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Why experts say the $25 million college admissions scandal is 'just the tip of the iceberg'

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The way richer parents get their kids into college may be cheating, says economist Richard V. Reeves
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The way richer parents get their kids into college may be cheating, says economist Richard V. Reeves

On Tuesday, federal prosecutors brought charges against 50 people in a college cheating scandal wherein wealthy parents paid around $25 million to help their students gain admittance into exclusive colleges and universities including Yale, Stanford and Georgetown.

The Justice Department alleges that William Rick Singer, founder of Edge College & Career Network, a for-profit college counseling organization, helped students cheat on SAT and ACT exams, bribed athletic coaches and administrators to pretend that students were athletic recruits and used a charity he had established to funnel the funds.

Andrew E. Lelling, the U.S. Attorney for the District of Massachusetts
David L. Ryan/The Boston Globe via Getty Images

"There will not be a separate admissions system for the wealthy," said Andrew E. Lelling, the U.S. Attorney for the District of Massachusetts, in a press conference on Tuesday, "and there will not be a separate criminal justice system either."

But experts say this is just a colorful snapshot of the wider, darker realities of the U.S. college admissions system.

"This scandal is just the tip of the iceberg. The FBI said this scheme amounts to a 'rigged system,' but the truth is that the whole system of college admissions is rigged in favor of the wealthy," Richard V. Reeves, senior fellow of Economic Studies and co-director of the Center on Children and Families at the Brookings Institute, tells CNBC Make It. "Most of the colleges targeted by the scheme take more students from families in the top 1 percent of the distribution than from the whole bottom half of the income ladder."

Reeves, who is the author of "Dream Hoarders," says that there are several legal —but still immoral — ways in which wealthy families give their children an unfair advantage.

"Legacy preferences hugely favor the wealthy, as do many preferences for certain athletic skills, musical abilities, and so on. The children of big donors seem to get an almost automatic admission," says Reeves. "The difference between this illegal scheme and the legal ways in which money buys access is one of degree, not of kind."

In a phone conversation recorded by the FBI, Singer acknowledged this reality by way of describing his services. "We help the wealthiest families in the U.S. get their kids into school. There is a front door which means you get in on your own. The back door is through institutional advancement, which is 10 times as much money," he told one parent. "And I've created this side door in."

Sandra Timmons, president of A Better Chance, an educational non-profit that serves students of color, expects more examples of admissions cheating to be revealed.

"We are encouraged to believe in a meritocracy. This scandal is disappointing in that it demonstrates so much of what is wrong with our college admissions process. It is shocking in its wide-ranging scope, and we know there's more to come," Timmons said in a statement. "It is heartbreaking for the many honest, hardworking students who want to believe in a level playing field."

Graduates walk before the commencement ceremony at the University of Southern California (USC) in Los Angeles, California, U.S., May 12, 2017
REUTERS/Patrick T. Fallon

Johan Zhang, co-founder of CollegeVine, a high school guidance and college admissions advisory says the current U.S. higher education system gives rich students with access to college preparatory services an upper hand in the admissions process.

"This scandal highlights just how unfair the college admissions process has become," he tells CNBC Make It. "The college admissions process is incredibly confusing and stressful, especially for public high school students who are underserved by their overworked guidance departments."

Zhang says that there are however, ways to make the system more equitable. "The only way to close this growing guidance gap is to harness the power of big data to enhance students' odds of finding, getting accepted to and affording the right school for them."

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