Title: PRO Students Act
Policy area: Education

Summary:
Protections and Regulation for Our Students Act or the PRO Students Act
This bill amends the Higher Education Act of 1965 to increase oversight of postsecondary educational institutions and provide consumer protections for students.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7112 Introduced in House (IH)]

<DOC>






115th CONGRESS
  2d Session
                                H. R. 7112

  To improve the Higher Education Act of 1965, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 30, 2018

Mr. Takano (for himself, Mr. Garamendi, and Mr. Aguilar) introduced the 
 following bill; which was referred to the Committee on Education and 
                             the Workforce

_______________________________________________________________________

                                 A BILL


 
  To improve the Higher Education Act of 1965, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Protections and 
Regulation for Our Students Act'' or ``PRO Students Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. 85-15 revenue source requirement for proprietary institutions.
Sec. 3. Definitions.
Sec. 4. Restriction on marketing with Federal educational assistance 
                            funds.
Sec. 5. Whistleblower protections for persons associated with 
                            institutions of higher education.
Sec. 6. Establishment of complaint resolution and tracking system.
Sec. 7. Improved determination of cohort default rates; publication of 
                            default prevention plan.
Sec. 8. Amendments to terms and conditions of borrower defenses.
Sec. 9. Improved student loan servicing and debt collection practices.
Sec. 10. Improved disclosures, counseling, and financial assistance 
                            information for students.
Sec. 11. Program participation agreements.
Sec. 12. Improved disclosures for clinical training programs.
Sec. 13. Civil penalties.
Sec. 14. Requirements for accrediting agencies or associations.
Sec. 15. Program review and data.
Sec. 16. Consumer protections for students.

SEC. 2. 85-15 REVENUE SOURCE REQUIREMENT FOR PROPRIETARY INSTITUTIONS.

    (a) Change From 90-10 to 85-15.--Section 487(a)(24) of the Higher 
Education Act of 1965 (20 U.S.C. 1094(a)(24)) is amended by striking 
``ten percent'' and inserting ``15 percent''.
    (b) Revisions to Accounting.--Section 487(d)(1) of the Higher 
Education Act of 1965 (20 U.S.C. 1094(d)(1)) is amended--
            (1) in subparagraph (A), by striking ``accounting,'' and 
        all that follows and inserting ``accounting;'';
            (2) in subparagraph (B), by striking clause (iii) and 
        inserting the following new clause:
                            ``(iii) a contractual arrangement with a 
                        Federal agency for the purpose of providing job 
                        training to low-income individuals who are in 
                        need of such training;'';
            (3) in subparagraph (C)--
                    (A) by striking clauses (i) through (iii) and 
                inserting the following new clause:
                            ``(i) grant funds provided by a source that 
                        has no affiliation with the institution and 
                        shares no employees with the institution;''; 
                        and
                    (B) by redesignating clause (iv) as clause (ii); 
                and
            (4) by striking subparagraphs (D) and (E) and inserting the 
        following new subparagraphs:
                    ``(D) include no loans made by an institution of 
                higher education as revenue to the school, except for 
                payments made by students on such loans;
                    ``(E) include a scholarship provided by the 
                institution--
                            ``(i) only if the scholarship is in the 
                        form of monetary aid based upon the academic 
                        achievements or financial need of students, 
                        disbursed to qualified student recipients 
                        during each fiscal year from an established 
                        restricted account; and
                            ``(ii) only to the extent that funds in 
                        that account represent designated funds, or 
                        income earned on such funds, from a source that 
                        has no affiliation with the institution and 
                        shares no employees with the institution; 
                        and''.

SEC. 3. DEFINITIONS.

    (a) In General.--Section 103 of the Higher Education Act of 1965 
(20 U.S.C. 1003) is amended--
            (1) by redesignating paragraphs (4) through (9), (10) 
        through (14), and (15) through (24), as paragraphs (5) through 
        (10), (12) through (16), and (18) through (26), respectively;
            (2) by inserting after paragraph (3) the following new 
        paragraph:
            ``(4) Default manipulation.--The term `default 
        manipulation' means engaging in a device or practice, including 
        branching, consolidation of campuses, consolidation or 
        manipulation of the identification codes used by the Office of 
        Postsecondary Education to designate campuses and institutions, 
        change of ownership or control, serial forbearance, or any 
        similar device or practice (as determined by the Secretary) 
        when, but for the device or practice, one or more campuses of 
        an institution of higher education would be at risk of cohort 
        default rate sanctions under section 435 or student default 
        risk sanctions under section 489A.'';
            (3) by inserting after paragraph (10), as redesignated by 
        paragraph (1) of this section, the following new paragraph:
            ``(11) Federal educational assistance funds.--The term 
        `Federal educational assistance funds' means funds provided 
        directly to an institution or to a student attending such 
        institution under any of the following provisions of law:
                    ``(A) Title IV.
                    ``(B) Section 477 of the Social Security Act.
                    ``(C) Chapter 30, 31, 32, 33, 34, or 35 of title 
                38, United States Code.
                    ``(D) Chapter 101, 105, 106A, 1606, 1607, or 1608 
                of title 10, United States Code.
                    ``(E) Section 1784a, 2005, or 2007 of title 10, 
                United States Code.
                    ``(F) Title I of the Workforce Innovation and 
                Opportunity Act (29 U.S.C. 3101 et seq.).
                    ``(G) The Adult Education and Family Literacy Act 
                (29 U.S.C. 3101 et seq.).''; and
            (4) by inserting after paragraph (16), as redesignated by 
        paragraph (1) of this section, the following new paragraph:
            ``(17) Recruiting and marketing activity.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the term `recruiting and marketing 
                activity' means an activity that consists of any of the 
                following:
                            ``(i) Any advertising or promotion 
                        activity, including a paid announcement in 
                        newspapers, magazines, radio, television, 
                        billboards, electronic media, naming rights, or 
                        any other public medium of communication, 
                        including paying for a display or promotion at 
                        a job fair, military installation, or 
                        postsecondary education recruiting event.
                            ``(ii) Any effort to identify and attract 
                        prospective students, directly or through a 
                        contractor or other third party, including any 
                        contact concerning a prospective student's 
                        potential enrollment or application for grant, 
                        loan, or work assistance under title IV or 
                        participation in preadmission or advising 
                        activities, including--
                                    ``(I) paying employees responsible 
                                for overseeing enrollment and for 
                                contacting potential students in 
                                person, by phone, by email, by internet 
                                communications, or by other means, 
                                regarding enrollment;
                                    ``(II) compensating a person to 
                                provide to an institution of higher 
                                education contact information regarding 
                                prospective students, including 
                                information obtained through websites 
                                established for such purpose; and
                                    ``(III) providing funds to a third 
                                party to create or maintain a website 
                                for the purpose of obtaining contact 
                                information regarding prospective 
                                students.
                            ``(iii) Any other activity as the Secretary 
                        may determine.
                    ``(B) Exception.--An activity that is required as a 
                condition of receipt of funds by an institution under 
                title IV, or under another applicable Federal law, 
                shall not be considered to be a recruiting and 
                marketing activity under subparagraph (A).''.
    (b) Title IV Programs.--Section 481 of the Higher Education Act of 
1965 (20 U.S.C. 1088) is amended by adding at the end the following new 
subsection:
    ``(g) Student Default Risk.--In this title, the term `student 
default risk' means the percentage that is calculated by taking an 
institution's cohort default rate (as defined in section 435(m)) for 
the most recent fiscal year available, and multiplying it by the 
percentage of students enrolled at such institution receiving a loan 
made, insured, or guaranteed under this title during the previous 
academic year.''.

SEC. 4. RESTRICTION ON MARKETING WITH FEDERAL EDUCATIONAL ASSISTANCE 
              FUNDS.

    (a) Repeal of Existing Provision.--The Higher Education Opportunity 
Act is amended by striking section 119 (20 U.S.C. 1011m).
    (b) Insertion in Higher Education Act of 1965 and Amendments.--Part 
B of title I of the Higher Education Act of 1965 (20 U.S.C. 1011 et 
seq.) is amended by adding at the end the following new section:

``SEC. 124. CERTIFICATION REGARDING THE USE OF CERTAIN FEDERAL FUNDS 
              AND RESTRICTIONS ON SOURCES OF FUNDS FOR RECRUITING AND 
              MARKETING ACTIVITIES.

    ``(a) Prohibition.--No Federal funds received under this Act by an 
institution of higher education or other postsecondary educational 
institution may be used to pay any person for influencing or attempting 
to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a 
Member of Congress in connection with any Federal action described in 
subsection (b).
    ``(b) Applicability.--The prohibition in subsection (a) applies 
with respect to the following Federal actions:
            ``(1) The awarding of any Federal contract.
            ``(2) The making of any Federal grant.
            ``(3) The making of any Federal loan.
            ``(4) The entering into of any Federal cooperative 
        agreement.
            ``(5) The extension, continuation, renewal, amendment, or 
        modification of any Federal contract, grant, loan, or 
        cooperative agreement.
    ``(c) Lobbying and Earmarks.--No Federal student aid funding under 
this Act may be used to hire a registered lobbyist or pay any person or 
entity for securing an earmark.
    ``(d) Restrictions on Sources of Funds for Recruiting and Marketing 
Activities.--
            ``(1) In general.--An institution of higher education, or 
        other postsecondary educational institution, may not use 
        revenues derived from Federal educational assistance funds for 
        recruiting or marketing activities.
            ``(2) Rule of construction.--Nothing in this section shall 
        be construed as a limitation on the use by an institution of 
        revenues derived from sources other than Federal educational 
        assistance funds.
            ``(3) Reports.--Each institution of higher education, or 
        other postsecondary educational institution, that derives 65 
        percent or more of revenues from Federal educational assistance 
        funds shall report annually to the Secretary and to Congress 
        and shall include in such report--
                    ``(A) a statement of the institution's expenditures 
                on advertising, marketing, and recruiting; and
                    ``(B) a verification from an independent auditor 
                that the institution is in compliance with the 
                requirements of this subsection.
    ``(e) Certification.--Each institution of higher education or other 
postsecondary educational institution receiving Federal funding under 
this Act, as a condition for receiving such funding, shall annually 
certify to the Secretary of Education that the requirements of 
subsections (a) through (d) have been met.
    ``(f) Actions To Implement and Enforce.--The Secretary shall take 
such actions as are necessary to ensure that the provisions of this 
section are implemented and enforced.''.

