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Education Department Blocks Aid for 2 For-Profits

December 7, 2016
 
 

The U.S. Department of Education said Tuesday it would block for-profit colleges Globe University and the Minnesota School of Business from receiving additional federal student aid.

As of Dec. 31, students will no longer be able to use funds from Pell Grants or federal direct loans at those institutions, which are jointly owned. The Federal Student Aid Enforcement Unit found that the programs committed fraud involving Title IV funds and misrepresented their criminal justice programs as well as the ability to transfer their credits to other colleges.

Globe enrolls about 1,000 students at 10 locations across the Midwest, and Minnesota School of Business enrolls about 700 students in Minnesota.

“Globe and MSB preyed upon potential public servants -- targeting those with a sincere desire to help their communities,” Under Secretary of Education Ted Mitchell said in a written statement. “These institutions misrepresented their programs, potentially misleading students, and abused taxpayer funds, and so violated federal law, which is why we removed them from the federal student aid program. This is a sober reminder that not all institutions deliver on their advertised promises.”

The department blocked access to Title IV aid for new students enrolling at ITT Technical Institutes in August -- a serious blow that was followed the next month by an announcement that the for-profit would close its doors at campuses across the country.

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