The scandal revolves around alleged collusion between the Dept. of Education and Wall Street trying to influence regulation of a federal program known as "Gainful Employment:
"U.S. Rep. Glenn Thompson(R-PA) has continued thorough oversight of the administration’s regulatory proposals and program funding, in particular those related to Gainful Employment, a process that would impose arbitrary requirements on proprietary schools and deny access to thousands of higher education students, and has recently drawn bipartisan opposition.TY IP
In May 2010, Thompson requested the DOE to vacate the proposed regulations and recently worked with a bipartisan group of colleagues to pass House Amendment 214, an amendment to the Full-Year Continuing Appropriations Act of 2011, which would prohibit funds to be used by the DOE to implement regulations on Gainful Employment." (VIDEO)
Update: obliquely related: The SEC’s shrinking credibility.