SEC. 5. WHISTLEBLOWER PROTECTIONS FOR PERSONS ASSOCIATED WITH 
              INSTITUTIONS OF HIGHER EDUCATION.

    (a) Whistleblower Protection Program.--Title I of the Higher 
Education Act of 1965 is amended by inserting after section 123 (20 
U.S.C. 1011l) the following new section:

``SEC. 124. PROTECTION FROM RETALIATION FOR DISCLOSURE OF CERTAIN 
              INFORMATION BY PERSONS ASSOCIATED WITH INSTITUTIONS OF 
              HIGHER EDUCATION.

    ``(a) Prohibition of Retaliation.--
            ``(1) In general.--An institution of higher education 
        participating in programs under title IV (in this section 
        referred to as an `institution') may not discharge, demote, or 
        otherwise discriminate against any person as retaliation for--
                    ``(A) such person disclosing to an individual or 
                entity described in paragraph (2) information such 
                person reasonably believes evidences a violation of any 
                law, rule, or regulation by the institution; or
                    ``(B) assisting a person disclosing such 
                information or providing information or documents for 
                use in disclosing such information.
            ``(2) Individuals and entities covered.--The individuals 
        and entities described in this paragraph are:
                    ``(A) A Member of Congress or a representative of a 
                committee of Congress.
                    ``(B) An Executive agency (as defined in section 
                105 of title 5, United States Code).
                    ``(C) The Government Accountability Office.
                    ``(D) A law enforcement agency.
                    ``(E) A court or grand jury.
                    ``(F) A management official or other employee of an 
                institution who has the responsibility to investigate, 
                discover, or address misconduct.
    ``(b) Investigation of Complaints.--
            ``(1) Submission of complaint.--A person who believes that 
        they have been subjected to a retaliation prohibited by 
        subsection (a) may submit a complaint to the Inspector General 
        of the Department of Education (in this section referred to as 
        the `Inspector General'). Unless the Inspector General 
        determines that the complaint is frivolous, fails to allege a 
        violation of subsection (a), or has previously been addressed 
        in another Federal or State judicial or administrative 
        proceeding initiated by the complainant, the Inspector General 
        shall investigate the complaint and, upon completion of such 
        investigation, submit a report of the findings of the 
        investigation to the complainant, the institution concerned, 
        and the Secretary.
            ``(2) Inspector general action.--
                    ``(A) Determination or submission of report on 
                findings.--Except as provided under subparagraph (B), 
                the Inspector General shall make a determination that a 
                complaint is frivolous, fails to allege a violation of 
                subsection (a), or has previously been addressed in 
                another Federal or State judicial or administrative 
                proceeding initiated by the complainant or submit a 
                report under paragraph (1) not later than 180 days 
                after receiving the complaint.
                    ``(B) Extension of time.--If the Inspector General 
                is unable to complete an investigation in time to 
                submit a report within the 180-day period specified in 
                subparagraph (A) and the complainant agrees to an 
                extension of time, the Inspector General shall submit a 
                report under paragraph (1) within such additional 
                period of time, up to 180 days, as shall be agreed upon 
                between the Inspector General and the complainant.
            ``(3) Prohibition on disclosure.--The Inspector General may 
        not respond to any inquiry or disclose any information from or 
        about any person alleging retaliation, except to the extent 
        that such response or disclosure is--
                    ``(A) made with the consent of the person alleging 
                the retaliation;
                    ``(B) made in accordance with the provisions of 
                section 552a of title 5, United States Code, or as 
                required by any other applicable Federal law; or
                    ``(C) necessary to conduct an investigation of the 
                alleged retaliation.
            ``(4) Time limitation.--A complaint may not be brought 
        under this subsection more than three years after the date on 
        which the alleged retaliation took place.
    ``(c) Remedy and Enforcement Authority.--
            ``(1) In general.--Not later than 30 days after receiving 
        an Inspector General report pursuant to subsection (b), the 
        Secretary shall determine whether there is sufficient basis to 
        conclude that the institution has violated subsection (a) and 
        shall either issue an order denying relief or shall take one or 
        more of the following actions:
                    ``(A) Order the institution to take action to abate 
                the retaliation.
                    ``(B) Order the institution to reinstate the 
                complainant to the position that the complainant held 
                before the retaliation, together with compensatory 
                damages (including back pay) and any other benefits, 
                terms, or conditions that would apply to the 
                complainant in that position if the retaliation had not 
                occurred.
                    ``(C) Order the institution to pay the complainant 
                an amount equal to the aggregate amount of all costs 
                and expenses (including attorneys' fees and expert 
                witness fees) that were reasonably incurred by the 
                complainant for, or in connection with, bringing the 
                complaint regarding the retaliation, as determined by 
                the Secretary.
            ``(2) Exhaustion of remedies.--If the Secretary issues an 
        order denying relief under paragraph (1) or has not issued an 
        order within 210 days after the submission of a complaint under 
        subsection (b), or in the case of an extension of time under 
        subsection (b)(2)(B), not later than 30 days after the 
        expiration of the extension of time, and there is no showing 
        that such delay is due to the bad faith of the complainant, the 
        complainant shall be deemed to have exhausted all 
        administrative remedies with respect to the complaint, and the 
        complainant may bring a de novo action at law or equity against 
        the institution to seek compensatory damages and other relief 
        available under this section in the appropriate district court 
        of the United States, which shall have jurisdiction over such 
        an action without regard to the amount in controversy. Such an 
        action shall, at the request of either party to the action, be 
        tried by the court with a jury. An action under this paragraph 
        may not be brought more than two years after the date on which 
        remedies are deemed to have been exhausted.
            ``(3) Admissibility of evidence.--The Inspector General 
        determination and order of the Secretary denying relief under 
        paragraph (2) shall be admissible in evidence in any de novo 
        action at law or equity brought pursuant to this subsection.
            ``(4) Enforcement of orders.--Whenever a person fails to 
        comply with an order issued under paragraph (1), the Secretary 
        shall file an action for enforcement of such order in the 
        United States district court for a district in which the 
        retaliation was found to have occurred. In any action brought 
        under this paragraph, the court may grant appropriate relief, 
        including injunctive relief, compensatory and exemplary 
        damages, and attorneys' fees and costs. The person upon whose 
        behalf an order was issued may also file such an action or join 
        in an action filed by the Secretary.
            ``(5) Judicial review.--Any person adversely affected or 
        aggrieved by an order issued under paragraph (1) may obtain 
        review of the order's conformance with this subsection, and any 
        regulations issued to carry out this section, in the United 
        States court of appeals for a circuit in which the retaliation 
        is alleged in the order to have occurred. No petition seeking 
        such review may be filed more than 60 days after issuance of 
        the order by the head of the executive agency. Such review 
        shall conform to chapter 7 of title 5, United States Code. 
        Filing such an appeal shall not act to stay the enforcement of 
        the order of the Secretary, unless a stay is specifically 
        entered by the court.
            ``(6) Burdens of proof.--The legal burdens of proof 
        specified in section 1221(e) of title 5, United States Code, 
        shall be controlling for the purposes of any investigation 
        conducted by the Inspector General, decision by the Secretary, 
        or judicial or administrative proceeding to determine whether 
        discrimination prohibited under this section has occurred.
            ``(7) Rights and remedies not waivable.--The rights and 
        remedies provided for in this section may not be waived by any 
        agreement, policy, form, or condition of employment.
    ``(d) Notification of Persons Associated With Institution.--The 
Secretary shall ensure that each institution informs the employees, 
students, and contractors of the institution in writing of the rights 
and remedies provided under this section.
    ``(e) Construction.--Nothing in this section may be construed to 
authorize the discharge of, demotion of, or discrimination against a 
person for a disclosure other than a disclosure protected by subsection 
(a) or to modify or derogate from a right or remedy otherwise available 
such person.''.
    (b) Prohibition of Retaliation.--Section 487(a) of the Higher 
Education Act of 1965 (20 U.S.C. 1094(a)) is amended by adding at the 
end the following new paragraph:
            ``(30) The institution will comply with the requirements of 
        section 124.''.

SEC. 6. ESTABLISHMENT OF COMPLAINT RESOLUTION AND TRACKING SYSTEM.

    Title I of the Higher Education Act of 1965 (20 U.S.C. 1001 et 
seq.) is amended by adding at the end the following new part:

                  ``PART F--COMPLAINT TRACKING SYSTEM

``SEC. 161. COMPLAINT TRACKING SYSTEM.

