Government Drops A-Bomb On For-Profit Colleges

Blake Neff | Reporter

The federal government took a big step Thursday that will likely throw the for-profit college industry into chaos, as an independent regulatory committee moved to remove recognition of an accreditor responsible for accrediting hundreds of for-profit college campuses serving about 800,000 students.

The Accrediting Council for Independent Colleges and Schools (ACICS) is a non-profit body that accredits over 240 colleges with about 900 campuses and 800,000 students. The group’s accreditation is what allows these schools to receive about $5 billion in federal student loans a year, which many of them are dependent on to survive.

But Thursday evening, the National Advisory Committee on Institutional Quality and Integrity (NACIQI), a Department of Education body that evaluates accreditors, voted 10-3 to revoke ACICS’s power to accredit schools.

The vote came in the wake of a devastating government report that found ACICS routinely failed to adequately police schools under its oversight, allowing many institutions to deceive and defraud students. ACICS was responsible for accrediting Corinthian Colleges (which abruptly failed in 2014 while under investigation), Northwestern Polytechnic University (a degree mill that fabricated students’ grades), and numerous other schools that have been investigated or found responsible for underhanded behavior.

ACICS announced a series of reforms intended to improve its oversight, but it was too little, too late for NACIQI’s voting members.

“I need to hear more than, ‘We’re creating a committee,'” NACIQI voting member Simon Boehme said during its Thursday hearing. Several comparisons were made between ACICS-approved schools and Trump University, forcing ACICS head Anthony Bieda to clarify that the group had not, in fact, accredited that institution.

The vote is just the latest of many blows landed against the for-profit college industry during the Obama administration. In the last two years alone, the administration has imposed the gainful-employment rule, which denies student loans to for-profit programs whose students perform poorly in the labor market, and it has also announced new rules that will make it easier for students to sue their colleges.

The decision is not 100 percent final yet. ACICS will be able to appeal to Secretary of Education John King, and if that fails it could file a lawsuit in federal court. If these efforts all fail, schools will have 18 months to acquire a new accreditation. Some major schools, such as the 40,000-student ITT Technical Institute, may struggle to do so thanks to ongoing investigations of their business practices.

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