Eisman rose to fame betting against subprime mortgages at Greenwich, Connecticut-based FrontPoint Partners LLC, a unit of Morgan Stanley. By 2010 he managed more than $1 billion for FrontPoint, and gained prominence after being profiled by Michael Lewis in his book “The Big Short: Inside the Doomsday Machine”. He left FrontPoint Partners in 2011 amid investor withdrawals following allegations that Joseph F. “Chip” Skowron, a co-manager of the firm’s health-care portfolio, traded on insider information.
Campaign against for-profit colleges
Eisman is a strong opponent of for-profit institutions of higher education. During a speech entitled "Subprime Goes to College" during the Ira Sohn Conference in May 2010 Eisman attacked companies that run private colleges such as Think ITT Educational Services, Corinthian Colleges, and Education Management Corporation. Eisman likened such companies to seamy mortgage brokers. From his presentation:
"Until recently, I thought that there would never again be an opportunity to be involved with an industry as socially destructive and morally bankrupt as the subprime mortgage industry. I was wrong. The for-profit education industry has proven equal to the task."
After the Department of Education took action against for-profit colleges in 2010 the industry retaliated by accusing Eisman of attempting to illegally influence the government and calling for an investigation by the Secretary of Education. The allegations stem from a meeting that Eisman had with Department of Education officials David Bergeron and Robert Shireman, two weeks before delivering his speech at the Ira Sohn Conference. Shireman was in charge of the department's efforts to toughen regulations on for-profit colleges.
After offering testimony to Senate Health, Education and Labor Committee on problems with for-profit higher education, Eisman was strongly criticized by progressive groups such as Citizens for Responsibility and Ethics in Washington on the grounds that he stood to profit from proposed regulations due to his short positions against private colleges.
- Jessica Pressler (5 August 2010). "Steve Eisman’s Outspokenness, Orchid Habit May Have Caused Rift With Morgan Stanley". New York Magazine.
- Andy Kroll (27 May 2010). "Steve Eisman's Next Big Short: For-Profit Colleges". Mother Jones.
- Did Steve Eisman unduly influence the Education Dept.?, by David A. Kaplan, Fortune, 2 November 2010
- Why Are Progressives Fighting Student-Loan Reform?, by Mike Elk, The American Prospect, 6 October 2010
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