    ``(a) Establishment of Complaint Tracking System.--
            ``(1) Establishment of complaint tracking system.--Not 
        later than 1 year after the enactment of the PRO Students Act, 
        the Secretary shall complete the establishment of a complaint 
        tracking system that includes a single, toll-free telephone 
        number and a website to facilitate the centralized collection 
        of, monitoring of, and response to complaints or inquiries 
        regarding the educational practices and services, and 
        recruiting and marketing practices, of all postsecondary 
        educational institutions.
            ``(2) Establishment of complaint tracking office.--The 
        Secretary shall establish within the Department an office whose 
        functions shall include establishing, administering, and 
        disseminating widely information about the complaint tracking 
        system established under paragraph (1). The Secretary shall--
                    ``(A) to the extent necessary, combine and 
                consolidate the other offices and functions of the 
                Department to ensure that the office established under 
                this paragraph is the single point of contact for 
                students and borrowers with complaints; and
                    ``(B) to the extent practicable, ensure that the 
                office established in this paragraph will work with the 
                Student Loan Ombudsman appointed in accordance with 
                section 141(f) to assist borrowers that have complaints 
                regarding the educational practices and services, and 
                recruiting and marketing practices, of postsecondary 
                educational institutions.
    ``(b) Handling of Complaints.--
            ``(1) Timely response to complaints.--The Secretary shall 
        establish, in consultation with the heads of appropriate 
        agencies, reasonable procedures to provide a timely response to 
        complainants, in writing where appropriate, to complaints 
        against, or inquiries concerning, an institution of higher 
        education that receives funds under this Act. Each response 
        shall include a description of--
                    ``(A) the steps that have been taken by the 
                Secretary in response to the complaint or inquiry;
                    ``(B) any responses received by the Secretary from 
                the institution of higher education; and
                    ``(C) any additional actions that the Secretary has 
                taken, or plans to take, in response to the complaint 
                or inquiry.
            ``(2) Timely response to secretary by institution of higher 
        education.--The Secretary shall notify each institution of 
        higher education that receives funds under this Act and that is 
        the subject of a complaint or inquiry under this section 
        regarding the complaint or inquiry. Not later than 60 days 
        after receiving such notice, such institution shall provide a 
        response to the Secretary concerning the complaint or inquiry, 
        including--
                    ``(A) the steps that have been taken by the 
                institution to respond to the complaint or inquiry;
                    ``(B) all responses received by the institution 
                from the complainant; and
                    ``(C) any additional actions that the institution 
                has taken, or plans to take, in response to the 
                complaint or inquiry.
            ``(3) Further investigation.--The Secretary may, in the 
        event that the complaint is not adequately resolved or 
        addressed by the responses of the institution of higher 
        education receiving funds under this Act under paragraph (2), 
        ask additional questions of such institution or seek additional 
        information from or action by the institution.
            ``(4) Provision of information.--
                    ``(A) In general.--An institution of higher 
                education that receives funds under this Act shall, in 
                a timely manner, comply with a request by the Secretary 
                for information in the control or possession of such 
                institution concerning a complaint or inquiry received 
                by the Secretary under subsection (a), including 
                supporting written documentation, subject to 
                subparagraph (B).
                    ``(B) Exceptions.--An institution of higher 
                education that receives funds under this Act shall not 
                be required to make available under this subsection--
                            ``(i) any nonpublic or confidential 
                        information, including any confidential 
                        commercial information;
                            ``(ii) any information collected by the 
                        institution for the purpose of preventing fraud 
                        or detecting or making any report regarding 
                        other unlawful or potentially unlawful conduct; 
                        or
                            ``(iii) any information required to be kept 
                        confidential by any other provision of law.
            ``(5) Compliance.--An institution of higher education that 
        receives funds under this Act shall comply with the 
        requirements to provide responses and information, in 
        accordance with this subsection, as a condition of receiving 
        such funds.
    ``(c) Transparency.--
            ``(1) Sharing information with federal and state 
        agencies.--As appropriate and in accordance with section 444 of 
        the General Education Provisions Act (20 U.S.C. 1232g) 
        (commonly referred to as the ``Family Educational Rights and 
        Privacy Act of 1974'') and other laws, the Secretary shall 
        coordinate with the heads of relevant Federal and State 
        agencies to--
                    ``(A) collect complaints related to the complaint 
                tracking system described in subsection (b) from such 
                agencies; and
                    ``(B) when appropriate, route such complaints to 
                the Department of Education, the Department of Justice, 
                the Department of Defense, the Department of Veterans 
                Affairs, the Federal Trade Commission, the Consumer 
                Financial Protection Bureau, or any equivalent State 
                agency.
            ``(2) Interaction with existing complaint systems.--To the 
        extent practicable, all procedures established under this 
        section, and all coordination carried out under paragraph (1), 
        shall be done in accordance with the complaint tracking systems 
        established under Executive Order 13607 (77 Fed. Reg. 25861; 
        relating to establishing principles of excellence for 
        educational institutions serving servicemembers, veterans, 
        spouses, and other family members).
            ``(3) Public information.--
                    ``(A) In general.--The Secretary shall regularly 
                publish on the website of the Department information on 
                the complaints and inquiries received for each 
                postsecondary educational institution under this 
                section, including--
                            ``(i) the number of complaints and 
                        inquiries received;
                            ``(ii) the types of complaints and 
                        inquiries received; and
                            ``(iii) where applicable, information about 
                        the resolution of the complaints and inquiries.
                    ``(B) Data privacy.--In carrying out subparagraph 
                (A), the Secretary shall--
                            ``(i) comply with applicable data privacy 
                        laws and regulations; and
                            ``(ii) ensure that personally identifiable 
                        information is not shared.
            ``(4) Reports.--Each year, the Secretary shall prepare and 
        submit to the authorizing committees a report describing--
                    ``(A) the types and nature of complaints the 
                Secretary has received under this section;
                    ``(B) the extent to which complainants are 
                receiving relief pursuant to this section;
                    ``(C) whether particular types of complaints are 
                more common in a given sector of postsecondary 
                educational institutions;
                    ``(D) any legislative recommendations that the 
                Secretary determines are necessary to better assist 
                students and families; and
                    ``(E) the schools with the highest volume of 
                complaints, as determined by the Secretary.
    ``(d) Complainant Defined.--In this section, the term `complainant' 
means a person with a complaint against, or inquiry concerning, an 
institution of higher education that receives funds under this Act who 
is--
            ``(1) a student of a postsecondary educational institution;
            ``(2) a family member of a student of a postsecondary 
        educational institution;
            ``(3) a third party acting on behalf of a student of a 
        postsecondary educational institution; or
            ``(4) a staff member or employee of a postsecondary 
        educational institution.''.

SEC. 7. IMPROVED DETERMINATION OF COHORT DEFAULT RATES; PUBLICATION OF 
              DEFAULT PREVENTION PLAN.

    Section 435 of the Higher Education Act of 1965 (20 U.S.C. 1085) is 
amended--
            (1) in subsection (a)--
                    (A) in paragraph (2), by adding at the end the 
                following new subparagraph:
            ``(D) In any case where the Secretary has determined that 
        the institution has engaged in default manipulation, the 
        Secretary--
                    ``(i) shall recalculate the cohort default rate for 
                the institution under this section using corrected data 
                and information, for all fiscal years for which the 
                default manipulation has occurred; and
                    ``(ii) using the recalculated cohort default rate, 
                shall redetermine under subsection (a)(2) whether the 
                institution is ineligible to participate in a program 
                under this title.''; and
                    (B) in paragraph (7)(A), by adding at the end the 
                following new clause:
                            ``(iii) Summary of default prevention 
                        plan.--Upon receiving technical assistance from 
                        the Secretary under clause (ii), each 
                        institution subject to this subparagraph 
                        shall--
                                    ``(I) prepare a summary of the plan 
                                described under clause (i) that is 
                                directed to a student audience;
                                    ``(II) make the summary publicly 
                                available; and
                                    ``(III) provide the summary to 
                                students at the institution.''; and
            (2) in subsection (m)(3), by striking ``through the use 
        of'' and all that follows through the period at the end and 
        inserting ``through default manipulation''.

SEC. 8. AMENDMENTS TO TERMS AND CONDITIONS OF BORROWER DEFENSES.

    Section 455(h) of the Higher Education Act of 1965 (20 U.S.C. 
1087e(h)) is amended to read as follows:
    ``(h) Borrower Defenses.--
            ``(1) In general.--Notwithstanding any other provision of 
        State or Federal law, a defense to repayment of a loan under 
        this title includes--
                    ``(A) a substantial misrepresentation under section 
                487(c)(3);
                    ``(B) an act or omission that would give rise to a 
                cause of action against the school under applicable 
                State law; or
                    ``(C) such further acts or omissions that the 
                Secretary determines appropriate.
            ``(2) Procedures.--
                    ``(A) In general.--The Secretary shall, with 
                respect to a borrower defense under this subsection--
                            ``(i) determine the entitlement of a 
                        borrower to relief based on all evidence 
                        available to the Department; and
                            ``(ii) provide an expeditious and fair 
                        process to consider applications provided by 
                        individuals, groups, and representatives on 
                        behalf of groups.
                    ``(B) Independent determination.--A determination 
                under subparagraph (A)(i) shall be independent of any 
                action that the Department may take to recoup from the 
                school related to the borrower defense.
                    ``(C) Cancellation of debt.--If the Secretary 
                determines under subparagraph (A)(i) that a borrower is 
                entitled to relief, the Secretary shall cancel all 
                outstanding debt, and return any payments made on the 
                loans of such borrower.
            ``(3) Regulations.--The Secretary shall specify in 
        regulations which acts or omissions of an institution of higher 
        education a borrower may assert as a defense to repayment of a 
        loan made under this part, except that in no event may a 
        borrower recover from the Secretary, in any action arising from 
        or relating to a loan made under this part, an amount in excess 
        of the amount such borrower has repaid on such loan.''.

SEC. 9. IMPROVED STUDENT LOAN SERVICING AND DEBT COLLECTION PRACTICES.

    Section 456 of the Higher Education Act of 1965 (20 U.S.C. 1087f) 
is amended by adding at the end the following new subsection:
    ``(c) No Predispute Arbitration Clauses.--A contract entered into 
under this section for the servicing of loans made or purchased under 
this part shall include a provision that any rights and remedies 
available to borrowers against the servicer may not be waived by any 
agreement, policy, or form, including by a predispute arbitration 
agreement.''.

SEC. 10. IMPROVED DISCLOSURES, COUNSELING, AND FINANCIAL ASSISTANCE 
              INFORMATION FOR STUDENTS.

