ED Revokes Title IV Eligibility of 26 For-Profit Campuses

By Allie Bidwell, Communications Staff

The Department of Education (ED) on Monday announced it will not allow 26 campuses of two for-profit college chains to participate in federal financial aid programs after investigations found "serious violations" within several campuses of the institutions.

ED said in a press release that it denied recertification for 23 Marinello Schools of Beauty campuses in Nevada and California, and three Computer Systems Institute (CSI) campuses in Illinois. The Office of Federal Student Aid sent letters to the schools notifying them of the decision.

According to the release, FSA found through investigations that CSI falsified job placement rates reported to students, ED, and its national accreditor, the Accrediting Council for Independent Colleges and Schools. FSA also found Marinello campuses were “knowingly requesting Federal aid for students based on invalid high school diplomas.” It also under-awarded federal aid to students and misrepresented itself in other ways.

"Our students depend on higher education institutions to prepare them for careers through a quality education," said Under Secretary Ted Mitchell, in a statement. "Unfortunately, some schools violate their trust through deceptive marketing practices and defraud taxpayers by giving out student aid inappropriately. These unscrupulous institutions use questionable business practices or outright lie to both students and the federal government. In these cases we are taking aggressive action to protect students and taxpayers from further harm by these institutions."

Between the 26 Marinello and CSI campuses, about 4,700 students will be affected, ED said.

The action is the latest in a series of investigations ED has launched in an effort to increase transparency and accountability among institutions of higher education.

In November, a joint investigation between ED and California Attorney General Kamala Harris led to recalculated job placement rates for Corinthian Colleges’ Wyotech and Everest programs. The correction of the misleading job placement rates could lead to more debt relief for students who enrolled in those institutions based on false information.

As for Marinello and CSI, the schools will be allowed to dispute ED’s findings with factual evidence, and have until Feb. 16, 2016, and Feb. 12, 2016, respectively, to do so.


Publication Date: 2/2/2016

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