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Argosy University closes its doors; students scramble to transfer


With the permission of their professors, psychology students at Argosy University in Chicago on Thursday grabbed books from the school library and from faculty members who were vacating their offices.

That afternoon in Tampa, Argosy students gathered for information about transferring their academic credits after the campus president warned of an imminent closure.

Similar scenes, according to students and faculty, played out at other Argosy campuses as the chain of 22 career schools stretching from Virginia to California closed Friday amid allegations of fraud. University staff and accreditation bodies are frantically working to give students paths to complete their degrees.

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“Everyone’s trying to help everyone, and our students trust us to try, but things are very confusing, ever-changing and sad,” said Deborah Lewis, a psychology professor at Argosy in Phoenix. “Our dean and I are trying to complete a dissertation defense with a student that was almost done. He’s in his tie presenting while security takes out the chairs from the room.”

Argosy has spent the last few weeks in a tailspin. The U.S. Education Department cut off federal student loan and grant funds last week after learning Argosy used $13 million owed to students to cover payroll and other expenses. Without the critical source of revenue from federal student aid, Argosy’s owner, Dream Center Education Holdings, had a slim chance of keeping the school open.

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By Wednesday, the court-appointed receiver for Dream Center, Mark Dottore, filed a motion warning that the university would close Friday if no one stepped forward to purchase the campuses. The court never approved the motion. Dottore, whose management of the receivership and relationship with Dream Center has angered creditors, may be removed from his post, according to court filings. Despite those loose ends, Argosy campuses are in shutdown mode.

Students, some of whom are months from graduating, are scrambling to find out which colleges will accept their academic credits. Although Dream Center posted a list of schools on its company website, Argosy had no such information.

Argosy’s accreditor, WASC Senior College and University Commission, plans to update its website with the names of institutions willing to absorb students or entire academic programs. So far, a dozen schools have contacted the commission indicating a willingness to absorb students, including the Chicago School of Professional Psychology, Alliant International University and Trident University International.

Several other colleges across the country have welcomed Argosy students, including Liberty University in Lynchburg, Va. The university is waiving application fees and offering students tuition discounts to complete their degrees online.

Although the commission had threatened to revoke Argosy’s accreditation as Dream Center’s financial condition deteriorated, WASC President Jamienne Studley said keeping the university in good standing was important for students.

“If we terminated Argosy right now, we fear that would cut off students’ ability to transfer or complete their programs,” said Studley, who served as deputy undersecretary at the Education Department under President Barack Obama. “We are prepared to work with Argosy to be as flexible as possible to do that in whatever time they can support those arrangements."

The commission is in talks with schools it accredits to accommodate Argosy students by, for example, accepting more academic credits than usual. But as the receiver rushes to shutter the schools, the commission’s support may be limited. Dottore informed all Argosy campuses late Friday that the university is effectively closed, without court approval.

“We understand the particular plight of students in their final term and had proposed to Argosy ways they might be able to help those students complete. However, we don’t know how this latest news will affect those options,” Studley said.

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The Education Department is keeping a running list of transfer fairs being hosted by state higher education agencies. The department began notifying Argosy students Friday that it will cancel their spring semester loans and update them about transfer options if the university officially closes.

“It was helpful to get information and have some answers,” said Niki Terranova, a doctoral candidate in psychology at Argosy in Phoenix, who received a notification. “But it also feels a bit behind the times. Like, they are saying this on the day the school is closing. I need to know: Who will take me to confer my degree? What is the DOE doing to make this easier for us?”

The Education Department has faced criticism for being unresponsive and ill-prepared to help Argosy students. A group of Democratic senators, led by Sen. Richard J. Durbin (Ill.), chastised the federal agency for failing to coordinate with Argosy’s accreditor to ensure a path for students to complete their studies — known as a teach-out plan — was in place when the university lost access to federal funds. Those plans typically include a list of comparable programs at other schools that have agreed to absorb students.

“The department’s failure to ensure over the last several months and weeks that Argosy had teach-out agreements in place has exacerbated the chaos for students,” the senators wrote in a letter Friday to Education Secretary Betsy DeVos.

The lawmakers urge DeVos to make sure that schools willing to accept Argosy students are in good financial and academic standing and not facing state or federal investigations or lawsuits. They want the Education Department to ensure that students will not be charged additional tuition and fees, and that transfer options will not exclusively include online institutions.