The U.S. Department of Education will end its federal student aid support for two Minnesota-based colleges, Globe University and Minnesota School of Business (MSB).
 
Both for-profit institutions, which are owned and operated by Terry Myhre, have been in hot water this year. In early September, a Hennepin County judge ruled that Woodbury-based Globe and Blaine-based MSB committed fraud related to high-pressure sales tactics used in recruiting students.
 
Students who paid for programs at the colleges earned credits that in many cases would not transfer to other academic institutions, ultimately leaving some graduates incapable of landing employment in their intended field of work.
 
Moreover, in September, the Minnesota Office of Higher Education revoked both schools’ license to operate. Globe and MSB, however, were allowed to continue teaching through the 2016-2017 school year.
 
Globe and MSB followed up by saying the institutions would fight the accusations, yet would not be accepting enrollment applications at all Minnesota campuses for the fall 2017 semester.
 
In its ruling Tuesday, the Department of Education said its denial of federal aid support to Globe and MSB would become effective at the end of 2016. Students taking classes at either institution during the spring 2017 semester will not have access to federal aid, such as Pell Grants or Direct Loans, to pursue their studies.
 
Globe, which enrolls approximately 1,000 students at 10 locations in Minnesota, Wisconsin and South Dakota, was awarded $28.4 million in federal student aid during the 2014-2015 school year. MSB, which enrolls about 700 students at nine locations throughout Minnesota, received $25.5 million during the same time period.
 
Both schools were told they have until December 20 to submit evidence to dispute the Department of Education’s findings.
 
“These callous acts of misrepresentation left many students without the credentials necessary for their chosen careers and no options to continue their studies at other post secondary institutions,” the Department of Education said in its report. “Many graduates incurred thousands of dollars of debt but had limited options for successful job placement in their chosen fields.”
 
U.S. Under Secretary of Education Ted Mitchell added that Globe and MSB also “preyed upon potential public servants” and “abused taxpayer funds” as part of its fraudulent activities.
 
Globe or MSB did not return comment by press time regarding today’s enforcement from the Department of Education.

Like what you just read? To receive business news directly in your inbox each Tuesday and Thursday, sign up for our free e-newsletter, Briefcase, and be sure to join the conversation by commenting below.