The accreditor responsible for overseeing the colleges operated by the Center for Excellence in Higher Education (CEHE) withdrew accreditation years later than it should have.

During a 13-year period starting in 2008, the Accrediting Commission of Career Schools and Colleges (ACCSC) raised concerns more than 30 times that colleges affiliated with CEHE were potentially failing to meet standards for quality, honesty, and other attributes crucial to students. And yet CEHE never fixed the vast majority of these problems.

A state agency and several federal government agencies also alleged wrongdoing by the colleges – including an accusation from the U.S. Department of Justice about illegal recruiting practices. [1]  Last year, a Colorado judge ruled that colleges operated by CEHE had knowingly engaged in deceptive practices, misleading students about graduates’ earnings, job opportunities, and ability to repay loans provided by the colleges. [2] 

Finally in April 2021, 13 years after concerns were first raised about the chain in 2008, ACCSC withdrew CEHE’s accreditation – the seal of approval that made the colleges eligible for federal student aid funds. Since 2008 the colleges already had received a total of $1.8 billion in federal grants and loans. [3] 

This is a story about how a system that is supposed to guard higher education against poor quality and fraud utterly failed students and taxpayers.We have documented 13 years of actions and findings from ACCSC that fell short of true accountability. Despite overwhelming evidence, it took far too long to pull the plug on CEHE, leaving tens of thousands of students in harm’s way.

We examine the rules guiding accrediting agencies and list its many actions to determine how an accreditor could ostensibly follow all its rules in overseeing a chain of schools yet not put a stop to the chain’s waste and abuse until far too late. While regulations require accreditors to demand that colleges improve within a defined amount of time or risk losing accreditation, there are a variety of loopholes that allow accreditors to get around this requirement.

The Center for Excellence in Higher Education was not always a company that operated colleges. From 2007 to 2012, it functioned as a public nonprofit charity in Indiana that focused on higher education and philanthropy. [6]  However, on December 31, 2012, CEHE merged with for-profit corporations Stevens-Henager College – which included Independence University, CollegeAmerica Denver, CollegeAmerica Arizona, California College San Diego, and California College – as well as College America Services Inc., which provided management and operational support to each of the chains. Combined, this included a total of 16 campuses with physical locations in Arizona, Idaho, Wyoming, Utah, and Colorado. [7]

The merger with CEHE was not a big change for the colleges: Both before and after the merger they were operated by the same person, Carl Barney. [11]  Before the merger, Barney was the owner and sole shareholder of each of the individual corporations. After the merger, he maintained effective control of the colleges. Barney was ultimately responsible for creating the advertising, lead generation, and enrollment practices at the colleges, along with all other practices and policies guiding them.

Before the merger, CEHE was already an IRS tax-exempt organization. After the merger, it filed a routine request to be categorized by the IRS as a tax-exempt educational organization, a move that would allow the colleges to claim themselves as nonprofit while potentially avoiding regulations and taxes. [12]  The Department of Education initially denied the request but later settled in court and eventually classified the colleges as nonprofit in 2018. The underlying operations of the colleges did not fundamentally change. [13]

Colleges operated by CEHE made most of their money from low-income students At the Denver campus, 80 percent were federal Pell Grant recipients. [14]  More than 60 percent of students at the chain would not graduate, and only 16 percent paid down a single dollar on the principal of their federal loans three years after leaving.

From 2012 onward a Colorado state agency and multiple federal agencies continued to raise flags concerning operations at CEHE colleges. In September 2019, CEHE announced it was stopping enrollments at all physical locations to shift its focus online, noting at the time that it was not closing campuses. [15]  But CEHE ultimately changed course and by July 2020 it had decided to close campuses before all students had finished their programs. [16]  Following these closures, in October 2020, CEHE completed consolidation of the former main campus, Stevens-Henager College of West Haven, Utah, and the online branch, Independence University (IU), into one entity, making IU the only campus not in the process of closure. In 2019, before the closures, these colleges together served about 2,100 students at physical locations and another 10,000 online. [17]

By the time ACCSC withdrew accreditation, IU was the only fully operating CEHE college. [18]  Six additional campuses – under the names Stevens-Henager, California College San Diego, and CollegeAmerica – were operating in “teach-out” status, each with less than 100 students yet to complete their programs. At that point, these colleges were in the process of closing and would do so once all of their students completed their programs or transferred.