    Section 485(l) of the Higher Education Act of 1965 (20 U.S.C. 
1092(l)) is amended--
            (1) by striking paragraph (1) and inserting the following 
        new paragraph:
            ``(1) Disclosure required prior to signing master 
        promissory note.--Each eligible institution shall, prior to 
        obtaining or arranging execution of a master promissory note 
        for a loan under part D (other than a Federal Direct 
        Consolidation Loan) by a first-time borrower at such 
        institution, ensure that the borrower receives comprehensive 
        information on the terms and conditions of the loan and of the 
        responsibilities the borrower has with respect to such loan in 
        accordance with paragraph (2). Such information--
                    ``(A) shall be provided through the use of 
                interactive programs that include mechanisms to check 
                the borrower's comprehension of the terms and 
                conditions of the borrower's loans under part D, using 
                simple and understandable language and clear 
                formatting; and
                    ``(B) shall be provided--
                            ``(i) during an entrance counseling session 
                        conducted in person; or
                            ``(ii) online.''; and
            (2) in paragraph (2), by adding at the end the following 
        new subparagraph:
                    ``(L) Information relating to the institution's 
                cohort default rate, including--
                            ``(i) the cohort default rate, as defined 
                        in section 435(m), of the institution;
                            ``(ii) an easy to understand explanation of 
                        the cohort default rate;
                            ``(iii) the percentage of students at the 
                        institution of higher education who borrow 
                        Federal student loans under this title;
                            ``(iv) the national average cohort default 
                        rate (as determined by the Secretary in 
                        accordance with section 435(m));
                            ``(v) in the case of an institution with a 
                        cohort default rate that is greater than the 
                        national average cohort default rate (as 
                        described in clause (iv)), a disclosure to the 
                        student that the institution's cohort default 
                        rate is above the national average; and
                            ``(vi) in the case of an institution with a 
                        cohort default rate that is greater than 30 
                        percent, a disclosure to the students that if 
                        the cohort default rate remains greater than 30 
                        percent for the 3 consecutive years--
                                    ``(I) the institution will lose 
                                institutional eligibility for the 
                                purposes of programs authorized under 
                                this title; and
                                    ``(II) the student will no longer 
                                be able to receive Federal financial 
                                aid at that institution.''.

SEC. 11. PROGRAM PARTICIPATION AGREEMENTS.

    (a) Sense of Congress Regarding Incentive Compensation.--It is the 
sense of Congress that--
            (1) incentive compensation is an inappropriate mechanism in 
        the delivery of higher education for institutions of higher 
        education wishing to participate in programs under title IV of 
        the Higher Education Act of 1965 (20 U.S.C. 1001 et seq.); and
            (2) the ban on incentive compensation under section 
        487(a)(20) of the Higher Education Act of 1965 (20 U.S.C. 
        1094(a)(20)), as amended by subsection (b), is intended to 
        preclude its use by institutions wishing to participate in such 
        programs, at any point in the recruitment, enrollment, 
        education, or employment placement of students.
    (b) Amendments.--Section 487 of the Higher Education Act of 1965 
(20 U.S.C. 1094) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (19), by inserting ``housing 
                facilities,'' after ``libraries,'';
                    (B) by striking paragraph (20) and inserting the 
                following:
            ``(20)(A) The institution or any third party acting on the 
        institution's behalf, including an institution affiliate or 
        service provider to the institution, will not provide any 
        commission, bonus, or other incentive payment to any person or 
        entity at any phase of the academic process based directly or 
        indirectly on success in--
            ``(i) securing enrollments or securing or awarding 
        financial aid;
            ``(ii) performance in educational coursework;
            ``(iii) graduation;
            ``(iv) job placement; or
            ``(v) any other academic facet of a student's enrollment in 
        an institution of higher education.
    ``(B) The requirements of subparagraph (A) shall not apply to the 
recruitment of foreign students residing in foreign countries who are 
not eligible to receive Federal student assistance.''; and
                    (C) by adding at the end the following new 
                paragraphs:
            ``(30)(A) The institution--
                    ``(i) shall not include a predispute arbitration 
                agreement in any contract with a student or prospective 
                student for enrollment at the institution; and
                    ``(ii) shall agree that, in any case where a 
                contract for enrollment at the institution entered into 
                by a student before the date of enactment of the 
                Protections and Regulation for Our Students Act 
                included a predispute arbitration agreement, such 
                agreement shall be invalid and unenforceable by the 
                institution.
            ``(B) In this paragraph, the term `predispute arbitration 
        agreement' means any agreement to arbitrate a dispute that had 
        not yet arisen at the time of the making of the agreement.
            ``(31)(A) If the institution has a student default risk for 
        a fiscal year, as calculated by the Secretary, of 0.1 or 
        greater, the institution will, for such year--
                    ``(i) provide an individual accepted for enrollment 
                at the institution with a waiting period, beginning on 
                the date that the individual receives notification of 
                the acceptance and lasting for not less than 2 weeks, 
                before the individual is required to enroll in the 
                institution, pay tuition charges, or sign a master 
                promissory note for a loan under this title, in order 
                to give the individual time to consider, and compare 
                among postsecondary options, program costs at the 
                institution and employment prospects upon completion of 
                a program of study;
                    ``(ii) ensure that the receipt of financial aid, 
                incentives, or other benefits is not made contingent on 
                an individual confirming enrollment before the end of 
                the individual's waiting period;
                    ``(iii) inform the individual, in writing and in a 
                manner determined by the Secretary at the time of the 
                acceptance notification, of--
                            ``(I) the individual's right to the 2-week 
                        waiting period under clause (i) beginning on 
                        the date that the individual receives 
                        notification of the acceptance; and
                            ``(II) the reason why the institution is 
                        required to provide such waiting period;
                    ``(iv) notify an individual accepted for enrollment 
                at the institution of all financial aid determinations 
                by not less than 1 week before the enrollment 
                confirmation deadline, if all requested application 
                forms are received from the individual on time; and
                    ``(v) disclose to an individual accepted for 
                enrollment, in a manner determined by the Secretary, 
                that the individual may file a complaint through the 
                complaint tracking system established under section 161 
                if the individual believes that the institution has 
                violated any provision of this paragraph.
            ``(B) If an institution described in subparagraph (A) fails 
        to meet the requirements of this paragraph, the institution 
        shall be subject to a civil penalty in accordance with section 
        489A.
            ``(C) Notwithstanding subparagraph (A), the Secretary may, 
        after providing notice and an opportunity to comment, elect to 
        replace the use of the student default risk percentage 
        threshold established under subparagraph (A) with a loan 
        repayment rate threshold calculated in accordance with section 
        483D(b).''; and
            (2) in subsection (c)(1)(A)(i), by striking ``available'' 
        and inserting ``made publicly available and provided''.

SEC. 12. IMPROVED DISCLOSURES FOR CLINICAL TRAINING PROGRAMS.

    Section 485 of the Higher Education Act of 1965 (20 U.S.C. 1092) is 
amended by adding at the end the following new subsection:
    ``(n) Reports Relating to Clinical Training Programs.--
            ``(1) Report on clinical training program agreements.--
                    ``(A) In general.--Beginning in the year in which 
                the Protections and Regulation for Our Students Act is 
                enacted, an eligible institution that participates in 
                any program under this title shall prepare and submit a 
                report to the Secretary containing the information 
                described in subparagraph (C), for every year in which 
                the eligible institution has an agreement with a 
                hospital or health facility, through which--
                            ``(i) the eligible institution agrees to 
                        provide funding or other benefits to the 
                        hospital or health facility; and
                            ``(ii) that hospital or health facility 
                        provides opportunities for students at the 
                        institution to participate in a clinical 
                        training program.
                    ``(B) Timing.--Following the year in which the 
                Protections and Regulation for Our Students Act is 
                enacted, the report described in this paragraph shall 
                be submitted not more than 30 days after the end of any 
                year for which a report is required to comply with 
                subparagraph (A).
                    ``(C) Contents of report.--The report described in 
                this paragraph shall include the following:
                            ``(i) The amount of any payments from the 
                        institution of higher education to a hospital 
                        or health facility during the period covered by 
                        the report, and the precise terms of any 
                        agreement under which such amounts are 
                        determined.
                            ``(ii) Any conditions associated with the 
                        transfer of money or the provision of clinical 
                        training program opportunities that are part of 
                        the agreement described in subparagraph (A).
                            ``(iii) Any memorandum of understanding 
                        between the institution of higher education, or 
                        an alumni association or foundation affiliated 
                        with or related to such institution, and a 
                        hospital or health facility, that directly or 
                        indirectly relates to any aspect of any 
                        agreement referred to in subparagraph (A) or 
                        controls or directs any obligations or 
                        distribution of benefits between or among any 
                        such entities.
                            ``(iv) For each hospital or health facility 
                        that has an agreement described in subparagraph 
                        (A) with the institution, the number of 
                        clinical training positions at the hospital or 
                        health facility that are reserved for students 
                        at that institution.
            ``(2) Report on charitable donations.--
                    ``(A) In general.--Beginning in the year in which 
                the Protections and Regulation for Our Students Act is 
                enacted, and annually thereafter, an eligible 
                institution shall prepare and submit to the Secretary a 
                report containing the information described in 
                subparagraph (C) if--
                            ``(i) the eligible institution made a 
                        charitable donation to a hospital or health 
                        facility in any of the previous 3 years; and
                            ``(ii) the number of students from the 
                        eligible institution who participate in any 
                        clinical training program at the hospital or 
                        health facility where such a donation was made 
                        increases by more than 5 students or 10 
                        percent, whichever is less, as compared to the 
                        number of such students who participated in a 
                        clinical training program at that hospital or 
                        health facility during the first year in the 
                        previous 3-year period.
                    ``(B) Timing.--Following the year in which the 
                Protections and Regulation for Our Students Act is 
                enacted, the report described in subparagraph (A) shall 
                be submitted not more than 30 days after the end of any 
                year for which a report is required to comply with 
                subparagraph (A).
                    ``(C) Contents of report.--The report described in 
                this paragraph shall include the following:
                            ``(i) The amount of each charitable 
                        donation that was made in the previous 3-year 
                        period by the eligible institution to a 
                        hospital or health facility.
                            ``(ii) The number of students from the 
                        eligible institution who participate in any 
                        clinical training program at the hospital or 
                        health facility where each such donation was 
                        made--
                                    ``(I) during the year in which the 
                                report is submitted; and
                                    ``(II) during the first year in the 
                                previous 3-year period covered by the 
                                report.
            ``(3) Aggregation by institution.--The information required 
        to be reported in this subsection shall include, and shall be 
        aggregated with respect to, each institution of higher 
        education and each alumni association or foundation affiliated 
        with or related to such institution. For any year in which an 
        institution is required to submit a report described under 
        paragraph (1) and a report described under paragraph (2), the 
        institution may submit a single report for that year containing 
        all of the information required under paragraphs (1) and (2).
            ``(4) Report to congress.--The Secretary, in conjunction 
        with the Secretary of Health and Human Services, shall submit 
        to Congress, and make available to the public, an annual report 
        that lists the reports submitted to the Secretary by each 
        institution of higher education in accordance with this 
        subsection.
            ``(5) Public disclosure.--Each eligible institution 
        described in paragraph (1) or (2) of this subsection shall make 
        readily available the reports described in such paragraph (as 
        applicable), through appropriate publications, mailings, and 
        electronic media to the general public.
            ``(6) Definitions.--In this subsection:
                    ``(A) Clinical training program.--The term 
                `clinical training program' means any program at, or 
                associated or affiliated with, a hospital or health 
                facility (or any of a hospital's affiliates or health 
                facility's affiliates), the completion of which 
                fulfills a requirement that is necessary to receive a 
                license, certificate, specialized accreditation, or 
                other academically related pre-condition necessary 
                under Federal or State law for a health profession.
                    ``(B) Health facility.--The term `health facility' 
                has the meaning given that term in section 804(d).
                    ``(C) Hospital.--The term `hospital' has the 
                meaning given that term in section 1861 of the Social 
                Security Act (42 U.S.C. 1395x).''.

