Under Scrutiny Itself, For-Profit Accreditor Gets Tough With ITT Tech

April 22, 2016

The embattled accrediting organization that is under scrutiny for its approval of many controversial for-profit colleges is now taking action against one of the nation’s largest for-profit college chains.

The Accrediting Council for Independent Colleges and Schools has ordered ITT Technical Institutes to prove why it shouldn’t lose its accreditation or otherwise be sanctioned, the company told investors on Thursday.

The accreditor informed ITT Tech this week that allegations from various state and federal agencies “call into question” the institution’s “administrative capacity, organizational integrity, financial viability and ability to serve students in a manner that complies with ACICS standards,” the company said.

ACICS cited the U.S. Department of Education’s decision to place ITT on heightened cash monitoring, a lawsuit by the Consumer Financial Protection Bureau, a lawsuit by the Securities Exchange Commission and investigations into the company by several state attorneys general.

The show-cause order requires ITT to go before ACICS in a hearing where it can argue for why its accreditation should not be withdrawn or conditioned.

ITT said Thursday that it “is confident that it has [met] and will continue to meet the ACICS accreditation standards.”

The action by ACICS comes just several days after its chief executive officer, Albert Gray, resigned amid the growing scrutiny the organization is facing.

Gray was lambasted by Senator Elizabeth Warren at a hearing last year for defending ACICS’s approval of Corinthian Colleges even as various state and federal investigations and lawsuits piled up.

The Education Department will have to decide this summer whether ACICS should continue to be recognized by the federal government. Twelve state attorneys general and a coalition of higher education, consumer and labor groups have called on the department to deny ACICS federal recognition.

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