Feds consider shutting down college watchdog

Associated Press

Federal education officials are deciding whether to shut down the nation’s biggest accreditor of for-profit colleges over allegations that it overlooked deception by some of its schools.

The Accrediting Council for Independent Colleges and Schools is meant to be a watchdog for hundreds of for-profit schools, wielding the stamp of approval that colleges need to receive federal money. It’s one of many accreditors authorized by the U.S. Education Department to ensure the quality of schools. But the nonprofit is being accused of employing lax standards and failing to stop schools from preying on students.

Institutions that have operated under the group’s certification include the Corinthian College chain, which closed in 2015 amid fraud allegations, and the ITT Technical Institute chain, which now faces federal charges of fraud.

Even after the federal Consumer Financial Protection Bureau began investigating both in 2013, the council found no major problems during its own reviews. In 2014, it included two Corinthian schools on its annual “honor roll.”

“If accrediting agencies aren’t willing to stand up against colleges that are breaking the law, colleges that are cheating their students, then I don’t know what good they do, and I sure don’t know why we would let them determine which colleges are eligible for federal dollars,” Sen. Elizabeth Warren, DMass., said at a congressional hearing on Corinthian last year.

At least 17 colleges certified by the council have been subject to state or federal investigations, according to an analysis by the Center for American Progress, a liberal public policy organization in Washington. Over the past three years, those schools received more than $5.7 billion in federal money, the group said.

Attorney generals in more than a dozen states, along with other critics, want the Education Department to strip the council of its authority to accredit schools. The council is up for its regular review this month; it was last approved in 2013.

“This is an outfit that is in the business of sustaining and aiding and abetting with fraud and abuse,” said Barmak Nassirian, a federal lobbyist for the American Association of State Colleges and Universities. “It’s like a consumer fraud dream come true.”

Council officials declined to be interviewed for this story.

Losing recognition would effectively close the council and give its schools 18 months to find new accreditors. Otherwise they would lose access to federal money, the primary source of revenue for most for-profit colleges. Because the council oversees more than 900 schools, some experts question whether it will be spared because of its size.