Justice Reportedly Drops 25 Colleges From Inquiry

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WASHINGTON--The Justice Department reportedly has notified 25 colleges and universities that it is no longer investigating them for possible violations of antitrust laws in connection with the sharing of tuition and financial-aid information.

Officials from the 25 institutions-primarily private, liberal arts schools--said the Justice Department recently sent them a brief letter indicating that their schools had been dropped from the investigation, according to reports in The Chronicle of Higher Education.

A Justice Department spokesman confirmed that the department had closed its inquiry at numerous institutions. But, the spokesman said, other schools still are being probed, and the focus of the investigation remains the same.

The spokesman refused to identify the schools still under investigation or those that have been dropped from the probe.

The investigation began in 1989 when the Justice Department alleged that the schools, in particular 23 selective private colleges in the Northeast, illegally conspired to limit price competition by offering similar financial-aid packages to prospective students.

Over all, according to The Chronicle, 57 institutions have been investigated.

The 23, known as the overlap group, had met annually to compare financial-aid awards. They said the meetings allowed the institutions to direct more aid to the neediest students by preventing a bidding war for top graduates.

Last May, eight Ivy League institutions, facing a Justice lawsuit alleging that they violated the Sherman Antitrust Act, agreed to stop sharing information on student financial aid. The Massachusetts Institute of Technology refused to sign the decree and is challenging the suit. (See Education Week, May 29, 1991.)

'Costly' Compliance

Officials at two of the colleges cleared said the Justice Department never indicated why their institutions were included in the investigation, and added that the recent letter simply said they were dropped from the inquiry.

"It seemed at some point in time there was no clear structure to the investigation," said Jim Mann, a spokesman for Antioch College in Yellow Springs, Ohio.

"It was a lot of work," he said. "It will be costly."

Richard F. Rosser, the executive director of the National Association of Independent Colleges and Universities, said the investigation "quite obviously led the Justice Department nowhere" in the case of the institutions absolved.

Some of those colleges and universities have spent as much as $200,000 on lawyers' fees alone in complying with the Justice Department investigation, Mr. Rosser said.

Vol. 11, Issue 22, Page 30

Published in Print: February 19, 1992, as Justice Reportedly Drops 25 Colleges From Inquiry
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