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Focus on Regulation

Regional Accrediting Agency Proposes Ban on Paying Recruiters of International Students

On March 27, the Middle States Commission on Higher Education (“Middle States”) released for public comment a draft policy on its expectations for honesty and truthfulness in published information and in student recruitment practices. Among other things, the policy would prohibit Middle States-accredited institutions from paying commissions to agents to recruit international students. Middle States is accepting public comment on the policy through April 17, 2017.

The draft policy is notable because it would extend the U.S. Department of Education’s (“ED’s”) prohibition on paying incentive compensation based on success in securing enrollments or the award of financial aid by institutions participating in the Title IV federal student aid programs, commonly known as the “incentive compensation rule,” to all Middle States-accredited and candidate institutions regardless of their participation in the Title IV federal student aid programs and regardless of whether recruitment is targeted at domestic or international students. The policy would apply to both institutional and independent recruiters.

Middle States is the regional accrediting agency with oversight of colleges and universities located in Delaware, the District of Columbia, Maryland, New Jersey, New York, and Pennsylvania, plus Puerto Rico and the U.S. Virgin Islands. Although ED’s incentive compensation rule prohibits institutions that participate in the Title IV federal student aid programs from paying incentive-based compensation for the recruitment of U.S. students, that prohibition does not extend to the recruitment of international students who are not eligible for federal student aid. In explanation for the proposed policy change, Elizabeth H. Sibolski, Middle States’ president, said the accrediting agency “believes that the principles underlying [the incentive compensation rule] should apply to all students equally. Thus, our policy would apply in all cases.” Some critics of the proposed policy change have suggested that if the policy is adopted, institutions will have to change recruitment practices in ways that will diminish international student enrollments and will require them to cancel or modify existing contracts with recruiters.

The question of whether institutions should be permitted to pay recruiters of international students is not a new one. In the past, the National Association for College Admission Counseling (NACAC) prohibited the practice, but NACAC lifted its ban on the practice in 2013 after several years of debate. At this time, Middle States is the only one of six regional accrediting agencies that has proposed to institute a ban on paying commissions to recruit international students. The Middle States proposed policy is open for public comment until April 17, 2017. Middle States will review public comments and may make revisions to the draft policy. Any revised policy approved by the Middle States governing body would be placed on an electronic ballot for voting by the chief executive officers of Middle States member institutions.