MEMORANDUM

Date: February 11, 2022

To: U.S. Department of Education 

From: Jessica Ranucci and Johnson Tyler, Negotiators for Legal Assistance Organizations That 

Represent Consumers

Re: Issue Paper 1 – Ability to Benefit

We appreciate that the Department is seeking to establish minimum standards and certification 

procedures for eligible career pathway programs (“ECP Programs”) offered by institutions to 

students who lack a high school diploma or equivalent. In order to ensure that these students are 

protected from false certification abuses and are offered high-quality programs that provide the 

training necessary to succeed in specific in-demand occupations, we propose the following 

modifications to the Department’s most recent proposal.

1) Require Training from Adult Education Providers that Offer Valid High School 

Diplomas or GEDs: To avoid the fraudulent use of bogus high schools, we propose 

that the Secretary require that the component of an ECP Program that must enable an 

ATB student to obtain a high school diploma or equivalent be provided by a public 

secondary school, a regionally accredited secondary school, or an adult education and 

literacy provider eligible under 34 CFR §463.1, or a secondary school recognized as 

providing a valid high school diploma or its equivalent by the state or a public school 

district in which the student resides. These requirements should apply to all three 

eligibility processes provided for in proposed 34 C.F.R. § 668.32.

2) ECP Program Must Be an Integrated Education and Training Program: In order to 

ensure that students receive targeted, high-quality training that will lead to an indemand occupation, as intended by Congress, we support the February 1, 2022 

proposal of David Socolow to limit ATB eligibility to programs that provide 

coordinated Workforce and Innovation and Opportunity Act of 2014 (WIOA) Title II 

and Higher Education Act (HEA) Title IV Partnership coursework within an 

Integrated Education and Training (IET) program. These requirements should apply 

to all three eligibility processes in proposed 34 C.F.R. § 668.32.

3) Same ECP Program Requirements Should Apply Regardless of Approval Process: 

Proposed § 668.1157(b) should be clarified to state that the Department shall apply 

the standards in § 668.157(a) to verify the eligibility of ECP Programs that do not 

enroll students through a state-approved process. 
Issue Paper 1—ATB Proposal

February 11, 2022

Page 2 of 8

Introduction

From the 1980s through July 1, 2012, many for-profit institutions engaged in aggressive schemes 

to falsely certify the ability-to-benefit (ATB) of thousands of students without high school 

diplomas in order to maximize Title IV revenues. The Department has extensive evidence of 

common fraudulent schemes, including (1) faking ATB test results; (2) providing test answers to 

students; and (3) permitting students to retake a test multiple times until they pass.

1 After July 1, 

2012, when Congress repealed the ATB eligibility provision, many institutions found fraudulent 

means to continue to falsely certify these students. They often (1) stated on students’ electronic 

FAFSAs, without their knowledge, that the students had a high school diploma or GED when in 

fact they did not or (2) facilitated the provision of invalid high school diplomas while falsely 

representing that these diplomas were valid to both the government and the students.

2

The ATB provision was reenacted in modified form as of July 1, 2014. It includes a new

requirement that ATB students be concurrently enrolled in narrowly defined ECP Programs. 

Despite the well-documented history demonstrating the for-profit institutions’ ability to adapt

their fraudulent ATB schemes to changing legal requirements, the Department has allowed 

institutions to offer ECP Programs with no oversight or minimum standards for over seven years. 

As a result, legal aid organizations are starting to see for-profit college abuses.

A legal aid client in Los Angeles, Ernesto Alvarez,3 never finished high school or earned a GED. 

Starting when he was 29 years old, Mr. Alvarez attempted on two separate occasions, in 2011 

and 2014, to earn his high school diploma through adult education programs offered by the 

public school district. He dropped out of both programs because the classes were too difficult. 

In 2016, Mr. Alvarez searched online for an education program that could lead to a new career 

and better life for himself and his family. He came across an advertisement for a for-profit 

college chain and entered his contact information. Almost immediately, he began receiving calls 

from the college and eventually visited the campus. 

1 In 2017, for example, the Department agreed to group false certification discharges for as many as 36,000 students 

who attended the Wilfred Academy of Hair and Beauty Culture and Robert Fiance between 1986 and 1994, based on 

ATB abuses. Patricia Cohen & Emily Rueb, U.S. To Help Remove Debt Burden for Student Defrauded by ForProfit Chain, NEW YORK TIMES (Aug. 9, 2017). 2

In 2016, for example, the Department cut off financial aid to 23 campuses of the Marinello Schools of Beauty after 

determining that the school had engaged in a scheme to procure invalid high school diplomas for students who were 

otherwise ineligible for federal financial aid. Samantha Masunaga & Chris Kirkham, Marinello Schools of Beauty

abruptly shut down after federal allegations, LOS ANGELES TIMES (Feb. 5, 2016). As another example, in 2015, the 

