The Legal Beat
Troubled Law School May Hold Graduates’ Degrees Hostage, Hires Lobbying Group To Secure Federal Student Loans
Posted on Friday April 28, 2017
Imagine you’re about to graduate from law school in two weeks… but you still haven’t paid for your final semester. That’s what’s happening at the Charlotte School of Law, where students haven’t received any federal loan disbursements thanks to the Department of Education revoking the school’s access to the program in Dececmber.
Although the for-profit law school has repeatedly assured students that their loan funds would be released, that has yet to occur. In an interview with the ABA Journal, Matt Blevins, a third-year student, said the school would offer institutional loans to students if the federal loan money doesn’t materialize. If students fail to take those loans, however, Blevins says Charlotte Law may withhold their diplomas.
While this isn’t an uncommon practice, graduating Charlotte students have been placed in a very uncommon situation. Here are some additional details from the ABA Journal:
Many law schools have methods to make emergency loans to students, and universities generally require that students take care of unpaid fees before issuing a diploma, says Barry Currier, the ABA’s managing director of accreditation and legal education.
“That said, should a matter related to loans to students or the withholding of diplomas come to the accreditation committee or the council, it would be up to those bodies to evaluate the facts in light of the standards and determine whether a standards violation has taken place,” he wrote in an email to the ABA Journal.
In the meantime, perhaps in its hope to get its access to federal loans restored as quickly as possible, Charlotte Law has hired lobbyists from the Podesta Group to go to bat for the for-profit institution on “higher education issues” before the Senate, the House of Representatives, and the Department of Education. The law school paid a $50,000 retainer for these services. Click here and here to see their Senate disclosure forms.
It sure seems like the law school is putting in a lot of effort to prevent its school from closing — and to prevent itself from being on the hook for millions of dollars of federal loan discharges should the school close within 120 days of the vast majority of its students having withdrawn between December and January. Here’s some additional color from the North Carolina Attorney General Josh Stein on that issue:
“If CSL closes in Summer 2017 due to poor financial health, CSL’s investors and officers would be free to walk away; at worst, they would have lost the value of their investment,” the communication reads. “CSL’s students, on the other hand, would be left with debt they cannot discharge, incurred for a legal education of diminished value, which in many cases will not lead to their obtaining the professional qualification they sought at the outset of their studies.”
Are Charlotte Law’s lobbying efforts just another stalling tactic to save the school’s investors instead of the school’s students? Will Charlotte Law actually keep its graduates’ degrees hostage? Debt weighs heavy on law school graduates, but it weighs even heavier on law students whose futures hang in the balance.
Staci Zaretsky is an editor at Above the Law. She’d love to hear from you, so feel free to email her with any tips, questions, or comments. You can follow her on Twitter or connect with her on LinkedIn.