For-Profit College Group Sues Over Regulations

01/21/2011 04:45 pm ET | Updated May 25, 2011

A group representing for-profit colleges and trade schools filed a federal lawsuit Friday against the U.S. Department of Education seeking to block new regulations of the sector.

For-profit colleges, which rely heavily on students receiving federal aid, have been criticized for leaving too many students with large debt and questionable job prospects.

The lawsuit from the Association of Private Sector Colleges and Universities, filed in the U.S. District Court for the District of Columbia, challenges new rules issued in October that are scheduled to go into effect July 31.

At issue are regulations that prohibit paying recruiters based on how many students they enroll, seek to rein in deceptive advertising and require states to authorize colleges for students to be eligible to receive federal loans.

The group argues the regulations go behind "lawful regulatory efforts." The lawsuit seeks a voluntary withdrawal of the new regulations or a preliminary injunction to block them.

An Education Department spokesman said Friday the department is confident the published regulations "will do the best job of protecting students and taxpayers."