A Washington federal appeals court on Friday rejected the Consumer Financial Protection Bureau’s attempt to investigate an embattled accreditor of for-profit colleges, upholding a trial judge’s ruling that faulted the Obama-era agency for straying outside its jurisdiction.
In a unanimous ruling, a three-judge panel of the U.S. Court of Appeals for the D.C. Circuit said the CFPB’s subpoena—targeting the Accrediting Council of Independent Colleges and Schools—was overly vague. The appeals court did not take a position on whether a more narrowly tailored subpoena would be enforced.
The agency issued the administrative subpoena—known as a civil investigative demand—in August 2015 to the accrediting agency, a Washington-based organization that reviews schools for federal student aid funding. The U.S. Department of Education has since stripped the council’s power to review schools.
The CFPB asked the accrediting council to identify the schools it had accredited since January 2010 and name a representative to testify on the accreditations of seven specific colleges. The CFPB said it wanted “to determine whether any entity or person has engaged or is engaging in unlawful acts and practices in connection with accrediting for-profit colleges.”