The Government Accountability Office (GAO) released a report shining a light on the Department of Education’s oversight of and enforcement procedures for colleges and universities that provide inaccurate or misleading information about its programs, costs, or graduate employment.  The report stated that “students who enroll in colleges based on false or inaccurate information,” referred to as substantial misrepresentation, “may find themselves unable to secure a job or pay back their educational loans, which can shift the financial burden to taxpayers.”
 
The report noted that the Student Enforcement Unit, created by the Obama Administration in 2016, was given direct responsibility to conduct oversight of colleges and universities. Beginning in the Trump Administration, the unit experienced significant leadership issues and turnover, causing its staffing to shrink from nine employees to two.
 
The report notes that while the Department has “begun drafting key documents, it has not yet completed comprehensive instructions on when and how to select colleges for investigations and how to conduct those investigations.”
 
The Biden Administration has made a commitment to reestablish the unit and make its work a priority once again by hiring more staff. Enforcement was also a big part of the Office of Federal Student Aid’s five-year strategic plan that included the work of the unit.
 
GAO analysis showed that the Department imposed penalties on 13 institutions for substantial misrepresentation from fiscal years 2016 through 2021. Penalties included ending their participation in federal student aid programs or levying fines.
 
The GAO recommends that the Department do the following to hold institutions more accountable to substantial misrepresentation:

• Complete written procedures for substantial misrepresentation investigations, including for selecting colleges and conducting investigations; and
• Update written procedures for imposing penalties, as appropriate, on colleges that engage in substantial misrepresentation.