Last month the Department of Education (DOE) announced that it decertified the Charlotte School of Law for federal loan assistance, placing its future and the future of hundreds of its law students in jeopardy. In taking its action, the DOE cited the school’s repeated failure to meet American Bar Association (ABA) standards while making “substantial misrepresentations to current and prospective students about its standing and the “likelihood that its graduates would pass the bar exam.”

The DOE’s actions came in response to an action taken by the ABA a month earlier when it placed the CSL on probation, citing compliance issues around its admission policies and practices. The probationary notice specifically called out the school’s diminished standards for admitting applicants “who do not appear capable of satisfactorily completing its educational program and being admitted to the bar.” The ABA gave the school until December 15 to submit a plan that addresses their practices and policies for the next enrolling class.

The harsh actions came about as a result of the poor performance on recent bar exams by the school’s graduates. ABA standards require at least 75% of a school’s graduates must pass the exam in three of the five last calendar years. It also requires that the average first time passage rate of graduates is no more than 15 points below the average of all ABA accredited law schools in the same jurisdiction.

CFPB Shuts Down Student Loan Scammers

In the most recent test cycle, the passing rate for CSL graduates was 45%, which was the lowest in the state and 20 points below the state average. It was the lowest passing rate in a downward trend that started with the financial crisis of 2008. At the time, CSLs enrollment was around 1,400 students each paying around $60,000 a year in tuition.

When the bottom fell out of the legal industry as a result of the crisis, CSLs enrollment fell to about half. In order to boost enrollment, CSL was forced to lower its standards and recruit students who had less of a chance of passing the bar. Most of CSLs students qualified for federal student loans at up to 100% of school’s costs.

With classes scheduled to start on January 14, the status of CSL and its students is uncertain. The DOE’s action has cut CSL and its students off from millions of dollars in aid. Although the school has assured its students, the ABA and the DOE that it has a plan to get its policies, practices and its curriculum back to standard before the probationary period ends, its time and money may run out much sooner.