ABA-Accredited Law Schools Reach Settlements with Education Department Regarding Improper LLM Student Aid Disbursement

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In a recent development in the legal education landscape, five stand-alone law schools, all accredited by the American Bar Association (ABA), have entered into settlement agreements with the U.S. Department of Education. These agreements stem from allegations of disbursing federal financial aid to Master of Laws (LLM) students without the necessary accreditation. It’s important to note that the settlements do not constitute an admission of wrongdoing or liability on the part of the law schools.

The crux of the matter revolves around accreditation oversight for law schools offering programs beyond the traditional Juris Doctor (JD) degrees. ABA-accredited law schools seeking to provide programs other than JD degrees must obtain acquiescence from the council of the ABA Section of Legal Education and Admission to the Bar. However, ABA oversight only extends to JD programs, leaving non-JD programs without ABA accreditation.

According to the Education Department’s news release, additional accreditation covering Title IV requirements is required for freestanding law schools with ABA accreditation to disburse federal student aid for non-JD programs.

  

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The Education Department’s investigation revealed that nearly $2.9 million in ineligible disbursements were made to 92 students between July 2017 and June 2022. The agency calculates liabilities for ineligible loans using an estimated loss formula. However, the schools are not expected to reimburse the agency for the full amount disbursed.

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Here is a breakdown of the improper disbursements and corresponding liabilities for the five law schools involved:

1. Atlanta’s John Marshall Law School: Improperly disbursed $20,000 and paid $1,400 in liabilities.
2. Albany Law School in New York: Improperly disbursed $61,000 and paid $6,200 in liabilities.
3. New England Law in Boston: Improperly disbursed $68,000 and paid $4,200 in liabilities.
4. New York Law School: Improperly disbursed $610,000 and paid $54,500 in liabilities.
5. Brooklyn Law School in New York: Improperly disbursed $2.1 million and paid $193,000 in liabilities.

As part of the settlement agreements, these law schools have committed to ceasing the disbursement of federal aid funds to students enrolled in ineligible programs. They have also agreed not to seek reimbursement or recoup the amounts paid from affected or former students.

Of the five law schools, Brooklyn Law School released a statement asserting that it has implemented policies and procedures for its LLM program to ensure compliance with the law. Furthermore, the school is actively pursuing accreditation from the Middle States Commission on Higher Education for its LLM program.

Atlanta’s John Marshall Law School also issued a statement, emphasizing its commitment to rigorous policies and procedures aimed at full compliance with all Title IV requirements.

It is worth noting that advanced legal studies degrees designed for non-lawyers are also required to obtain acquiescence at ABA-accredited law schools, although they do not fall under ABA oversight. The nomenclature for such programs may vary from one law school to another.

The ABA website provides a list of law schools offering degrees in advanced legal studies and specifies which schools offer such programs. Among the five law schools that reached settlements with the Education Department, Albany Law School and Brooklyn Law School offer advanced legal studies programs.

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A spokesperson for Albany Law School clarified that its advanced legal studies program possesses accreditation from the Middle States Commission on Higher Education. Meanwhile, a spokesperson for Brooklyn Law School explained that its Master of Legal Studies programs had not yet launched or enrolled students, and thus were not subject to the Education Department’s inquiry.

These settlement agreements highlight the importance of proper accreditation and compliance with Title IV requirements in disbursing federal student aid. While the law schools involved have taken steps to rectify the situation and prevent future violations, the case serves as a reminder of the regulatory oversight necessary to safeguard the integrity of financial aid programs in legal education.

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