IU has indicated it will appeal the ACCSC decision.

Accrediting agencies are voluntary, independent membership associations that serve as gatekeepers to federal student aid dollars. While the Higher Education Act (HEA) has specific requirements on what criteria an accreditor must consider when it evaluates a college – such as facilities, finances, and student outcomes – it is unclear what an agency must do when a college does not live up to those standards. [19]  Instead, the legislation is focused on ensuring due process for the institution before an accreditor acts to remove accreditation. For example, the HEA requires that agencies provide sufficient opportunity for an institution to respond to the accreditor about any deficiencies identified, the opportunity to appeal an action to remove accreditation, and the right to representation and participation by counsel during an appeal. In other words, it is designed to protect the institution from an unfair judgement that might cause it to lose accreditation.

Because accreditation provides colleges with access to federal aid, loss of accreditation could very likely mark the beginning of the end for a school’s existence. A focus on due process is understandable. However, there are no similar protections for accreditors when they take action, nor are there protections for the students attending colleges that are not up to standard.

Following an unsuccessful appeal, institutions can take accrediting agencies to court. While the accreditors usually win, fighting legal battles takes up valuable time and money. [20]  Accrediting agencies are small nonprofits, funded by colleges’ membership dues, with fewer staff and less funding devoted to oversight than what colleges’ corporate owners can devote to fighting back. For comparison, in a year, ACCSC’s stamp of approval authorized $2.3 billion in federal financial aid to 398 colleges, while the agency spent slightly more than $7 million overseeing colleges. [21]  The focus on due process in legislation and the threat of a court battle can make agencies reluctant to act swiftly.

Federal regulation provides a bit more clarity. It generally requires that if an institution or program fails to meet standards, the accrediting agency must provide them with a timeline for coming into compliance or risk losing accreditation. However the Trump administration introduced new regulations, which went into effect in 2020, that significantly weakened these standards. [22]  Previously, agencies were required to take immediate action to withdraw accreditation or provide time to come into compliance within a maximum of two years, depending on the program length. [23]  The new regulations, however, doubled the maximum timeline to four years, specifying that the agency must have a policy in place that allows it to immediately withdraw its stamp of approval when warranted.

Still, even with the maximum timeline of two years before the regulatory change, actions taken by ACCSC against CEHE demonstrate that noncompliance can occur over periods much longer than that; and even then, the agency did not withdraw accreditation. That is because each accrediting agency has a series of actions it can take when an institution is not in compliance with standards, based on the severity of noncompliance. Lower-level actions often do not have a standard timeline for compliance, and when they do, an agency might remove the action for demonstrated improvement, even if the college is not in full compliance. This flexibility allows accreditors to give colleges practically unlimited time, supposedly, to work on improvements – even though those improvements often never fully materialize. As the timeline below shows, on several occasions ACCSC issued a sanction indicating significant concerns only to remove the sanction or dial it back to a lesser action a few months later. And in the case of CEHE, it was clear based on ACCSC’s actions that the colleges it oversaw were not in compliance with the agency’s own standards for close to a decade.

To understand the actions taken against CEHE colleges it is necessary to look at ACCSC’s Standards of Accreditation. [25]  The commission has the ability to withdraw a college’s accreditation if that college fails to demonstrate compliance with one or more standards for any reason ACCSC deems sufficient. However, the standards include a long list of other available actions that range in severity and that the commission may take before moving to revoke accreditation.

The lowest level of action the commission can take is to defer a decision to another time, which is a way of saying that a college has yet to earn approval on a given issue. Deferring action is not an indication of noncompliance, but rather is used when the commission needs more information in order to make a decision. The commission may make a decision to accredit an institution with stipulations if there is evidence of deficiencies, but these deficiencies are generally issues that can be fixed within a short period of time.

The next level of actions is designed to monitor an institution and review information when there may be noncompliance. The commission can subject a college to heightened monitoring, which provides the ability for a more detailed review of information. It can also place a college on reporting to monitor compliance, which can include requiring that the college provide more information about outcomes, finances, or instances such as litigation reporting when it is facing a lawsuit.

