Top-rated universities are illegally conspiring to curb financial aid offers, the lawsuit says

Diving overview:

  • A group of former undergraduates is suing 16 top-rated private non-profit universities including Yale University, Georgetown University and the Massachusetts Institute of Technology they claimed to be involved in a pricing system that favored rich bidders and increased the price of the university.
  • Federal law allows universities to work together on their financial aid samples, but only if they are institutions blind to the needs, which means that they do not take into account the ability of potential students to pay when deciding on admission. Litigation, filed this week in the U.S. District Court for the Northern District of Illinois, claims that at least nine schools were not eligible for this exemption because they supported rich applicants when deciding on admissions and therefore are not actually need-blind.
  • Although the lawsuit does not say whether the remaining seven universities are indeed blind, they claim that they are not covered by the exemption for blind institutions because they have conspired with other universities. He asks the court to grant the lawsuit the status of a class action, to make universities liable for damages and to permanently forbid them to conspire about their pricing and financial aid policies.

Diving statistics:

All 16 universities named in the lawsuit are current or former members of the 568 Presidents Group, a group formed in 1998 by more than two dozen university leaders to work together on a needs-based financial assistance system. The name refers to the part of federal law that allows colleges to collaborate on financial aid samples.

The case is the latest concussion to hit admission practices at selective colleges. Recent Varsity Blues scandal, in which wealthy parents have secured places for their children through fraudulent sports profiles and bribes to college officials, revealed how families with good heels can manipulate admission practices. And the US Supreme Court is considering accepting the challenge racially aware admission policies at Harvard University and the University of North Carolina at Chapel Hill.

This week’s lawsuit alleges that universities are violating federal law by participating in a group of 568 presidents because not all of their admissions systems need to be blind. Other named institutions are Brown University, California Institute of Technology, University of Chicago, Columbia University, Cornell University, Dartmouth College, Duke University, Emory University, Northwestern University, University of Notre Dame, University of Pennsylvania, Rice University and Vanderbilt University.

Student lawyers say these institutions maintain admission systems that favor children of past or potential prospective donors or favor queue applicants who will not need financial assistance. He gives the example of Vanderbilt, who gave in a web post from 2018 that it retains the right to “be aware of the need to admit students on the waiting list”.

Some other schools are involved in enrollment management, a practice that, according to the lawsuit, uses secret techniques to help form cohorts of admitted students in order to maximize income and reduce financial aid offers.

Working together on their financial aid samples, these institutions have focused on reducing competition with each other and inflated the cost of attendance for students who need financial assistance, the lawsuit claims.

According to the lawsuit, the group of 568 presidents meets at least twice a year. One member, Yale University, temporarily withdrew its membership in 2007 because the group’s policy limited the financial assistance it could offer students, the lawyers said. Harvard refused to join the group due to similar concerns, with one former administrator saying it was because membership would reduce the financial packages she could award.

Universities, on the other hand, have raised more than 170,000 recipients of financial aid by “at least hundreds of millions of dollars,” the lawsuit said. It claims compensation for students who enrolled in higher education programs at certain times starting in 2003, received financial assistance as needed from one of the institutions, but still paid tuition or accommodation and meals.

Several named universities defended their policies on Monday.

A Caltech spokesman declined to respond to the allegations, but said officials were convinced of the university’s financial aid practices. A spokesman for Yale similarly said the university’s financial aid policy was “100% in accordance with applicable laws.”

A spokesman for Brown said on Monday afternoon that the university had not yet received a lawsuit, but was ready to work against the complaint. “Brown is fully committed to accepting admissions for U.S. college applicants regardless of their ability to pay tuition, and we meet the fully proven financial needs of those students who are matriculating,” the spokesman said in an email statement.

568 The Presidents Group has many of the same members as the now defunct Overlap Group, a group of universities accused in the early 1990s of agreeing on uniform financial aid offers for students admitted to more than one member of the group. institutions. These universities have concluded a decree of approval with the US Department of Justice, which has promised not to cooperate in determining what assistance they offer to certain students.

The new lawsuit also comes several years after the U.S. Department of Justice threatened the National Association for College Admission Counseling with ongoing legal action, arguing that the industry group’s code of ethics restricts competition between universities and could reduce costs for students if removed. NACAC voted in 2019 remove identified policies and increase competition between universities for students.

U of Chicago, Cornell, Dartmouth, Duke, Emory, U of Pennsylvania and Rice declined to comment on the lawsuit. MIT said it would review the application and respond in court.

Vanderbilt and other universities named in the lawsuit on Monday did not comment immediately.


Leave a Reply

Your email address will not be published. Required fields are marked *