The Government Deals Another Blow to For-Profit Colleges

September 22nd 2016

Kyle Jaeger

The federal government crackdown on for-profit colleges took an interesting turn on Thursday. It took action against the agency responsible for accrediting a number of for-profit colleges, including some that have been shuttered in recent years such as Corinthian Colleges and ITT Tech.

The Accrediting Council for Independent Colleges and Schools (ACICS) is one of more than 30 agencies that the U.S. Department of Education has allowed to accredit colleges. It's been the subject of scrutiny among lawmakers and regulators who've taken issue with the agency's tendency to accredit schools that profit off federal students loans and where students often struggle to repay their loans.

In a letter to ACICS Interim President Roger Williams, the U.S. Department of Education wrote that “ACICS was found to be in violation of numerous regulatory criteria” and that “[u]nder the law, an accrediting agency that is out of compliance cannot have its recognition renewed.” According to the letter, staff members for the Department of Education and the National Advisory on Institutional Quality and Integrity cited concerns about “the rigor of the agency’s accreditation and preaccreditation, it’s monitoring of the institutions it accredits, and the enforcement of its own accrediting standards.”

A 2016 report the Center for American Progress identified several additional concerns about the agency. For example:

"From 2010 to 2015, there were 90 instances where ACICS named campuses or institutions to its honor roll around the same time they were under investigation by state or federal government agents. And the 12 companies that own those campuses are just part of the 17 institutions or corporate entities under investigation that have accessed federal financial aid dollars wholly or in part due to ACICS’ decisions."

What will happen to the 600,000 students attending any of the 245 schools that ACICS has accredited?

All schools accredited by ACICS will have 18 months to find another accrediting agency to authorize them. If they're unable to renew their accreditation, students will not be able to receive federal student aid, which serves as a major source of revenue for for-profit colleges. "It may also make it difficult for those students to land a job or transfer credits to another institution," CNN reported.

The ACICS has appealed the U.S. Department of Education's decision. In a statement, Williams said:

"While we are disappointed in this decision, ACICS plans to continue diligent efforts to renew and strengthen its policies and practices necessary to demonstrate this agency’s determination to come into full compliance with the Department of Education’s recognition criteria and, most importantly, to improve outcomes for the estimated 600,000 students currently attending ACICS-accredited institutions. We are confident that if given the opportunity to do so, we will be able to demonstrate major reforms and ongoing progress towards compliance with the Department’s recognition criteria.”

RELATED: ITT Technical Institute Is Shutting Its Doors