Accrediting agencies serve as gatekeepers between colleges and billions of dollars in federal financial aid. This past December, the Secretary of Education, John B. King Jr., removed Accrediting Counsel for Independent Colleges and Schools (ACICS) as a gatekeeper. ACICS, one of the largest national accreditation agencies, lost its appeal to maintain its role of facilitating federal financial aid.
ACICS lost the trust of the Education Department when it claimed Corinthian Colleges – a for-profit college who authorities claimed committed fraud − was in good standing to receive billions of taxpayer dollars. As an accreditor, ACICS set its own standards and policies; however, the advisory board at the Education Department is allowed to review those standards and strip the accreditation agencies of their power if need be. These accreditation agencies are stewards of federal finical aid, and the government depends on their sound judgement in allocating the funds, which fuel colleges and universities across the country.
ACICS was accused of using atrocious judgement in allowing millions of dollars in federal loans and grants to go to colleges that have been accused of fraud or that have appalling graduation rates. This allocation of federal funds places both students and taxpayers at unnecessary risk.
The funds help promote and prosper schools, and when the funds go to for-profit schools that are not delivering the education needed for the students to graduate and succeed, it places more students at risk. Moreover, the federal funds granted to these schools are paid from the tax pool; therefore, when colleges with a propensity to commit fraud are awarded these monies, it places not only the students at risk, but also the taxpayers, as it would be their money the colleges would be fraudulently spending.
One avenue students and taxpayers can use to help reduce these risks is the False Claims Act (FCA). The FCA allows private individuals to file lawsuits on behalf of the government when those individuals have knowledge of a person or company defrauding the government. These lawsuits are filed under the qui tam provision of the FCA, as ordinary citizens become whistleblowers by reporting the fraud. Recruiters, admissions counselors and career service personal are often in the best position to uncover such fraud
The FCA provides monetary incentives and protection for whistleblowers, which include 15 to 30 percent of the damages recovered.
Beasley Allen continues to investigate whistleblower claims involving the misuse of federal funds in the for-profit education industry. For example, Beasley Allen represented some of the whistleblowers responsible for uncovering the fraud connected with Corinthian Colleges, which led to a $30 million fine against Corinthian and, ultimately, the bankruptcy and closure of the school.
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Are you aware of fraud being committed against the federal government, or a state government? If so, the FCA can protect and reward you for doing the right thing by reporting the fraud. If you have any questions about whether you qualify as a whistleblower, please contact an attorney at Beasley Allen for a free and confidential evaluation of your claim. There is a contact form on this website, or you may email one of the lawyers on our whistleblower litigation team: Archie Grubb, Larry Golston, Lance Gould or Andrew Brashier.