SEC. 13. CIVIL PENALTIES.

    Part G of title IV of the Higher Education Act of 1965 (20 U.S.C. 
1088 et seq.) is amended by inserting after section 489 the following 
new section:

``SEC. 489A. CIVIL PENALTIES AND OTHER REMEDIES.

    ``(a) Sanctions for Substantial Misrepresentations or Serious 
Violations.--
            ``(1) Civil penalties.--The Secretary may impose a civil 
        penalty upon an eligible institution upon making a 
        determination, after reasonable notice and opportunity for a 
        hearing, that an eligible institution has engaged in a 
        substantial misrepresentation or other serious violation.
            ``(2) Amount of civil penalties.--A civil penalty imposed 
        for a violation under subparagraph (A) shall be not less than 
        $100,000 or--
                    ``(A) in the case of a first violation, an amount 
                equal to the product of $1,000,000 multiplied by the 
                institution's student default risk, whichever is 
                larger;
                    ``(B) in the case of a second violation, an amount 
                equal to the product of $2,000,000 multiplied by the 
                institution's student default risk, whichever is 
                larger; and
                    ``(C) in the case of a third or subsequent 
                violation, an amount equal to the product of $3,000,000 
                multiplied by the institution's student default risk, 
                whichever is larger.
            ``(3) Treatment of multiple institutions.--For the purpose 
        of determining the number of violations for subparagraph (B), 
        any violation by a particular institution will accrue against 
        all identification codes used by the Office of Postsecondary 
        Education to designate campuses and institutions affiliated 
        with the institution, and within the period of participation 
        for the institution, as defined in section 668.13(b) of title 
        34, Code of Federal Regulations, or any successor regulation.
    ``(b) Sanctions for Other Violations of This Title.--Upon 
determination, after reasonable notice and opportunity for a hearing, 
that an eligible institution has engaged in a violation of any other 
provision of this title, including the failure to carry out any 
provision of this title, that is not a significant misrepresentation or 
other serious violation, the Secretary may impose a civil penalty upon 
such institution of not more than $100,000 (subject to such adjustments 
for inflation as the Secretary may prescribe by regulation) for each 
such violation.
    ``(c) Civil Penalties and Sanctions for Officers of Institutions.--
Upon determination, after reasonable notice and an opportunity for a 
hearing on the record, that an officer of an institution of higher 
education that participates in a program under this title has knowingly 
and willfully, or with gross negligence, violated a provision of this 
title, the Secretary may sanction the officer. Such sanctions may 
include the following:
            ``(1) Prohibiting the institution of higher education that 
        has employed the officer of an institution of higher education 
        and that participates in a program under this title, or any 
        other institution of higher education that participates in a 
        program under this title, from employing the officer, except 
        that any such prohibition under this subsection shall not be 
        for a period of more than 5 years from the date of the 
        determination of the violation.
            ``(2) Assessing a civil penalty against an officer of an 
        institution of higher education who has knowingly and 
        willfully, or with gross negligence, violated a provision of 
        this title, except that any such civil penalty under this 
        subsection shall not be greater than the amount of the 
        officer's compensation for each year for which the violations 
        are determined to have occurred. For purposes of this 
        subparagraph, an officer's compensation shall include proceeds 
        of any sales of stock and any incentive-based compensation 
        (including stock options awarded as compensation) based on 
        information required to be reported to the Secretary or any 
        other Federal agency during the period in which the violations 
        are determined to have occurred.
    ``(d) Limitation, Suspension, or Termination of Eligibility 
Status.--
            ``(1) In general.--Upon determination, after reasonable 
        notice and opportunity for a hearing, that an eligible 
        institution has engaged in a violation of any provision of this 
        title (including the failure to carry out any provision of this 
        title or any regulation prescribed under such provision) or a 
        violation of any applicable special arrangement, agreement, or 
        limitation, the Secretary may limit, suspend, or terminate the 
        participation in any program under this title of an eligible 
        institution, subject to the requirements of paragraph (2).
            ``(2) Suspension procedures.--No period of suspension under 
        this section shall exceed 60 days unless the institution and 
        the Secretary agree to an extension or unless limitation or 
        termination proceedings are initiated by the Secretary within 
        that period of time.
    ``(e) Emergency Action.--
            ``(1) In general.--The Secretary may take an emergency 
        action against an institution, under which the Secretary shall, 
        effective on the date on which a notice and statement of the 
        basis of the action is mailed to the institution (by registered 
        mail, return receipt requested), withhold funds from the 
        institution or its students and withdraw the institution's 
        authority to obligate funds under any program under this title, 
        if the Secretary--
                    ``(A) receives information, determined by the 
                Secretary to be reliable, that the institution is 
                violating any provision of this title, any regulation 
                prescribed under this title, or any applicable special 
                arrangement, agreement, or limitation;
                    ``(B) determines that immediate action is necessary 
                to prevent misuse of Federal funds; and
                    ``(C) determines that the likelihood of loss 
                outweighs the importance of the procedures prescribed 
                in subsection (e) for limitation, suspension, or 
                termination.
            ``(2) Time limitation.--An emergency action described in 
        paragraph (1) shall not exceed 30 days unless limitation, 
        suspension, or termination proceedings are initiated by the 
        Secretary against the institution within that period of time.
            ``(3) Opportunity to show cause.--The Secretary shall 
        provide an institution that is the subject of an emergency 
        action under this subsection an opportunity to show cause, if 
        the institution so requests, that the emergency action is 
        unwarranted and should be lifted.
    ``(f) Lifting of Sanctions.--Notwithstanding any other provision of 
this title, an institution of higher education that has been sanctioned 
by the Secretary under this section or any other provision of this 
title may not have such sanctions lifted until the Secretary has 
conducted a subsequent program review under section 498A and has found 
the institution to be in compliance with this title.
    ``(g) Single Course of Conduct; Compromise Authority and Collection 
of Penalty.--
            ``(1) Same course of conduct.--For purposes of this 
        section, acts and omissions relating to a single course of 
        conduct shall be treated as a single violation.
            ``(2) Compromise authority.--Any civil penalty under this 
        section may be compromised (but not eliminated) by the 
        Secretary. In determining the amount of such penalty, or the 
        amount agreed upon in compromise, the Secretary shall 
        consider--
                    ``(A) the appropriateness of the penalty to the 
                size of the institution of higher education subject to 
                the determination; and
                    ``(B) the gravity of the violation, failure, or 
                misrepresentation.
    ``(h) Collection of Penalty.--The amount of any penalty under this 
section may be deducted from any sums owing by the United States to the 
institution charged.
    ``(i) Disposition of Amounts Recovered.--
            ``(1) In general.--Amounts collected under this section 
        shall be transferred to the Secretary, who shall determine the 
        distribution of collected amounts, in accordance with 
        paragraphs (2) and (3).
            ``(2) Use for program integrity efforts and program 
        reviews.--
                    ``(A) In general.--For each fiscal year, an amount 
                equal to not more than 50 percent of the amounts 
                recovered or collected under this section--
                            ``(i) shall be available to the Secretary 
                        to carry out program reviews under section 498A 
                        and other efforts by the Secretary related to 
                        program integrity under part H; and
                            ``(ii) may be credited, if applicable, for 
                        that purpose by the Secretary to any 
                        appropriations and funds that are available to 
                        the Secretary for obligation at the time of 
                        collection.
                    ``(B) Supplement not supplant.--Amounts made 
                available under subparagraph (A) shall be used to 
                supplement and not supplant any other amounts available 
                to the Secretary for the purpose described in such 
                subparagraph.
                    ``(C) Availability for funds.--Any amounts 
                collected under this section that are made available 
                under paragraph (2) shall remain available until 
                expended.
            ``(3) Use for student relief fund.--For each fiscal year, 
        an amount equal to not less than 50 percent of the amounts 
        recovered or collected under this section shall be deposited 
        into the Student Relief Fund established under subsection (k).
            ``(4) Report.--The Secretary shall regularly publish, on 
        the website of the Department, a detailed description that 
        includes--
                    ``(A) the amount of funds that were distributed for 
                the purposes described in paragraph (2) and the amount 
                used for the Student Relief Fund under paragraph (3); 
                and
                    ``(B) how funds were distributed among the purposes 
                described in paragraph (2)(A)(i).
    ``(j) Student Relief Fund.--
            ``(1) Establishment.--The Secretary shall establish a 
        Student Relief Fund (referred to in this subsection as the 
        `Fund') that shall be used, subject to the availability of 
        funds, to provide financial relief to any student enrolled in 
        an institution of higher education that--
                    ``(A) has failed to comply with an eligibility 
                requirement under section 101 or 102 or an obligation 
                incurred under the terms of the program participation 
                agreement under section 487; or
                    ``(B) has been sanctioned under subsection (b) or 
                (c).
            ``(2) Determination of relief.--The Secretary, in 
        consultation with Director of the Bureau of Consumer Financial 
        Protection--
                    ``(A) shall determine the manner of relief to be 
                provided under paragraph (1), which may include tuition 
                reimbursement, full or partial loan forgiveness, or 
                loan reinstatement; and
                    ``(B) may issue regulations regarding how the 
                amounts in the Fund will be distributed among students 
                eligible for the funds.
            ``(3) Treatment and availability of funds.--
                    ``(A) Funds that are not government funds.--Funds 
                obtained by or transferred to the Fund shall not be 
                construed to be Government funds or appropriated 
                monies.
                    ``(B) Amounts not subject to apportionment.--
                Notwithstanding any other provision of law, amounts in 
                the Fund shall not be subject to apportionment for 
                purposes of chapter 15 of title 31, United States Code, 
                or under any other authority.
                    ``(C) No fiscal year limitation.--Sums deposited in 
                the Fund shall remain in the Fund and be available for 
                expenditure under this chapter without fiscal year 
                limitation.
            ``(4) Investments.--
                    ``(A) Amounts in fund may be invested.--The 
                Secretary of Education may request the Secretary of the 
                Treasury to invest the portion of the Fund that is not, 
                in the discretion of the Secretary of Education, 
                required to meet the current needs of the Fund.
                    ``(B) Eligible investments.--Investments shall be 
                made by the Secretary of the Treasury in obligations of 
                the United States or obligations that are guaranteed as 
                to principal and interest by the United States, with 
                maturities suitable to the needs of the Fund as 
                determined by the Secretary on the record.
                    ``(C) Interest and proceeds credited.--The interest 
                on, and the proceeds from the sale or redemption of, 
                any obligations held in the Fund shall be credited to 
                the Fund.
            ``(5) Regulations.--The Secretary shall prescribe 
        regulations to implement the requirements of this section 
        within 1 year after the date of enactment of the PRO Students 
        Act.
            ``(6) Authorization of appropriations.--In addition to 
        funds derived from financial penalties assessed pursuant to 
        subsection (j), there are authorized to be appropriated such 
        sums as may be necessary to carry out this subsection.
    ``(k) State Enforcement.--
            ``(1) In general.--Any violation of subsection (b), 
        including the regulations promulgated under such subsection, 
        shall be a cause of action enforceable by the State, through 
        the attorney general (or the equivalent thereof) of the State, 
        in any district court of the United States in that State or in 
        a State court that is located in that State and that has 
        jurisdiction over the defendant. The State may seek any relief 
        provided under paragraph (4)(B) for such violation, or any 
        remedies otherwise provided under law.
            ``(2) Notice required.--
                    ``(A) In general.--Before initiating any action in 
                a court or other administrative or regulatory 
                proceeding against any institution of higher education 
                as authorized by paragraph (1) to enforce any provision 
                of this subsection, including any regulation 
                promulgated by the Secretary under this subsection, a 
                State attorney general shall timely provide a copy of 
                the complete complaint to be filed and written notice 
                describing such action or proceeding to the Secretary, 
                except as provided in subparagraph (B).
                    ``(B) Emergency action.--If prior notice of the 
                initiation of an action or administrative or regulatory 
                proceeding required under subparagraph (A) is not 
                practicable, the State attorney general shall provide a 
                copy of the complete complaint and the notice to the 
                Secretary immediately upon instituting the action or 
                proceeding.
                    ``(C) Contents of notice.--The notification 
                required under this subparagraph shall include--
                            ``(i) the identity of the parties;
                            ``(ii) the alleged facts underlying the 
                        proceeding; and
                            ``(iii) whether there may be a need to 
                        coordinate the prosecution of the proceeding so 
                        as not to interfere with any action, including 
                        any rulemaking, undertaken by the Secretary or 
                        another Federal agency.
            ``(3) Regulations.--The Secretary shall prescribe 
        regulations to implement the requirements of this subsection 
        and periodically provide guidance to further coordinate actions 
        with the State attorneys general.
            ``(4) Preservation of state authority.--
                    ``(A) State claims.--Nothing in this subsection 
                shall be construed as altering, limiting, or affecting 
                the authority of a State attorney general or any other 
                regulatory or enforcement agency or authority to bring 
                an action or other regulatory proceeding arising solely 
                under the law in effect in that State.
                    ``(B) Relief.--
                            ``(i) In general.--Relief under this 
                        subsection may include, without limitation--
                                    ``(I) rescission or reformation of 
                                contracts;
                                    ``(II) refund of moneys or return 
                                of real property;
                                    ``(III) restitution;
                                    ``(IV) disgorgement or compensation 
                                for unjust enrichment;
                                    ``(V) payment of damages or other 
                                monetary relief pursuant to the 
                                requirements of paragraph (2);
                                    ``(VI) public notification 
                                regarding the violation, including the 
                                costs of notification; and
                                    ``(VII) limits on the activities or 
                                functions of the person.
                            ``(ii) Exclusion.--Relief under this 
                        subsection shall not include the ability to 
                        suspend or terminate the eligibility status of 
                        an institution of higher education for programs 
                        under this title.
    ``(l) Definitions.--In this section:
            ``(1) Officer of an institution of higher education.--The 
        term `officer of an institution of higher education' includes 
        the president, chief executive officer, and chief financial 
        officer of an institution of higher education or their 
        equivalents.
            ``(2) Substantial misrepresentation or other serious 
        violation.--The term `substantial misrepresentation or other 
        serious violation' means any of the following:
                    ``(A) A substantial misrepresentation regarding--
                            ``(i) the nature of the educational program 
                        of an institution of higher education;
                            ``(ii) the financial charges of the 
                        institution;
                            ``(iii) the space availability in a program 
                        of the institution for which a student is 
                        considering enrollment;
                            ``(iv) the admission requirements of the 
                        institution;
                            ``(v) the transferability of credits from 
                        the institution;
                            ``(vi) whether a program of the institution 
                        meets the necessary standards to qualify 
                        students to sit for licensing examinations, or 
                        obtain certification required as a precondition 
                        for employment, in the State in which the 
                        students reside;
                            ``(vii) the passage rates of students at 
                        the institution in obtaining certification 
                        requirements;
                            ``(viii) the passage rates of students who 
                        sit for licensing examinations; or
                            ``(ix) the employability of the graduates 
                        of the institution.
                    ``(B) Failure of an institution subject to the 
                requirements of section 487(a)(32) to comply with such 
                section.
                    ``(C) A knowing and willful misuse of Federal 
                student aid from any source.
                    ``(D) A violation of section 487(a)(20).
                    ``(E) A violation of the default manipulation 
                regulations promulgated by the Secretary under section 
                435(m)(3).
                    ``(F) Failure to comply with the program review 
                process described in section 498A, including any 
                disclosure requirement described in paragraph (2)(C) or 
                (5) of section 498A(b).
                    ``(G) A violation of the program integrity 
                regulations promulgated by the Secretary under this 
                Act.
                    ``(H) A violation of this Act that the Secretary 
                has determined, by regulation, to be a serious 
                violation for purposes of this section.''.

SEC. 14. REQUIREMENTS FOR ACCREDITING AGENCIES OR ASSOCIATIONS.

    Section 496(a) of the Higher Education Act of 1965 (20 U.S.C. 
1099b(a)) is amended--
            (1) in paragraph (7), by striking ``and'' after the 
        semicolon;
            (2) in paragraph (8), by striking the period and inserting 
        ``; and''; and
            (3) by adding at the end the following new paragraph:
            ``(9) such agency or association does not require any 
        institution to enter into predispute arbitration agreements 
        with the students of the institution.''.

SEC. 15. PROGRAM REVIEW AND DATA.

    Section 498A of the Higher Education Act of 1965 (20 U.S.C. 1099c-
1) is amended to read as follows:

``SEC. 498A. PROGRAM REVIEW AND DATA.

