UNITED STATES DEPARTMENT OF EDUCATION
WASHINGTON, D.C. 20202
In the Matter of Docket No. 98-104-ST
Respondent participates in the Pell Grant and Federal Family Education Loan (FFEL)
programs authorized under Title IV of the Higher Education Act of 1965, as amended. On July
2, 1998, the Student Financial Assistance Programs (SFAP), U.S. Department of Education,
notified Respondent of its intent to terminate Respondent's eligibility to participate in all student
assistance programs authorized under Title IV based on Respondent's FFEL cohort default rate
for fiscal year 1995, which SFAP contends is 41.2 percent. Respondent requested a hearing
under 34 C.F.R. Part 668, Subpart G.
Under 34 C.F.R. § 668.90 (a)(3)(iv) (1998), if Respondent's FFEL cohort default rate for
any fiscal year exceeds 40 percent, and is a final rate arrived at under 34 C.F.R. § 668.17 (1998),
I must find that the remedy proposed by SFAP, i.e., termination, is warranted. See Aladdin
Beauty College # 32, Docket No. 97-108-ST, U.S. Dept. of Educ. (Order of the Secretary, Aug.
20, 1998). SFAP submitted a brief and exhibits in support of its position. Respondent declined
to submit a brief or exhibits.
The record in this case supports SFAP's contention that Respondent's FFEL cohort
default rate for fiscal year 1995 was 41.2 percent, and that it was a final rate arrived at under
section 668.17. The record further indicates that SFAP seeks Respondent's termination from
participation in all programs authorized under Title IV. Thus, I have no discretion but to order
2. SFAP seeks an order terminating Respondent's eligibility to participate in all
programs authorized under Title IV of the Higher Education Act of 1965, as amended.
Frank K. Krueger, Jr.
Dated: October 27, 1998
A copy of this decision was sent by certified mail, return receipt requested, to the following:
Pamela Gault, Esq.
Office of the General Counsel
U.S. Department of Education
600 Independence Avenue, S.W.
Washington, D.C. 20202-2110
Stacia Giaquinto, Vice President
15 Papineau Street
Holyoke, MA 01040