Federal advisory board votes to kick out the nation’s largest college accreditor

An independent advisory board voted Thursday to bar the largest national accreditation agency from serving as the gatekeeper between colleges and billions of dollars in federal financial aid, bringing the Accrediting Council for Independent Colleges and Schools a step closer to losing its power.

In a 10 to 3 vote, the National Advisory Committee on Institutional Quality and Integrity denied the accrediting agency the recognition it needs to operate, out of concern that the council is incapable of rectifying years of lax oversight of troubled for-profit colleges. State attorneys general, lawmakers and advocacy groups have accused the council of letting schools under investigation for fraud or with rock-bottom graduation rates receive millions of dollars in federal loans and grants, putting students and taxpayers at risk. Still, some board members questioned whether the council is a scapegoat when the Department of Education is equally guilty of inaction.

Despite the severity of the board’s decision, there is still a glimmer of hope for the council. A senior official in the Education Department must make the final decision in the next 90 days, and the accreditation agency can appeal to Education Secretary John B. King Jr. If King upholds the decision to terminate the agency, nearly 300 schools will have 18 months to find a new accreditation agency to continue receiving federal financial aid.

The council gained notoriety for claiming that Corinthian Colleges, a for-profit chain that state and federal authorities said committed fraud, was in good enough standing to get billions of dollars in taxpayer funds. ACICS renewed two of the company’s campuses and authorized a new campus a few months before the Education Department forced Corinthian to close or sell its 120 locations. After Corinthian’s implosion, the council’s track record came under scrutiny as advocacy groups raised concerns about its approval of beleaguered for-profit institutions, including ITT Tech, Westwood College and FastTrain College.

All of the investigations and allegations of fraud emerged during the 11-hour deliberation Thursday, with advocates, Education Department staff and members of the council testifying before the advisory board. Department staff, which recommended the council be terminated a week ago, said the agency failed to monitor high-risk schools, ensure the accuracy of graduation rates and enforce actions against troubled schools.

“The agency has been complacent with a lot of actions at schools and thought maybe they weren’t all so bad until it blew up,” said Steve Porcelli, who worked on the department report. “Students came forward and said this is a widespread problem. It’s almost like a solid building where they weren’t paying attention and termites got in. Just after awhile, you realize the storm came and it’s blowing the house down.”

Council officials were contrite, acknowledging the shortcomings in the oversight of some schools in its care. The agency is undergoing a series of reforms in the wake of the Corinthian debacle, including more on-site evaluations, removal of board members with conflicts of interest and stringent enforcement actions. The organization also is identifying other means to reassess its governance, standards, operations and accreditation processes.

“We are committed to continued progress on the initiatives underway, and ACICS will employ whatever resources necessary to address and resolve these concerns. We only ask that we be given that opportunity to come back before you, fully compliant within one year or less,” Anthony S. Bieda, the newly appointed executive director, told the board Thursday.

But several board members said those actions are too little, too late. They said the last time the agency was up for review, officials promised to address problems identified by the board, but nothing changed.

Other members of the board, however, tacitly accused the department staff of reacting to public pressure to terminate the council. Board member Anne Neal, president of the American Council of Trustees and Alumni, accused the staff of accepting public comments that were critical of the agency as gospel, including the feedback in the report without analysis.

“Due process needs to apply, and I’m not sure when I read these kinds of comments in the staff report that this accrediting body is being given a fair shake,” Neal said.

Stripping the council of its power would leave hundreds of schools scrambling to find a new accreditor to prevent students from losing federal financial aid, and it could burden an accreditation system that might not have the capacity to absorb all of those schools. It also could be the death knell for some for-profit schools enmeshed in legal and regulatory fights, if other accreditation agencies refuse to work with them. Department officials have said they will work to help schools and the accrediting community in the event of the council’s demise.

A recent analysis from the Center for American Progress documents a pattern of the council turning a blind eye to abusive practices at the schools in its care. Of the 17 schools accredited by the agency that have been investigated by state or federal authorities, 12 had campuses hailed by the council for excellence between 2010 and 2015. A jury convicted former FastTrain College president Alejandro Amor on charges of stealing more than $6.6 million in federal financial aid by enrolling ineligible students and fabricating high school diplomas as far back as 2009, yet the for-profit school still received ACICS “honor roll” recognition in 2011, the report said.

“Thursday’s vote is a strong acknowledgement that ACICS’s failures were too significant to trust them with student livelihood and taxpayer dollars,” said Ben Miller, senior director for post-secondary education at CAP. “As the Department of Education works through the rest of this process, the conversation should now shift to ensuring an orderly transition so students are able to use their financial aid at places that serve them well.”