The U.S. Department of Education announced Wednesday that it is barring a major national accreditor of beauty and career arts schools from adding new members to its roster, placing the organization on formal notice that it could face much more severe federal penalties if it fails to resolve a wide array of compliance and oversight concerns.
The decision targets the National Accrediting Commission of Career Arts and Sciences, commonly known as NACCAS, which currently holds federal recognition to accredit more than 1,000 career-focused programs and institutions, with a heavy concentration in cosmetology, esthetics, and other beauty arts. Under the terms of the department’s ruling, NACCAS is prohibited from taking on any new member institutions, effectively freezing approximately 300 pending applications until the agency proves it has corrected multiple findings of noncompliance.
This federal restriction follows a high-stakes confrontation that played out during a July meeting of the National Advisory Committee on Institutional Quality and Integrity, an independent panel that advises the Department of Education on matters of institutional accreditation. During that session, advisory committee members closely questioned NACCAS officials regarding transparency deficiencies, subpar student outcomes, and other systemic issues within the cosmetology accreditor. The interrogation culminated in a 9-to-3 vote by NACIQI members recommending that the Department of Education strip NACCAS of its federal recognition entirely.
Accreditation from an agency recognized by the federal government serves as a crucial gateway, unlocking access to federal student financial aid programs for institutions and their enrolled students. Without it, most career schools would struggle to survive, as their students rely heavily on federal loans and grants to pay for tuition and supplies.
While the advisory committee’s recommendation would have completely terminated NACCAS’s authority, the final decision ultimately rested with the Education Department. Rather than going as far as full derecognition, Under Secretary Nicholas Kent opted for a targeted growth restriction, halting about 300 pending institutional applications while giving the accreditor a timeline to address documented shortcomings.
Central to the concerns raised by department staff and the advisory committee was NACCAS’s failure to independently monitor whether its member institutions had been placed under sanctions or faced disciplinary actions by other outside regulatory and oversight agencies.
In his official decision letter, Under Secretary Kent underscored the seriousness of this oversight gap. He wrote that if NACCAS is unable to adequately monitor its existing member institutions—or prospective institutions—to a sufficient level that ensures clear awareness of actions taken by outside actors, it raises serious questions about whether the organization has simply reached an unsustainable scale.
Kent’s decision marks the second time this year that the under secretary has chosen to overrule a recommendation from NACIQI to strip an accreditor of its federal recognition. In March, NACIQI members voted unanimously, 12 to zero, to recommend that the department decline to renew federal recognition for the Council on Naturopathic Medical Education. However, in June, Kent opted to extend recognition for the CNME for another year on a conditional basis.
Concurrently on Wednesday, the Department of Education imposed similar growth restrictions on the Council on Occupational Education, barring it from taking on new members and halting pending applications. In that separate case, Kent actually went further than NACIQI had recommended, as the advisory panel members had not sought any formal actions against the accreditor beyond requesting additional compliance reports.
During the July hearings, NACCAS officials argued that given the sheer volume of programs and schools it oversees, stripping the organization of its federal recognition would deal a catastrophic blow to the institutions and the students they serve. However, the Education Department firmly rejected the notion that the accreditor is simply too big to fail.
Kent emphasized in his decision that, given the organization’s massive footprint, allowing it to continue operating under its current practices presented an even greater risk to students and taxpayers alike. He warned that a severe lack of proper oversight and a failure to ensure that member institutions are delivering a quality education could ultimately lead to significant increases in student loan nonpayment and default rates if the agency continued evaluating schools in such an inadequate manner.
Despite the severity of the restrictions, Kent provided NACCAS with a 12-month window to address the identified compliance concerns. His decision to spare the organization from immediate derecognition stemmed from an expressed faith in the accreditor’s capacity to implement necessary reforms.
Writing in his decision letter, Kent noted that he does believe NACCAS is capable of taking corrective action to address these serious concerns at this time, though he simultaneously stressed his belief that the organization should not be permitted to continue adding new institutions while doing so.
Officials representing NACCAS did not respond to requests for comment from Inside Higher Ed following the department’s announcement.
The department’s decision drew praise from higher education policy experts and researchers who have long advocated for stricter federal oversight of accrediting agencies, particularly those overseeing the for-profit career school sector. Preston Cooper, a senior fellow at the American Enterprise Institute who has previously published papers calling on federal officials to take a tougher stance on accreditors like NACCAS, welcomed the department’s actions.
Cooper noted that NACCAS has historically struggled to maintain rigorous standards regarding student achievement and outcomes, making intervention by the Education Department both appropriate and necessary. While acknowledging that full derecognition was an outcome he personally would have been glad to see, he emphasized that stopping the accreditor from adding new institutions still represents a major, powerful step forward in holding accrediting bodies accountable. Cooper expressed hope that the department will view this enforcement mechanism as a viable tool to utilize with other accreditors that may also be falling short of upholding high standards for student success.
Jeremy Bauer-Wolf, investigations manager for the higher education program at New America—a think tank that has previously published critical reports examining NACCAS—simultaneously voiced strong support for the decision. He pointed to ongoing struggles within the sector to maintain educational quality and protect consumers.
Recalling an undercover investigation and secret shopping effort conducted by New America at several NACCAS-accredited beauty schools last year, Bauer-Wolf noted that institutions routinely provided prospective students with inaccurate or incomplete information. He emphasized that even when such miscommunications stem from administrative mistakes rather than malicious intent, they can still profoundly mislead students and distort life-changing educational and financial decisions. He described the department’s restrictive action as gratifying.
Despite hailing from think tanks positioned at different points on the political spectrum, both Cooper and Bauer-Wolf arrived at a shared consensus: many of the institutions operating under NACCAS accreditation are failing to deliver adequate returns for their students, while the accreditor itself has consistently failed to hold its members accountable for poor outcomes.
Industry observers note that even with the reprieve granted by the Department of Education, a number of NACCAS member institutions may face imminent closure in the near future. These closures are anticipated as schools struggle to meet upcoming federal earnings tests designed to evaluate whether graduates earn enough to pay down their educational debts, a metric that could restrict institutional eligibility for federal student aid programs. Recent federal data suggests that more than 90 percent of undergraduate certificate programs in cosmetology are projected to fail these upcoming earnings benchmarks.
Bauer-Wolf argued that the entire sector of institutions operating under NACCAS accreditation is in urgent need of a comprehensive overhaul. Drawing on research conducted by his organization, he pointed out that beauty schools, particularly those operating within large for-profit chains, frequently fail to channel students into stable, quality employment that generates sufficient income to comfortably pay off the debts accumulated to finance their training.