    ``(a) Program Reviews for Institutions Participating Under Title 
IV.--
            ``(1) In general.--The Secretary--
                    ``(A) may conduct program reviews, including on-
                site visits, of each institution of higher education 
                participating in a program authorized under this title; 
                and
                    ``(B) shall conduct a program review under this 
                subsection of each institution of higher education that 
                poses a significant risk of failure to comply with this 
                title, as described in paragraphs (2) and (3).
            ``(2) Mandatory reviews.--
                    ``(A) In general.--The Secretary shall, on an 
                annual basis, conduct program reviews of each 
                institution of higher education participating in a 
                program authorized under this title that meets 1 or 
                more of the following criteria:
                            ``(i) The Secretary determines that--
                                    ``(I) more than 15 percent of the 
                                students enrolled at the institution 
                                have received a Federal Direct 
                                Unsubsidized Stafford Loan during the 
                                previous year; and
                                    ``(II) the institution has a cohort 
                                default rate, as defined in section 
                                435(m), that is more than 20 percent.
                            ``(ii) The Secretary determines that--
                                    ``(I) the institution has a cohort 
                                default rate, as defined in section 
                                435(m), that exceeds the national 
                                average, as determined by the Secretary 
                                in accordance with such section; and
                                    ``(II) the institution has an 
                                aggregate amount of defaulted loans, as 
                                determined by the Secretary, that 
                                places the institution in the highest 1 
                                percent of institutions participating 
                                in programs authorized under this title 
                                in terms of the aggregate amount of 
                                defaulted loans.
                            ``(iii) In the case of proprietary 
                        institutions of higher education, the 
                        institution received more than 80 percent of 
                        the institution's revenues from Federal funds 
                        as defined in section 166(2), during the 2 most 
                        recent years for which data is available.
                            ``(iv) The institution is among the top 1 
                        percent of institutions participating in 
                        programs authorized under this title in terms 
                        of numbers or rates of complaints related to 
                        Federal student financial aid, educational 
                        practices and services, or recruiting and 
                        marketing practices, as reported in the 
                        complaint tracking system established under 
                        section 161.
                            ``(v) As of the date of the determination, 
                        the institution is among the top 1 percent of 
                        institutions in terms of low graduation rates, 
                        as determined by the Secretary, of all 
                        institutions participating in programs 
                        authorized under this title.
                            ``(vi) The institution spends more than 20 
                        percent of the institution's revenues on 
                        recruiting and marketing activities and 
                        executive compensation.
                            ``(vii) In the fiscal year immediately 
                        following the most recent cohort default rate 
                        period--
                                    ``(I) the institution's loan 
                                defaults increased by 50 percent or 
                                more as compared to the preceding 
                                period; and
                                    ``(II) more than 50 percent of the 
                                students attending the institution 
                                received loans under this title.
                            ``(viii) The institution, or an executive 
                        of the institution, has publicly acknowledged 
                        or disclosed that the institution--
                                    ``(I) is in violation or 
                                noncompliance with any provision of law 
                                administered by a relevant Federal 
                                agency or relevant State entity or 
                                agency; or
                                    ``(II) is being investigated 
                                regarding a potential violation of such 
                                provision of law.
                            ``(ix) The institution--
                                    ``(I) is a proprietary institution 
                                of higher education that has acquired a 
                                nonprofit institution of higher 
                                education at any point during the 1-
                                year period preceding the date of the 
                                determination; or
                                    ``(II) was a proprietary 
                                institution of higher education and has 
                                become a nonprofit institution of 
                                higher education at any time during the 
                                1-year period preceding the date of the 
                                determination.
                    ``(B) Publication of institutions reviewed.--The 
                Secretary shall--
                            ``(i) post, on a publicly available 
                        website, the name of each institution of higher 
                        education that is reviewed under subparagraph 
                        (A);
                            ``(ii) indicate, on such website, with 
                        respect to each such institution, which of the 
                        mandatory review criteria, as described in 
                        subparagraph (A), such institution met; and
                            ``(iii) indicate on the College Navigator 
                        website of the Department, or any successor 
                        website, the name of each institution of higher 
                        education that is reviewed under subparagraph 
                        (A).
                    ``(C) Institutional disclosure of review.--Each 
                institution of higher education that is reviewed under 
                subparagraph (A) shall--
                            ``(i) post on the home page of the 
                        institution's website that the institution will 
                        be subject to a mandatory program review and 
                        why the institution is being reviewed and shall 
                        maintain such posting and explanation for 1 
                        year or until the Secretary has issued its 
                        final program review report under subsection 
                        (c)(5)(C), whichever occurs sooner;
                            ``(ii) provide a clear, conspicuous 
                        disclosure of the information described in 
                        clause (i) to students who inquire about 
                        admission to the institution or submit an 
                        application for admission to the institution 
                        prior to the student signing an enrollment 
                        agreement with the institution, for 1 year or 
                        until the Secretary has issued the final 
                        program review report under subsection 
                        (c)(6)(C), whichever occurs sooner; and
                            ``(iii) include the information described 
                        in clause (i) on materials of acceptance or 
                        admission submitted to each student before the 
                        student enrolls in the institution, for 1 year 
                        or until the Secretary has issued the final 
                        program review report under subsection 
                        (c)(6)(C), whichever occurs sooner.
            ``(3) Risk-based reviews.--
                    ``(A) In general.--The Secretary shall use a risk-
                based approach to select, on an annual basis not less 
                than 2 percent of institutions of higher education 
                participating in a program authorized under this title 
                that are not reviewed under paragraph (2), for a 
                program review. Such approach shall prioritize program 
                reviews of institutions that--
                            ``(i) have received large increases in 
                        funding under this title during the 5-year 
                        period preceding the date of the determination;
                            ``(ii) have a large proportion of overall 
                        revenue from Federal funds, as defined in 
                        section 166(2);
                            ``(iii) have a significant fluctuation in 
                        Federal Direct Stafford Loan volume, Federal 
                        Pell Grant award volume, or any combination 
                        thereof, in the year for which the selection is 
                        made, compared to the year prior to such year, 
                        that is not accounted for by changes in the 
                        Federal Direct Stafford Loan program, the 
                        Federal Pell Grant program, or any combination 
                        thereof;
                            ``(iv) have experienced sharp increases in 
                        enrollment in absolute numbers or rate of 
                        growth;
                            ``(v) have high rates of defaults, relative 
                        to all other institutions of higher education 
                        participating in a program authorized under 
                        this title, for loans issued under this title 
                        over the lifetime of the loans;
                            ``(vi) have a large aggregate dollar amount 
                        of loans under this title in default, or a high 
                        cohort default rate as described in section 
                        435(m);
                            ``(vii) have a high student default risk, 
                        as compared to the student default risk for all 
                        institutions participating in a program under 
                        this title;
                            ``(viii) have a high proportion or high 
                        rate of complaints related to Federal student 
                        financial aid, educational practices and 
                        services, or recruiting and marketing 
                        practices, as reported in the complaint 
                        tracking system established under section 161;
                            ``(ix) have extremely low graduation rates, 
                        as determined by the Secretary;
                            ``(x) are in poor financial health 
                        according to financial responsibility standards 
                        described in section 498(c);
                            ``(xi) are spending a large percentage of 
                        the institution's revenues on recruiting and 
                        marketing activities and executive 
                        compensation;
                            ``(xii) in the case of proprietary 
                        institutions of higher education, have large 
                        profit margins and profit growth;
                            ``(xiii) have been put on notice, warning, 
                        or probation by, or is subject to a show cause 
                        order from, a nationally recognized accrediting 
                        agency or association that is recognized by the 
                        Secretary pursuant to part H of title IV;
                            ``(xiv) has been found to have compliance 
                        problems under this title, or is at significant 
                        risk of failing to comply with applicable 
                        Federal or State laws, by a relevant Federal 
                        agency or a relevant State entity or agency, 
                        including the Comptroller General of the United 
                        States;
                            ``(xv) has had a large amount of funds 
                        returned under section 484B; or
                            ``(xvi) in the case of proprietary 
                        institutions of higher education, have 
                        experienced a change in ownership or control of 
                        the institution, including a buyout.
                    ``(B) Criteria for risk-based reviews.--The 
                Secretary shall publish, and update as necessary, the 
                specific criteria that the Secretary will use to 
                determine which institutions of higher education are 
                selected for risk-based reviews under subparagraph (A).
            ``(4) Public disclosure of violations.--The Secretary 
        shall--