Department of Justice indicted the owners of FastTrain College in Miami for allegedly obtaining federal financial 

aid by misrepresenting to the government that 1,300 students were high school graduates. See Second Superseding 

Indictment, U.S. v. Amor, U.S. Dist. Ct., S. Dist. of Fla., Case No. 14-20750-CR-LENARD (Sept. 29, 2015). 3 This name has been changed to protect the privacy of the borrower.
Issue Paper 1—ATB Proposal

February 11, 2022

Page 3 of 8

During the campus tour, the recruiter pitched an 8-month dental assistant program. Mr. Alvarez 

told the recruiter that he was worried about his ability to successfully complete such a program. 

He explained his impression that only “smart people” could be dental assistants. He also shared 

that he did not have a high school diploma and had dropped out of two adult diploma programs 

because they were too difficult for him. The recruiter and at least four other college staff assured 

Mr. Alvarez that he was smart enough to succeed in the dental assistant program. Mr. Alvarez

felt like these recruiters, and their school, understood his needs and was impressed with the 

dental facilities, the promises of hands-on training and lab time, and the promises that he would 

have no problem getting a job as a registered dental assistant upon graduating. After he took an

ATB exam, which the college told him he passed, he enrolled immediately. He was happy and 

proud because he had finally made it to college.

The college enrolled Mr. Alvarez in an ECP Program. The school required him to successfully 

complete an online GED program offered by a separate busines, called C4L Academy, while 

attending dental assistant classes. The college provided a room of computers where he and other 

ECP Program students could drop in at any time, login to the GED program, and work through 

19 different modules. They were required to pass a final test once a week for each module, 

before moving onto the next one. Because the online sessions were limited to one hour, Mr. 

Alvarez never had enough time to finish the computer assignments, which he often could not 

understand. Neither the college nor C4L Academy offered him much content-based assistance 

with his GED program. Instead, one college employee was responsible for making sure that the 

ECP Program students signed in at the GED computer room and offered assistance when she 

could. Because this employee was overwhelmed by the number of students she had to attend to, 

she rarely helped Mr. Alvarez. Although he met occasionally with an advisor, the advisor

focused on his attendance, punctuality, and the modules he still needed to complete in order to 

graduate, rather than on helping him learn from and successfully complete his online modules. 

Although Mr. Alvarez was told that he had failed some modules, Mr. Alvarez passed his GED 

classes according to a transcript for the GED program.

4

 Despite this, neither the college nor C4L 

Academy gave him a GED or high school diploma.

Although Mr. Alvarez found the dental assisting classes extremely difficult, he graduated. Mr. 

Alvarez then discovered that the dental assistant program did not in fact qualify him to be a 

registered dental assistance, which requires 15-months of dental assistant work to establish

eligibility to take the registration exam. Despite this, he submitted over 20 applications for 

dental assistant positions at dental offices. Although he was hired for three trial period jobs, all 

three fired him because he lacked the skills necessary for the job. Other than this, Mr. Alvarez 

has never worked as a dental assistant. Mr. Alvarez is unemployed and struggling to pay down 

his student loan debt, which amounts to over $16,000 in federal student loans and a $3,100 

private student loan. 

4 A copy of the C4L Academy transcript for Mr. Alvarez, along with a disclosure regarding the ECP Program from 

the college, is attached hereto as Exhibit A.
Issue Paper 1—ATB Proposal

February 11, 2022

Page 4 of 8

1. Require Training from Adult Education Providers that Offer Valid High School Diplomas or 

GEDs:

According to public records, including from the California Department of Education, C4L 

Academy is a for-profit sole proprietorship established in 2015. It is not accredited by a regional

accrediting agency recognized by the U.S. Department of Education. Because it is not regionally 

accredited, it is unclear whether C4L Academy diplomas are recognized as valid by public 

school districts or colleges.

In order to protect vulnerable ATB students from fraud and ensure that their investments in ECP 

Programs will pay off for themselves and taxpayers, it is incumbent on the Department to ensure 

that top-notch educational entities provide the high school diploma or GED component of ECP

Programs. Colleges with ECP Programs should be required to partner with an entity that has a 

demonstrated and successful history of (1) evaluating and providing basic skills and literacy 

training to adults; (2) teaching adult students the skills and knowledge expected of high school 

graduates; and (3) awarding adult students valid high school diplomas or an equivalent. 

Unfortunately, most states do not license or otherwise determine which high schools or adult 

programs provide valid high school diplomas. For the purpose of evaluating whether a college 

properly certified a student’s eligibility for financial aid, however, the Department applied a 

policy for determining the validity of a high school diploma. This policy could serve equally well 

here, with some modifications.

