I realize that this is old news at this point. See the following articles for the impact of this report on the for-profit sector:
- Barrons Online: "CECO responds to 20% share drop, says investigation will vindicate"
- Inside Higher Ed: "Scrutiny for an accreditor"
- Associated Press: "Career Education drops as accreditor questioned"
For a little background, here is a description of the HLC:
I thought I would scan the document that set off this firestorm and see what the fuss is about: An Alert Memorandum with the subject line: The Higher Learning Commission (HLC) of the North Central Association of Colleges and Schools' Decision to Accredit American InterContinental University. Since a significant part of the 8-page memo is blacked out, it is hard to get at the specifics of the case. In a note to schools accredited by HLC, the president of HLC indicated that the focus of the audits was:
Reading through the background on the case raises some interesting issues about the accreditation process. AIU had originally been accredited by Commission on Colleges of the Southern Association of Colleges and Schools (SACS) in 1987. After receiving complaints in 2004, SACS placed AIU on probation for 12 months in 2005. After another review in 2006, they were placed on probation for another 12 months. Finally, in December 2007, SACS took AIU off probation. Meanwhile, AIU applied for and received accreditation from HLC in May 2009. A few other questions:
- Why didn't HLC review previous team reports from AIU's relationship with SACS?
- The multiple probation periods also raises the question of how many strikes (or probation periods) before a school loses its accreditation.
It is hard to read the conclusion of the OIG as anything other than a stinging rebuke of HLC and their processes:
It was the OIG's recommendation however that sent the hearts of many an accreditor aflutter by in effect calling for significant action, including the "death penalty" if HLC was found to be in non-compliance:
As for the shock this induced on Wall Street, those keen observers may have recalled these concerns expressed by the Acting Inspector General at a hearing this summer regarding distance learning:
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