Education Dept. Cuts Off Funds to Union Institute

Inside Higher Ed

Katherine Knott

November 27, 2023

The Education Department is taking emergency action against Union Institute & University, an online college based in Cincinnati on the brink of collapse, according to news reports.

WCPO, a television station in Cincinnati, reported the institution’s access to federal financial aid has been terminated in part for mismanagement of federal funds. The department also is fining Union Institute $4.3 million. The college was given until Nov. 27 to appeal the enforcement action.

The college’s failures in administering federal funds “creates serious risks that the funds will continue to be misused in the future,” the department wrote in a Nov. 7 letter to the college, as reported by WCPO.

The department wrote that the college failed to pay students more than $750,000 in student loan refunds, hasn’t processed payroll for employees since Aug. 11 and took $43,524 more in federal financial aid than it needed.

The embattled college has been under state and federal scrutiny. The Ohio Department of Commerce’s Division of Industrial Compliance opened an investigation over wage complaints. The Education Department also required the college to establish a $12 million line of credit before Oct. 13 or lose access to federal financial aid. The department said in the Nov. 7 letter that the college didn’t meet that requirement, WCOP reported.

Union Institute officials haven’t publicly responded to the department’s letter.

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