As of January 1, the Charlotte School of Law can no longer receive any federal loan money. In making the decision, the U.S. Department of Education says the law school has long been out of compliance with ABA standards and gave no hint of those problems to students.
Charlotte School of Law has been out of compliance with ABA standards since February of this year. Meanwhile, the U.S. Department of Education says the for-profit school not only kept students in the dark about its rocky status, but made "substantial misrepresentations to current and prospective students regarding the nature and extent of its accreditation and the likelihood that its graduates would pass the bar exam."
For example, on its homepage Charlotte School of Law still promotes that it's fully accredited by the ABA. The ABA specifically asked the school to take that down from its website in July and replace it with the noncompliance findings. In November, the ABA placed Charlotte School of Law on probation.
At issue is the school's low passage rates for the bar exam - just 45 percent this year - and the acceptance of unqualified students. To support this, the U.S. Department of Education points out, in 2016, 37 percent of the school's first year students dropped out because of academic reasons alone. That's the highest in the country. The school with the second highest rate is Florida Coastal, which is owned by InfiLaw, the same company that owns Charlotte School of Law.
"This might be the death knell for Charlotte School of Law because of how important federal student loan dollars are for the operation of the law school," says Kyle McEntee, who heads the group Law School Transparency.
The Department of Education says last year 946 Charlotte School of Law students received federal loans, netting the school $48.5 million in federal dollars. The loss of federal loans is what did in another for-profit school, ITT Tech.
In a statement, Charlotte School of Law said the school is working "intensively" to respond to the department of education and "protect our students."