Florida Coastal School of Law disputes the findings released May 13 by the office of Federal Student Aid in the U.S. Department of Education denying the school’s reinstatement into the loan program.
The school’s dean says the decision not to reinstate Florida Coastal in the federal student loan program is a mistake and it will appeal the denial, according to a statement released May 14 by the law school.
“I was perplexed by the ED’s decisions and disagree on many points they made in the letter and press release,” said Peter Goplerud, Florida Coastal president and dean, in the release.
“In quotes released by the ED, they called us reckless and irresponsible with the students’ futures which could not be further from the truth. Our students are the sole focus of everything we are doing and always have been. We are putting together the factual evidence of the successes of our graduates and will be going point by point to refute the ED’s claims.”
The education department’s release about the denial states: “Today’s actions are part of a broader effort by ED to support the needs of America’s students and borrowers and hold for-profit institutions accountable if they fail to serve students well.”
The government said the denial is because the school’s student loan agreement with the department expired March 31, when required Florida Coastal School of Law officials refused to sign the contract, effectively ending the school’s participation in the federal student aid programs.
In early April, Florida Coastal School applied for reinstatement and was denied May 13.
The cost of tuition, fees and books at Florida Coastal is about $42,000 a year in the traditional three-year program, according to its website.
The department contends that Florida Coastal fails to meet financial responsibility, fiduciary and other standards required for participation in federal student loan programs.
The law school disagrees.
“FCSL believes they misread and mischaracterized critical parts of the audited financial statements. The school improved its financials between 2019 and 2020 and is on track to improve its financial position in the fiscal year 2021 as noted in the statements,” it states in the May 14 release.
“The audits for the fiscal year 2019 and 2020 stated the school’s plans would provide an improved financial position for the future, which it did between 2019 and 2020.”
The department also said the law school failed to inform the government of accreditation issues raised by the American Bar Association, which the school refutes.
“There have been instances over the years where compliance issues have been raised, but we have consistently rectified such matters. We are an accredited ABA school and we have adhered to the standards and regulatory requirements of the federal student financial aid programs,” Goplerud said.
If the law school’s appeal is denied by the education department, it will implement a teach-out plan to help students transfer to other law schools.
The ABA is reviewing Florida Coastal’s teach-out plan. A decision is anticipated this week.
At Florida Coastal, ABA scrutiny began in February 2017 when only 25% of the school’s graduates passed the Florida Bar exam.
The ABA conducted a 27-month investigation into whether Florida Coastal was meeting accreditation standards for admission requirements and curriculum.
It determined that Florida Coastal School of Law would remain an approved law school, but then questioned the school’s financial stability.
That investigation ended in February 2020 when the ABA found the school in compliance with standards that ensure that law schools are financially sound, a requirement for accreditation.
The student loan program denial is the latest action in the past 17 years since Florida Coastal became part of the InfiLaw consortium of for-profit law schools.
Sterling Capital, a private equity firm based in Naples, Florida, purchased Florida Coastal in 2004 and at the same time established the InfiLaw System.
InfiLaw founded the Phoenix School of Law (later renamed Arizona Summit School of Law) in 2004 and the Charlotte School of Law in 2006.
All three schools had issues with the ABA and Department of Education related to admission standards, below-average Bar exam passage rates and high levels of student debt combined with below average employment in the Bar percentages and income levels after graduation.
The ABA put Arizona Summit on probation for violating ABA academic and admission standards in March 2016. The school began a teach-out plan when its accreditation was withdrawn in July 2018. It closed in May 2020.
Charlotte School of Law was placed on probation in November 2016 for violating admissions standards required for ABA accreditation. The Federal Student Aid office terminated it from the student loan program a month later.
Charlotte School of Law closed in August 2017.