One common scenario for which ACCSC uses reporting or monitoring is when a program falls below benchmark rates, a measure of the bare minimum level of acceptable student outcomes required by the commission on graduation, employment, or licensure pass rates. Failure to meet benchmark rates for a prolonged period of time may result in additional action at the program or institutional level, though the commission may also allow a college to demonstrate compliance through other supporting documentation or indicators. For example, a college may argue that poor economic conditions drove down employment rates. However, there is no hard-and-fast timeline for which institutions must demonstrate compliance with benchmarks – and reporting can go on over a long period of time, as was the case with CEHE. Some of the actions that ACCSC used to address the deficiencies included limiting enrollment in underperforming programs and revoking approval of a program to operate.

The most serious set of actions is available when the commission believes that the institution is out of compliance with standards. The first of these actions is a warning. Under a warning, the college is required to demonstrate a corrective action and compliance; it may also be required to inform students about the warning. The second action is probation, which is used when there are significant concerns regarding compliance with one or more standards. The commission has discretion to issue a probation without first issuing a warning. In more severe instances, the commission may also request that the college provide “show cause,” evidence that explains why the college’s accreditation should not be withdrawn. A warning or probation action may require additional reporting and an on-site visit of accreditor staff or reviewers to the campus.

Failure to demonstrate compliance by the end of the warning can result in loss of accreditation or another action, such as monitoring or probation. Failure to demonstrate compliance after a probation period results in loss of accreditation. Under a probation action, the college must inform current and prospective students.

The timeline below covers actions taken by ACCSC, lists some of the reasons the measures were taken, and includes actions taken by other regulatory bodies.

The timeline is divided into three parts. The first part covers actions from 2008 to 2012, when ACCSC issued actions indicating lower levels of concern. During this period, the colleges did not yet operate under the CEHE umbrella.

The second part covers actions from 2013 to 2017, when the colleges operated under the CEHE umbrella. These actions indicated that the problems identified during the earlier phase were much more widespread and severe than initially implied. This period also included numerous anonymous complaints and multiple actions from other regulators suggesting outright fraudulent activity.

The final period covers actions from 2018 to the present. During this period, ACCSC made clear that problems were severe and ongoing, existing across the system of schools operated by CEHE. While many of the early actions center on CollegeAmerica Denver, ACCSC has noted on numerous occasions – including in 2012, 2013, 2015, and 2018 – that the problems were systemic across CEHE’s campuses.

From 2008 to 2012, ACCSC took a series of escalating actions that started out with concerns over low graduation and employment outcomes in various programs at CollegeAmerica’s Denver (CA Denver) campus. [27]  CA Denver was the main campus for three branch locations: in Fort Collins and Colorado Springs, Colorado, and in Cheyenne, Wyoming. Under ACCSC standards, the accreditation of branch campuses is dependent on the accreditation of the main campus, which means that an action against the main campus applies to all locations. While the timeline refers to actions against the main campus, these actions typically included multiple campuses. [28]  In fact, ACCSC noted low outcomes with programs at all locations.

By 2012, after deferring accreditation, requiring outcomes reporting, and issuing a heightened monitoring for one location, ACCSC decided to cap enrollment in all CA Denver programs until the college could demonstrate acceptable levels of student achievement, noting at the time that the problems were systemic and ongoing. [29]  The agency also reviewed the CollegeAmerica chain for other concerns, including complaints received against the college and an action by a state agency considering whether to revoke authority to operate in the state of Colorado. [30]  As a result, it deferred a decision to renew accreditation.

From 2013 to 2017, after CEHE assumed ownership of the campuses, ACCSC took a variety of actions at both the systemwide and institutional level. In May 2013, the agency placed the entire system of colleges on “show cause” as to why their accreditation should not be withdrawn, noting potential systemic issues with recruitment, admissions, student achievement, advertising, state licensure, cohort default rates, and student success. [31]  However, by November, a mere six months after noting concern over whether there were systemic issues, ACCSC vacated – or removed – the show cause for all but the CA Denver location and its branches, noting a history of poor student outcomes. [32]  It is not clear whether ACCSC felt that the other systemic issues had been addressed, but it placed the system of colleges on advertising reporting so that it could continue to monitor the truth and integrity of the colleges’ advertising.