In a Final Program Review Determination from 2015 regarding the closed for-profit college 

ICDC, the Department determined that high school diplomas from an online school called 

Century High School were invalid for the purpose of establishing financial aid eligibility. Based 

on this determination, the Department ordered the college to return the Title IV funds paid on 

behalf of students with Century High School diplomas who did not pass ATB tests. It stated:

With respect to a determination that a high school diploma is considered valid, the 

Department relies on a state’s authority in this regard. In the absence of a state’s 

determination that a high school is legitimate, we rely on a local education 

agency’s determination. The State of California is silent on whether specific 

private high schools are recognized or provide recognized high school credentials. 

Therefore, the Department, in this case, relies on the Los Angeles Unified School 

District (LAUSD), in its capacity as the local education agency, to determine 

whether a high school credential is legitimate. With respect to Century High 

School (and other select schools), the LAUSD has determined the school does 

‘not meet the standard of equivalency to a recognized high school diploma . . . .’ 

(from LAUSD website). . . . ICDC either knew or should have known that 

Century High School diplomas are not valid high school credentials and failed to 
Issue Paper 1—ATB Proposal

February 11, 2022

Page 5 of 8

live up to its fiduciary duty to assure that only eligible students received Title IV 

assistance.5

We propose that the language proposed by the Department for 34 C.F.R. § 668.2(b)(6) be 

modified as follows to include similar requirements for ECP Programs:

§ 668.2 General definitions.

. . . 

(b) Eligible career pathway program: A program that combines rigorous 

and high-quality education training and other services that –

. . . 

(6) Provides training by a secondary school or adult education and literacy 

provider eligible under 34 C.F.R. § 463.1 that Eenables 

an individual to attain a secondary school diploma or its recognized 

equivalent, and at least one recognized postsecondary credential;. For the

purposes of this section, the secondary school or other entity providing the 

training for a secondary school diploma or its recognized equivalent must 

be a public secondary school, a private secondary school with regional 

accreditation, an adult education and literacy provider eligible under 34 

C.F.R. § 463.1, or a secondary school recognized as providing valid high 

school diplomas or their equivalent by the state or the public school 

district where the student resides. The entity offering the training must 

have a demonstrated record of providing high school diplomas or a 

recognized equivalent to students not enrolled in eligible career pathway 

programs.

A similar change should be made to the Department’s proposal in 34 C.F.R. § 668.157(a)(6). 

This section, as currently drafted, refers to 34 C.F.R. § 668.16(v) for a definition of a valid high 

school diploma. There is, however, no 34 C.F.R. § 668.16(v). We therefore propose the 

following amendment:

§ 668.157(6) Eligible Career Pathway Program.

(a) An institution demonstrates to the Secretary that a student is enrolled in an 

eligible career pathway program, as required under 668.156(a)(3) of this part, by 

5 See pp. 5-6 of the Final Program Review Determination, attached hereto as Exhibit B. Unfortunately, we are not 

able to provide a more legible copy, as this is what was received from the Department in response to a FOIA 

request.
Issue Paper 1—ATB Proposal

February 11, 2022

Page 6 of 8

documenting a partnership between adult education and a postsecondary 

institution providing that:

. . .

(6) The program is designed to lead to a valid high school diploma or its 

equivalent as defined in § 668.216(v) of this part or its recognized equivalent.

2. ECP Program Must Be an Integrated Education and Training Program

The ECP Program described in the example above was not the kind of program that Congress 

intended for ATB students. As described in David Socolow’s proposal memo, Congress intended 

ECP Programs to be narrowly construed as intensive, hands-on IET programs designed to 

provide adult education and literacy activities together with workforce preparation and training 

for very specific occupations, along with other workforce preparation activities that are often the 

first step on low-wage, low literacy workers’ career pathways.

It is unlikely the college above did research that led to a determination that the dental care 

industry in California or the regional economy was in need of, and unable to find, sufficient 

numbers of skilled dental assistants.6

 While the college provided some counseling, it did not 

provide the counseling most needed by Mr. Alvarez – tutoring to help him master his on-line 

high school and dental assistant classes and counseling to help him achieve his career goals.7

Neither the dental assistant program, nor the GED program offered by C4L Academy, were

“organize[d] . . . to meet the particular needs of [Mr. Alvarez] in a manner that accelerates the 

educational and career advancement”8 of Mr. Alvarez. Mr. Alvarez received no special tutoring. 

