Following allegations of fraud and misrepresentation, Globe University and the Minnesota School of Business will no longer be able to offer their students federal aid. Under these circumstances, prospective students, current students, and even other schools may be heavily impacted.

The loss of student financial aid came in response to findings that the schools committed consumer fraud related to federal financial aid funds and misled students by misrepresenting their programs offered, according to the U.S. Department of Education.

A statement by Jeff Myhre, Globe University’s chief communication officer, describes the universities to have “unintentionally misled a fraction of students in [the] Minnesota criminal justice program.” Myhre also describes the decision to take federal financial aid away from the universities as continuing actions against career-focused institutions. Myhre stated that instead of helping students, the decision by the Attorney General and Department of Education will negatively impact thousands of students.

Kris Roach, executive director of admissions and financial aid at St. Thomas, said an event like this could be devastating to students currently studying at those universities since they would no longer have access to funds they rely on to pay for school.

“It’s my understanding in general that a lot of the for-profit institutions — which is what these are- – they have an awful lot of Pell Grant-eligible students, and they have students who are relying on federal student loans to be able to pay for school,” Roach said.

Associate Director of Admissions Joe Herrera said current students at affected colleges will also have trouble transferring the credits they already paid for and received. For instance, the credits from MSB and Globe University would not transfer to the University of St. Thomas since they are not accredited by the same organization.

“Not being a regionally accredited college like the University of St. Thomas, their credits traditionally don’t transfer to our institution,” Herrera said. “They may have invested two years’ worth of an education assuming that they’re going to have a chance to move on to other locations, and that’s the type of information (those schools) are not passing along very well.”

Prospective students will also be impacted, as the MSB’s website states that MSB and Globe University are not currently able to enroll new students.

“I feel bad for prospective students who were looking at those institutions, and now that’s a closed door, probably,” Roach said. “I really feel bad for the students currently enrolled because this what what you thought was going to be this great opportunity for you, you invested in it… and now it’s kind of poof — gone.”

However, this incident could impact a lot more students than just those studying at Globe University and MSB. The Accrediting Council for Independent Colleges and Schools, which accredits hundreds of institutions including Globe University and MSB, stated on their website the loss of its ability to accredit those institutions; in that case, all of those schools lose their access to federal student aid as well, putting many students in a difficult position.

“Colleges have to be accredited to provide an education,” Roach said. “The Federal Department of Education said (to ACICS), ‘You no longer are going to be recognized as being able to accredit these schools.’ So without accreditation, they can’t offer aid. So it’s going to be more than just Minnesota School of Business, more than Globe, more than ITT (Technical Institute).”

The universities and accrediting body have a short amount of time to argue their case, but if they do not submit sufficient evidence, the future may not be bright — especially with no incoming class. ITT Technical Institute recently went through the same situation, and according to their website, they closed down their campuses as a result.

“They’re going to have to jump through an awful lot of hoops before they would get anything back. It sounds like there’s legal things that are in the works right now, both for the accrediting body and for these two schools,” Roach said. “In the world of enrollment and financial aid, if you don’t have a class for a year or two, you won’t have any resources.”

Kassie Vivant can be reached at viva0001@stthomas.edu