The intervening years included several lawsuits against the system on behalf of the U.S. Department of Justice and the state of Colorado alleging illegal recruiting practices and students being misled about the likelihood of earning more money and obtaining jobs following graduation. ACCSC took a variety of actions, including probation, warning, and litigation and advertising reporting; it also revoked approval of baccalaureate programs at CA Denver. [33]  On numerous occasions, ACCSC noted the failure of the colleges to improve graduation and employment rates. [34]  By the end of 2017, CEHE remained on reporting and CA Denver was on warning. [35]

In 2018, ACCSC issued the systemwide probation order that would ultimately lead to the withdrawal of accreditation in 2021. The probation order lists a long history of actions, with details from campuses across the various chains dating back years. Concerns included false advertising, bad enrollment practices, and students not meeting admissions criteria, among 18 different compliance problems. The probation order notes that the record shows that the colleges’ inputs, resources, and processes were not designed for student success, as evidenced by the widespread and persistent low rates of graduation and employment throughout the system. [36]

ACCSC also pointed to a disregard for the needs of students. In one case, CA Flagstaff even blamed its poor student achievement and low rates of student success on the Native American “culture” of its students, as two-thirds of those attending the campus were Native American. [37]

The next few years included escalating action from ACCSC, including ordering CEHE to cease enrollment in programs across multiple campuses that had low student success rates. [38]  And as CEHE began shifting its focus to online enrollment and closing campuses, it became the subject of a new investigation from the Consumer Financial Protection Bureau into whether the organization misrepresented loans to students or enrolled them in loans without approval. [39]  Later, a Colorado court ruling issued a $3 million judgement against CEHE, finding two executives personally liable for fraud – including misrepresenting earnings and employment rates to students. [40]

Perhaps intending to avoid triggering a sudden closure, ACCSC extended the timeline on probation to 2021, noting that CEHE was in the process of teaching-out physical campuses. [41]  Yet in April 2021, ACCSC voted to withdraw accreditation. CEHE is now appealing the ruling and has announced that it will not continue enrolling students during the appeal. [42]

In sum, ACCSC allowed a chain of colleges to siphon away $1.8 billion in taxpayer funding for financial aid even after questions had been raised. It allowed tens of thousands of students to put their quest for a better future into the hands of an incompetent – if not outright predatory – organization, wasting years of their lives, pouring money into tuition, and amassing debt they were ill-equipped to pay off. Even as it followed the rules ACCSC was able to prolong withdrawing accreditation from CEHE’s colleges.

During the course of 13 years, ACCSC had numerous opportunities – and an abundance of evidence it could have marshalled – to immediately withdraw accreditation, or at least provide CEHE a strict maximum of two years to improve. It could have ended accreditation in 2013 when it placed the system on show cause for systemic issues in recruitment, admissions, student achievement, advertising, state licensure, and cohort default rates. Instead, it dropped the action six months later, even though the problems continued with no real improvement.

ACCSC could have ended accreditation again in 2015 when it had CEHE on litigation and advertising reporting and issued a probation to CA Denver noting that student achievement problems had existed since 2008. The accreditor dropped the probation five months later.

ACCSC could have decided to withdraw accreditation at any point since 2018, when it issued probation and published 80 pages of detailed evidence of problems across the system. Instead, it extended the timeline further, even though the outcome was clear: there would be no improvement.

ACCSC should be investigated for its failure to act in a timely manner to protect students and taxpayers. But even more importantly, the rules that allowed for this failure must be changed. This includes reforming legislation that focuses on protecting institutions from losing accreditation instead of protecting students from colleges that do not meet standards, as well as establishing stronger guidelines and consequences for when accreditors must act. Moreover, it is necessary to strengthen regulations that were significantly weakened last year to provide colleges with more time when they do not meet standards. And the Department of Education must increase its oversight and take action against colleges when they continuously raise red flags.

Only when all of these reforms are instituted can taxpayers and students feel any confidence that the sorry story of ACCSC’s ineffectual oversight will not be repeated.

[Comment by ARI Watch:  No, the solution is simple and obvious. Get the federal government out of the student loan business.]