Neither the college nor 4CL Academy evaluated his literacy or potential learning challenges in 

order to craft a specialized joint high school diploma and dental assisting program that would 

allow him to succeed in his programs and as a dental assistant. Indeed, Mr. Alvarez’s C4L 

transcript lists courses such as “Introduction to Literature,” “World History and Geography,” 

“Earth and Space Science,” and “Physical Education” – none of which addressed Mr. Alvarez’s 

history of difficulty understanding adult high school diploma courses or helped him to attain the 

basic high school knowledge necessary to successfully stay in a dental assisting job.

9

 

High-quality IET programs help adult learners without a high school diploma or equivalency 

gain college credits and improve basic skills through dual enrollment that allows them to achieve 

gains faster than if they separately enroll in traditional adult education programs and title IVeligible postsecondary education.

6 20 U.S.C. § 1091(d)(2)(A). 7 20 U.S.C. § 1091(d)(2)(C). 8 20 U.S.C. § 1091(d)(2)(E). 9 See Exhibit A.
Issue Paper 1—ATB Proposal

February 11, 2022

Page 7 of 8

IET is a service approach that provides adult education and literacy activities 

concurrently and contextually with workforce preparation activities and 

workforce training for a specific occupation or occupational cluster for the 

purpose of educational and career advancement (34 CFR §463.35). An IET 

program must include the following three components: adult education and 

literacy activities, workforce preparation activities, and workforce training 

(§463.36). In addition, as part of a career pathway (§463.37), the design of an IET 

program should support the local and state workforce development board plans as 

required under the Workforce Innovation and Opportunity Act (WIOA).10 

The Department of Education’s Institute for Education Science (IES) What Works

Clearinghouse (WWC) confirmed IET as an evidence-based practice with gold standard research 

in three random control trial studies that meet the WWC criteria. This analysis documented 

impacts for tens of thousands of students in nine states, with positive effects on industryrecognized credential, certificate, or license completion, and short-term employment gains.

11

 

As noted in a Department-sponsored publication, 

[c]entral to a successful IET is [adult education] AE programs’ development of 

well-defined partnerships with service providers who can assist in delivering 

required IET program services. Successful IET programs also have explicit 

processes for determining adult learners’ skills, interests, and abilities and for 

matching those learners to technical training that aligns with their skills, interests, 

and abilities. Successful programs also connect adult learners with professional 

development and technical assistance. The OCTAE-supported Integrated 

Education and Training Program Design Toolkit provides guidance on all phases 

of IET program planning, design, implementation, and evaluation.12

3. Same ECP Program Requirements Should Apply Regardless of Approval Process

As currently drafted, the Department’s proposed language is not clear about what ECP Program 

documentation an institution must submit in order to certify ATB student eligibility under the 

non-state alternative processes (§§ 668.32(b)(2), (5)). Proposed § 668.157(a) states, “An 

institution demonstrates to the Secretary that a student is enrolled in an [ECP Program], as 

required under § 668.156(a)(3) of this part, by documenting that . . . .” (emph. added). § 

668.156(a)(3) applies only to ECP Programs that enroll ATB students through a state process. 

10 U.S. Dep’t of Educ., Office of Career, Tech. and Adult Educ., “Integrated Education and Training (IET) Guide.”

11 Inst. of Educ. Sciences, Nat’l Center for Educ. Evaluation, What Works Clearinghouse, Designing and Delivering 

Career Pathways at Community College: A Practice Guide for Educators (Mar. 2021).

12 J.A Alamprese. & I-F. Cheng, Compendium of innovative practices: Adult education bridge programs and 

integrated education and training (IET) programs (Dec. 2020). See also U.S. Dep’t of Educ. Office of Career, 

Tech., and Adult Educ., “Integrated Education and Training Design Toolkit” (Oct. 2021).
Issue Paper 1—ATB Proposal

February 11, 2022

Page 8 of 8

Proposed § 668.157(b), on the other hand, applies to ECP Programs that do not enroll ATB 

students through a state process. The Department, however, does not state that these ECP 

Programs must also document the criteria specified in § 668.157(a).

We hope that the Department intended that the documentation requirements of § 668.157(a) 

apply to all ECP Programs, regardless of whether they enroll ATB students through a state or 

federal process. All ECP Programs should be subject to the same minimum federal requirements

to avoid confusion caused by different documentation requirements and standards. In addition, 

all ATB students (who have no say in whether their financial aid eligibility is certified through a 

state or federal process) should be protected from low-quality ECP Programs by the same 

minimum requirements.

We therefore propose the following amendment to § 668.157(b):

§ 668.157 Eligible Career Pathway Program.

. . .

(b) For eligible career pathway programs that do not enroll students through a 

State process as defined in § 668.156 of this part, the Department will verify the 

eligibility of eligible career pathway programs pursuant to subsection (a) of this 

section for title IV, HEA program purposes. The Secretary provides an institution 

with the opportunity to appeal any adverse eligibility decision.
Exhibit A

Exhibit B