                    ``(A) post on the College Navigator website, or any 
                successor website, of the Department, the name of each 
                institution of higher education that is found to have 
                violated a provision of this title knowingly and 
                willfully or with gross negligence;
                    ``(B) indicate on such website, with respect to 
                each such institution, which of the provisions of this 
                title the institution violated; and
                    ``(C) maintain such posting until the date the 
                institution of higher education rectifies the violation 
                or the date that is 1 year after the date the Secretary 
                issues the final program review report under subsection 
                (c)(6)(C) with respect to such institution, whichever 
                date is later.
            ``(5) Institutional disclosure of violations.--Each 
        institution of higher education that is found to have violated 
        a provision of this title knowingly and willfully or with gross 
        negligence shall--
                    ``(A) not later than 15 days after the date of 
                issuance of the final program review report containing 
                the finding, post on the home page of the institution's 
                website that the institution has been found to have 
                violated a provision of this title knowingly and 
                willfully or with gross negligence, including the 
                provision the institution was found to have violated;
                    ``(B) maintain such posting until the date the 
                institution rectifies the violation or the date that is 
                1 year after the date the Secretary issues the final 
                program review report under subsection (c)(6)(C) with 
                respect to such institution, whichever date is later; 
                and
                    ``(C) include the information described in 
                subparagraph (A) on materials of acceptance or 
                admission submitted to each student before the student 
                enrolls in the institution until the date the 
                institution rectifies the violation or the date that is 
                1 year after the date the Secretary issues the final 
                program review report under subsection (c)(6)(C) with 
                respect to such institution, whichever date is later.
    ``(b) Characteristics of Program Reviews.--
            ``(1) Notice.--The Secretary may give not more than 72 
        hours notice to an institution of higher education that will 
        undergo a program review pursuant to subsection (b) of such 
        review.
            ``(2) Sharing of information.--The Secretary shall share 
        all final program review determinations conducted under this 
        section with relevant Federal agencies and relevant State 
        entities or agencies, and appropriate accrediting agencies and 
        associations, to enable such agencies, entities, and 
        associations to determine the eligibility of institutions for 
        funds or accreditation.
            ``(3) Interaction with other federal agencies and laws.--To 
        the extent practicable, the Secretary shall coordinate program 
        reviews conducted under this section with other reviews and 
        audits conducted by the Department, and with relevant Federal 
        agencies and relevant State entities or agencies.
            ``(4) Violations discovered through program review.--
                    ``(A) Violations of this title.--If, in the course 
                of conducting a program review, the Secretary obtains 
                evidence that any institution of higher education or 
                person has engaged in conduct that may constitute a 
                violation of this title, including a failure to fully 
                comply with the program review process and reporting 
                requirements under this section, the Secretary may 
                sanction such institution or person, pursuant to 
                section 489A.
                    ``(B) Violations of other federal laws.--If, in the 
                course of conducting a program review, the Secretary 
                obtains evidence that any institution of higher 
                education or person has engaged in conduct that may 
                constitute a violation of Federal law, the Secretary 
                shall transmit such evidence to the Attorney General of 
                the United States, the Director of the Bureau of 
                Consumer Financial Protection, the Commissioner of the 
                Federal Trade Commission, or the head of any other 
                appropriate Federal agency who may institute 
                proceedings under appropriate law.
                    ``(C) Rule of construction.--Nothing in this 
                paragraph shall be constructed to affect any other 
                authority of the Secretary to disclose information.
            ``(5) Conduct of reviews.--When conducting program reviews 
        under this section, the Secretary shall assess the institution 
        of higher education's compliance with the provisions of this 
        title. Each program review shall include, at a minimum, the 
        following:
                    ``(A) With regard to the institutional information, 
                the Secretary shall assess financial capability, 
                administrative capability, and program integrity, 
                including whether the institution--
                            ``(i) knowingly and willfully misused 
                        Federal student aid from any source;
                            ``(ii) violated section 487(a)(20);
                            ``(iii) engaged in any substantial 
                        misrepresentation or other serious violation, 
                        as defined in section 489A; or
                            ``(iv) violated the program integrity 
                        regulations promulgated by the Secretary under 
                        this Act.
                    ``(B) With regard to student information, the 
                Secretary shall examine--
                            ``(i) graduation rates compared with all 
                        other institutions participating in a program 
                        authorized under this title;
                            ``(ii) student complaints, including 
                        interviews with current and former students, 
                        faculty and staff, and accrediting agencies; 
                        and
                            ``(iii) information from the complaint data 
                        system established under section 161.
            ``(6) Administrative process.--
                    ``(A) Training.--The Secretary shall provide 
                training, including investigative training, to 
                personnel of the Department designed to improve the 
                quality of financial and compliance audits and program 
                reviews conducted under this section, including 
                instruction about appropriately and effectively 
                conducting such audits and reviews for institutions of 
                higher education from different sectors of higher 
                education.
                    ``(B) Carrying out program reviews.--In carrying 
                out program reviews under this section, the Secretary 
                shall--
                            ``(i) establish guidelines designed to 
                        ensure uniformity of practice in the conduct of 
                        such reviews;
                            ``(ii) make available to each institution 
                        of higher education participating in a program 
                        authorized under this title complete copies of 
                        all review guidelines and procedures used in 
                        program reviews, except that internal training 
                        materials for Department staff related to 
                        identifying instances of fraud, 
                        misrepresentation, or intentional noncompliance 
                        shall not be disclosed;
                            ``(iii) permit an institution of higher 
                        education to correct or cure an administrative, 
                        accounting, or recordkeeping error within 90 
                        days of the issuance of the final program 
                        review report, if the error is not part of a 
                        pattern of error and there is no evidence of 
                        fraud or misconduct related to the error;
                            ``(iv) without sharing personally 
                        identifiable information and in accordance with 
                        section 444 of the General Education Provisions 
                        Act (20 U.S.C. 1232g, commonly known as the 
                        `Family Educational Rights and Privacy Act of 
                        1974'), inform the relevant Federal agencies 
                        and relevant State entities or agencies, and 
                        accrediting agency or association, whenever the 
                        Secretary finds a violation of this title or 
                        sanctions an institution of higher education 
                        under section 432, 489A, or 498; and
                            ``(v) provide to an institution of higher 
                        education 90 calendar days to review and 
                        respond to any program review report and 
                        relevant materials related to the report before 
                        any final program review report is issued.
                    ``(C) Final program review determination.--
                            ``(i) In general.--Not later than 180 
                        calendar days after issuing a program review 
                        report under this section, the Secretary shall 
                        review and consider an institution of higher 
                        education's response, and issue a final program 
                        review determination or audit determination. 
                        The final determination shall include--
                                    ``(I) a written statement 
                                addressing the institution of higher 
                                education's response;
                                    ``(II) a written statement of the 
                                basis for such determination; and
                                    ``(III) a copy of the institution's 
                                response.
                            ``(ii) Confidentiality.--The Secretary 
                        shall maintain and preserve at all times the 
                        confidentiality of any program review report 
                        until a final program review determination is 
                        issued, other than to inform the relevant 
                        Federal agencies and relevant State entities or 
                        agencies, and accrediting agency or 
                        association, as required under this section.
                    ``(D) Reports disclosed to the institution.--The 
                Secretary shall promptly disclose each program review 
                report and each final program review determination to 
                the institution of higher education under review.
                    ``(E) Removal of personally identifiable 
                information.--Any personally identifiable information 
                from the education records of students shall be removed 
                from any program review report or final program review 
                determination before the report is shared with any 
                relevant Federal agency, State entity or agency, or 
                accrediting agency or association.
            ``(7) Follow-up reviews after violations.--The Secretary 
        shall conduct follow-up reviews of each institution of higher 
        education that has been found in violation of a provision of 
        this title not later than 1 year after the date of such 
        finding. Such follow-up reviews may only assess whether the 
        institution of higher education has corrected violations found 
        in a previous program review or final program review 
        determination.
    ``(c) Definitions.--In this section:
            ``(1) Executive compensation.--The term `executive 
        compensation', when used with respect to an institution of 
        higher education, means the wages, salary, fees, commissions, 
        fringe benefits, deferred compensation, retirement 
        contributions, options, bonuses, property, and any other form 
        of remuneration that the Secretary determines is appropriate, 
        given to the 5 percent of employees at the institution who are 
        the highest compensated.
            ``(2) Relevant federal agency.--The term `relevant Federal 
        agency' means--
                    ``(A) the Department of Education;
                    ``(B) the Department of Veterans Affairs;
                    ``(C) the Department of Defense;
                    ``(D) the Bureau of Consumer Financial Protection;
                    ``(E) the Federal Trade Commission; or
                    ``(F) any other Federal agency that provides 
                Federal student assistance or that the Secretary 
                determines appropriate.
            ``(3) Relevant state entity or agency.--The term `relevant 
        State entity or agency' means--
                    ``(A) an appropriate State licensing or authorizing 
                agency;
                    ``(B) the attorney general (or the equivalent 
                thereof) of the State; or
                    ``(C) any other State entity or agency that the 
                Secretary determines appropriate.''.