Endnotes1.  Michale S. McComis, Ed.D., “System-Wide Review Probation Order,” Accrediting Commission of Career Schools and Colleges, September 6, 2018.2.  State of Colorado v. Center for Excellence in Higher Education, findings of fact, conclusions of law, and judgment, Denver District Court, No. 2014CV34530 (August 21, 2020).3.  CAP analysis of 2014-15 academic year data from Federal Student Aid, “Title IV Program Volume Report,” available at
studentaid.ed.gov/sa/about/data-center/student/title-iv
(last accessed May 2021).6.  Center for Excellence in Higher Education, “Home.”7.  State of Colorado v. Center for Excellence in Higher Education, complaint, Denver District Court, No. 2014CV34530 (December 1, 2014).8.  Michale S. McComis, Ed.D., “Withdrawal of Accreditation,” Accrediting Commission of Career Schools and Colleges, April 22, 2021.9.  McComis, “System-Wide Review Probation Order.”10.  Ibid.; McComis, “Withdrawal of Accreditation”; U.S. Department of Education, “Database of Accredited Postsecondary Institutions and Programs.”11.  State of Colorado v. Center for Excellence in Higher Education, complaint.12.  Robert Shireman, “The Covert For-Profit: How College Owners Escape Oversight through a Regulatory Blind Spot” (New York: The Century Foundation, 2015).13.  Robert Shireman, “These Colleges Say They’re Nonprofit – But Are They?”, The Century Foundation, August 6, 2018; Dan Bauman and Michael Vasquez, “How a For-Profit Tycoon Turned His Colleges Into Nonprofits,” The Chronicle of Higher Education, April 12, 2020.14.  State of Colorado v. Center for Excellence in Higher Education, findings of fact, conclusions of law, and judgment.15.  Andrew Kreighbaum, “For-Profit College Phasing Out Enrollment at Physical Campuses,” Inside Higher Ed, September 12, 2019.16.  Michale S. McComis, Ed.D., “System-Wide Review Continued Probation Order,” Accrediting Commission of Career Schools and Colleges, July 21, 2020.17.  Andrew Kreighbaum, “For-Profit College Phasing Out Enrollment at Physical Campuses.”18.  McComis, “Withdrawal of Accreditation.”19.  Legal Information Institute, “20 U.S. Code § 1099b – Recognition of accrediting agency or association” (last accessed May 2021).20.  Antoinette Flores, “Getting What We Pay for on Quality Assurance” (Washington: Center for American Progress, 2017).21.  National Advisory Committee on Institutional Quality and Integrity, “Recognized Institutional Accreditors: Federal Postsecondary Education and Student Aid Data” (Washington: U.S. Department of Education, 2019); Internal Revenue Service, “Return of Organization Exempt From Income Tax: 990” (Washington: 2017).22.  Legal Information Institute, “34 CFR § 602.20 – Enforcement of standards”; Flores, “How the Trump Administration is Undoing College Accreditation.”23.  U.S. Department of Education, “Part 602 – Accreditation” (last accessed May 2021).25.  Accrediting Commission of Career Schools and Colleges, “Standards of Accreditation” (Washington: Center for American Progress, 2020).27.  Accrediting Commission of Career Schools and Colleges, “Public Notice of Probation as of December 14, 2015,” p. 30 (last accessed May 2021).28.  Ibid., p. 36.29.  Michale S. McComis, Ed.D., “School #M001507 Continued Warning,” Accrediting Commission of Career Schools and Colleges, February 12, 2018.30.  McComis, “System-Wide Review Probation Order.”31.  Accrediting Commission of Career Schools and Colleges, “Public Notice of Probation as of December 14, 2015,” p. 31.32.  Ibid.33.  McComis, “System-Wide Review Probation Order.”34.  Ibid., p. 32.35.  Ibid.36.  Ibid.37.  Ibid.38.  McComis, “System-Wide Review Continued Probation Order.”39.  Consumer Financial Protection Bureau, “Center for Excellence in Higher Education” (Washington: 2019).40.  State of Colorado v. Center for Excellence in Higher Education, findings of fact, conclusions of law, and judgment.41.  McComis, “System-Wide Review Probation Order.”42.  David Halperin, “Breaking: Citing Performance Failures, Accreditor Dumps Independence University,” Republic Report, April 23, 2021.