Dive Brief:
- Union Institute & University has appealed the U.S. Department of Education’s decision to fine it $4.3 million and cut off its access to federal financial aid, an agency spokesperson confirmed Monday.
- The Education Department has accused Union Institute of taking in roughly $43,500 more in Title IV financial aid than it was entitled. This compounds the private Ohio nonprofit's financial troubles as it faces lawsuits alleging it missed payroll and rent payments.
- Losing Title IV money could deal a fatal blow to Union Institute. The university did not respond to a request for comment Tuesday.
Dive Insight:
Union Institute has grabbed headlines all year after its employees began complaining publicly that they weren’t receiving their paychecks. In April, a Union Institute employee filed a class-action lawsuit over the missed pay. The case is ongoing.
Its enrollment had also tumbled from 1,666 students in fall 2012 to 787 in fall 2022, according to federal data.
But the Education Department argues Union Institute’s problems run much deeper. The agency said in a letter last month that the institution had once again stopped paying its employees, this time since August.
The college also abused federal student aid, earmarking some of it to cover other types of expenses, the Education Department alleged.
By law, Union Institute needed to pay students or parents any surplus federal financial aid after applying tuition and other fees. But the university instead tapped that money to pay for the institution’s own expenses, the Education Department said.
Further, the institute took out $43,500 more in financial aid than it needed, most of which it has not paid back, the agency said.
Union Institute has maintained it will remain open, despite the turmoil. The college’s website advertises for classes starting in January.
