Chairman Scott Threatens to Subpoena Secretary DeVos for Documents Related to Department’s Role in For-Profit School Closure

Committee releases new documents revealing Education Department made multiple improper payments to Dream Center

WASHINGTON – Today, Congressman Bobby Scott (VA-03), chairman of the House Committee on Education and Labor, sent a letter to Department of Education Secretary Betsy DeVos threatening to subpoena documents regarding the Department’s role in the abrupt closure of Dream Center Education Holdings, a for-profit college chain that collapsed last year. The letter is Chairman Scott’s second request for documents and transcribed interviews that would shed light on the Department’s behind-the-scenes effort to prop up the struggling schools.

The deadline for the Department’s response is November 26, 2019.

“The Committee's requests and efforts to accommodate the Department have been made as part of the Committee’s efforts to conduct legitimate oversight of Department conduct concerning millions of taxpayer dollars and the lives of thousands of students. If the Department continues to refuse to respond, the Committee will then be forced to conclude that the Department is purposefully frustrating Congressional oversight for reasons that are not in the best interest of the American taxpaying public. Therefore, the Committee is left to consider utilizing the full powers at Congress' disposal to obtain these critical documents,” Chairman Scott wrote in a letter to the Department.

The Committee also released new documents today suggesting that the Department knowingly made improper and potentially illegal payments to two Dream Center owned schools when they were no longer accredited. According to the documents, rather than blocking access to taxpayer funding for the Art Institute of Colorado and the Illinois Institute of Art after they lost accreditation, the Department worked with Dream Center executives to “retroactively” convert the for-profit schools to non-profit schools, which would restore their eligibility for federal funding.

This information adds to the concerns raised in documents released by the Committee in July 2019, which suggest that the Department enabled Dream Center to mislead students regarding the accreditation status of the two Dream Center-owned schools. Those documents revealed that despite knowledge of Dream Center’s false claims of accreditation, the Department did not immediately require the for-profit company to take corrective action. Instead, the Department supported efforts to “retroactively accredit” the institutions in question by rewriting Department policy.

“The documents obtained by the Committee reveal that while the Department of Education was working behind the scenes to help Dream Center obtain so-called ‘retroactive accreditation,’ it was doing little to notify students that the school was at serious risk of closing,” said Chairman Bobby Scott. “In fact, the Department did not adequately communicate with Dream Center students between the time when they first learned about Dream Center’s troubles and the day before the schools abruptly closed. The Department’s decision to work with Dream Center executives, while keeping students in the dark, left thousands of students with crushing debt and few options to finish their education or enter the workforce.”

To read the letter, click here.

To better understand the Education Department’s involvement in the collapse of Dream Center Education Holdings, click here.


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