service to the new standards?

Despite NACAC’s change of heart, the group’s initial concerns still stand. Paying recruiters for each student they enroll simply invites abuse — as the over-riding incentive these individuals have is to reel in students, whether it’s in the best interest of these students or not.

As I’ve written before, colleges should not allow expediency and the promise of great riches cloud their better judgment. Providing per-student commissions to international agents, who otherwise have no real ties or loyalty to the schools, is a recipe for scandal.