The Education Department on Thursday moved to shut down the nation’s largest accreditor of for-profit colleges, the Accrediting Council for Independent Colleges and Schools.
An accreditor’s seal of approval is a prerequisite for colleges’ enrollment of students getting federal student loans and aid, a funding stream that's essential for the institutions’ survival.
The move immediately imperils for-profit colleges’ access to the roughly $130 billion in federal student loans and grants that annually flows to schools, leaving nearly 250 colleges at risk of shutting down, says Bloomberg.
Among the issues involving ACICS were conflicts of interest. At least two-thirds of its commissioners were executives of for-profit colleges, according to a ProPublica investigation.
An estimated 600,000 students now attending schools the council has accredited are in no immediate danger of losing their federal financial aid. The schools have 18 months to get the approval of another accreditor — though they may have to meet stricter standards.