SEC. 16. CONSUMER PROTECTIONS FOR STUDENTS.

    (a) Definitions.--In this section:
            (1) Federal financial assistance program.--The term 
        ``Federal financial assistance program'' means a program that 
        provides Federal education assistance funds, as described in 
        section 103 of the Higher Education Act of 1965 (20 U.S.C. 
        1003), to any postsecondary educational institution.
            (2) Postsecondary educational institution.--The term 
        ``postsecondary educational institution'' means an educational 
        institution that awards a degree or certificate and is located 
        in any State and includes--
                    (A) an institution of higher education, as defined 
                in section 102 of the Higher Education Act of 1965 (20 
                U.S.C. 1002);
                    (B) a postsecondary educational institution, as 
                defined in section 203 of the Adult Education and 
                Family Literacy Act (29 U.S.C. 3272); and
                    (C) an educational institution, as defined under 
                section 3452 of title 38, United States Code.
            (3) State.--
                    (A) State.--The term ``State'' includes, in 
                addition to the several States of the United States, 
                the Commonwealth of Puerto Rico, the District of 
                Columbia, Guam, American Samoa, the United States 
                Virgin Islands, the Commonwealth of the Northern 
                Mariana Islands, and the freely associated States.
                    (B) Freely associated states.--The term ``freely 
                associated States'' means the Republic of the Marshall 
                Islands, the Federated States of Micronesia, and the 
                Republic of Palau.
    (b) Consumer Protections.--Notwithstanding any other provision of 
law, a postsecondary educational institution is not eligible to 
participate in a Federal financial assistance program with respect to 
any program of postsecondary education or training, including a degree 
or certificate program, that is designed to prepare students for entry 
into a recognized occupation or profession that requires licensing or 
other established requirements as a pre-condition for entry into such 
occupation or profession, unless--
            (1) the successful completion of the program fully 
        qualifies a student, in the Metropolitan Statistical Area in 
        which the student resides, to--
                    (A) take any examination required for entry into 
                the recognized occupation or profession in the 
                Metropolitan Statistical Area in which the student 
                resides, including satisfying all State or 
                professionally mandated programmatic and specialized 
                accreditation requirements, if any; and
                    (B) be certified or licensed or meet any other 
                academically related pre-conditions that are required 
                for entry into the recognized occupation or profession 
                in the Metropolitan Statistical Area in which the 
                student resides; and
            (2) the institution offering the program provides timely 
        placement for all of the academically related pre-licensure 
        requirements for entry into the recognized occupation or 
        profession in the Metropolitan Statistical Area in which the 
        student resides, such as clinical placements, internships, or 
        apprenticeships.
    (c) Effective Date.--This section shall take effect on the date 
that is 180 days after the date of the enactment of this Act.
                                 <all>