ED Settles With Five Law Schools After Investigation Found They Improperly Disbursed Federal Financial Aid

By Maria Carrasco, NASFAA Staff Reporter

The Department of Education (ED) announced on Thursday settlement agreements with five law schools after a Federal Student Aid (FSA) investigation found that those schools improperly disbursed Title IV funds to students in unaccredited Master of Laws (LL.M.) programs.

According to ED, the five schools — Albany Law School, Atlanta’s John Marshall School of Law, Brooklyn Law School, New England Law – Boston, and New York Law School — improperly disbursed about $2.9 million in Title IV funds to 92 students across the five schools between July 2017 and June 2022. 

In its announcement, ED explained that the five institutions are “freestanding law schools,” meaning they are law schools that are not part of a broader university system that already is accredited. As a result, freestanding law schools need to be recognized by an institutional accreditor in order to offer Title IV aid to LL.M. programs or other non-Juris Doctor (J.D.) programs, since the American Bar Association (ABA) typically accredits J.D. programs. 

ED said that after an FSA investigation, the five law schools failed to secure the necessary accreditation to disburse aid for their LL.M. programs. Under the settlements, the schools will reimburse the expected loss to ED from the improperly disbursed funds, stop disbursing Title IV funds to students in ineligible programs, and agree not to seek reimbursement or to recoup the amounts paid as a settlement from any students or former students.

Additionally, three law schools which disbursed Title IV funds within the last five years must pay a fine, though ED did not state which three schools are responsible or what amount they’ll need to pay. ED clarified that the agreement does not mean an admission of wrongdoing or liability by the law schools. Additionally, ED noted that this isn’t the first time a freestanding law school that is ABA accredited has come under scrutiny for disbursing Title IV aid to students enrolled in an unaccredited LL.M. program. 

“Today’s actions demonstrate our commitment to protect the integrity of the federal student aid programs,” said Richard Cordray, FSA chief operating officer, in a statement. “Through our ongoing work, we will continue to protect both students and taxpayers.”


Publication Date: 8/29/2023

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