The decision to remove recognition from ACICS stands to impact more than 600,000 students.
Accreditation agencies are essentially gatekeepers of federal dollars. They review of courses and programs to ensure a school meets their educational standards, which then makes a school eligible to accept federal student aid.
The ED's move on ACICS stands to impact 245 schools accredited by the agency and more than 600,000 students.
Barmak Nassirian, director of federal relations and policy analysis at the American Association of State Colleges and Universities, believes the move exposes additional questions about the quality of the 245 schools ACICS reviewed.
"If ACICS was found to be so lacking in judgment that the federal government decided to expel it and no longer recognize it, what does that say about the quality of the other schools other than Corinthian and ITT?" Nassirian questioned in an interview with Business Insider.
Corinthian College, one of the largest for-profit systems, shuttered in 2015 after investigations into abuses of students and subpar courses. ITT Tech, which closed in September, faced similar criticism over the quality of programs before its demise.
"Far beyond the possibility, I would say there is a high probability that many of the existing institutions that haven't gone out of business and that have access to federal aid through ACICS are significantly subpar and quite risky to both students and taxpayers," he continued.
The remainder of ACICS-accredited schools are mostly for-profit institutions, some of which, have also faced investigations by law enforcement over business practices.
Education Management Corporation (EDMC), for example, is the parent company of two for-profit colleges with campuses accredited by ACICS: The Art Institutes and Brown Mackie College. EDMC has faced investigations by state attorneys general and the US Justice Department.
In April, the National Advisory Committee on Institutional Quality and Integrity along with 13 state attorneys general wrote a letter to the ED urging it not to renew recognition for ACICS. The letter stated that ACICS systemically failed students by accrediting subpar schools:
"ACICS's accreditation failures are both systemic and extreme. Its decisions to accredit low-quality for-profit schools have ruined the lives of hundreds of thousands of vulnerable students whom it was charged to protect. It has enabled a great fraud upon our students and taxpayers."
A spokesperson for ACICS told Business Insider that the corporation has been working improve standards, policies, and procedures and that there have been changes in its governance and leadership.
ACICS has appealed the ED's decision and has a month to prepare an argument for reconsideration.