Program Integrity regulations have led schools to change everything from marketing campaigns to internal policies. But with so much room for interpretation, it’s difficult to know what’s really necessary. Find out how schools are responding to the regulations, emerging best practices, and how your school can stay ahead of the compliance curve.

1. Reach, Recruit & Enroll
the Right Students
RESULTS OF THE 2012 HIGHER EDUCATION
COMPLIANCE SURVEY
Steve Smith, Managing Director of Product Management
Jeff Herz, Director of Compliance & Internal Operations

3. July 1: ED Program Integrity Regulations
• Broad Misrepresentation rules cover any inaccurate
content
• Any company that directly or indirectly has a relationship
with the school is affected
• Serious Ramifications for schools
• Title IV eligibility suspended/revoked
• Heavy fines
• Reputational risks

4. CUnet Compliance Survey Methodology
• GOAL = Benchmark how schools are dealing with the regulations
• Conducted in October-November 2011 among 51 professionals
working in for-profit schools
• Average online student enrollment was 6,222;average on-campus
student enrollment was 5,744
12.0% Publicly
Traded
88.0%
Not Publicly
Traded

5. Survey Results – Compliance Guidelines
• Not everyone is ready to deal with the regulations; nearly 1 in 5
schools has not even updated their compliance guidelines

6. Survey Results – Staffing Changes
• Nearly all schools (96%) have added new staffing
resources to address compliance
What Staffing Changes Have You Made to Deal with Regulatory Compliance?
100% 7% 7%
16%
18% Don't Know/ Not Applicable
80% 36% No plans
11%
38%
60% In process
18% Completed
40% 18%
64%
20% 40%
29%
0%
Hired internal Hired third- Increased your reliance
compliance staff party/agency on agency/partner

7. Survey Results: Contract Changes
• Schools (86%) are holding their vendors accountable
through their pocketbooks, demanding transparency
and exerting more control
If your school renegotiated contracts with vendors, which terms were
impacted?
66.0%
64.0%
62.0%
60.0% 65.7%
62.9%
58.0%
56.0% 57.1% 57.1%
54.0%
52.0%
Indemnification Liability Creative approval Transparency
process

8. Survey Results: Vendor Response Times
• Schools are demanding that vendors respond quickly to
violations
• 69% require major violations to be resolved in under 24
hours; 10 percent allowing up to 48 hours for resolution.
Do you treat major and minor violations differently?
19.4% Yes
19.4% No
61.1%
Not sure

9. Survey Results: Vendor Changes
• Schools are not afraid to eliminate vendors that
represent a higher risk
Percentage of schools that have stopped working with vendors due to compliance
concerns
7%
29% 40%
Completed
In process
No plans
Don't Know/ Not Applicable
24%

10. Survey Results: Compliance Monitoring
• Nearly everyone recognizes the need for compliance
monitoring, yet fewer than 1/3 of respondents (31%)
have both manual & automated monitoring in place
Have you implemented compliance monitoring?
4%
100% 4% 18%
20%
80% 18%
Don't Know/ Not Applicable
60% 22% No plans
71%
In process
40%
Completed
42%
20%
0%
Added manual compliance Added automated
monitoring compliance monitoring

11. Survey Results: Overall Impressions
• Now that much of the dust has settled, it seems that most in the
industry see the regulatory changes as good for the sector at
large
67% agreed the regulations have been unfairly punitive to non-
profits
73% agreed the regulations represent necessary changes for
the sector, despite the challenges
56% agreed that the regulations will ultimately have a positive
impact on the quality of prospective inquiries from vendors

12. Key Takeaways
Schools are relying heavily on shifting accountability
over to vendors….
AND YET….
At the end of the day, schools are ultimately
the ones with the most to lose
in the case of a compliance breach.

13. Key Takeaways: What Should You Do Now?
1. The regulations are broad; simply renegotiating
vendor contracts may not be enough to mitigate risk.
2. Schools should invest in tools and strategies to
ensure their partners remain compliant.
3. The best defense is a comprehensive compliance
monitoring strategy consisting of tools, people &
processes.

14. CUnet’s Compliance Statement
• Committed to leadership in the quickly-evolving area of compliance through
significant investments in:
• People: Dedicated internal team of compliance experts (MOQC)
• Processes: Clearly defined set of operational processes to monitor,
enforce and address misrepresentation
• Technology: Significant investments in technology solutions, backed by
our industry-leading Sparkroom platform
• View CUnet’s complete compliance statement here:
http://cunet.co/compliance_statement

15. Compliance Best Practice
Phase 1 Phase 2 Phase 3 Phase 4

16. What is the Enforce Process?
FULLY MANAGED COMPLIANCE MONITORING

17. Violation Resolution: Example Timeline
Major Violations Examples
• Nature of educational
program.
• Nature of financial charges. The term “Fast Track” is in use without
the additional content that has to
• Employability of graduates. follow the phrase “in as little as 20
months”
• Relationship with the
Department of Education.
The ad below implies that the gvt is
providing grants for getting a degree
Penalties
• Affiliate paused immediately,
causing all inquiries sent to be
non-billable
• IO cancelled if violation is not
remedied within 5 days

18. Violation Resolution: Example Timeline
Minor Violations Examples
• Vague Language • “Science – Master’s Degree”
where the degree is “Masters
• Unauthorized Creative of Science Degree”
• Missing Accreditation • Outdated Logos
Penalties
• 5 days to get issue resolved
before affiliate is paused
• Campaign paused after 10
days until issue is resolved

19. Our Technology: Sparkroom Monitor
Software that supports the
compliance experts by:
• Storing URL information for
monitoring
• Crawling the URLs nightly and
comparing against previous
records
• When different, take an image
snapshot and copy HTML for
change analysis
• Recording when manual audits
are performed

20. Enforce: Case Study
CUnet Enforce Case Study Count
Pages Reviewed and Audited 5459
Total number of unique URL’s monitored 1259
New URL's proactively found with Violations 165
Total Violations Identified 604
Open Violations 91
Major Violations identified 19
Minor Violations identified 72

21. Enforce: Case Study Violations
Unauthorized Client Breakdown Of Violations
branded copy or creative
7%
Missing required
field
14%
Missing Accreditation / Nature of Education
Disclaimer Program
14% 65%

22. Special Offer for LeadsCon Attendees
Get a Free Compliance Review from CUnet
• Reviewing existing compliance process
• CUnet will run your URL list through Sparkroom
Monitor, identifying areas of risk
• CUnet will provide overall page scores, list of banned
terms found and an overall risk assessment
• If you are interested, please contact:
• Jeff Herz (jeff.herz@cunet.com) 201-477-7793

23. Questions?
For additional questions:
Jeff Herz
jeff.herz@cunet.com
201.477.7793
Steve Smith
steve. smith@cunet.com
416.323.1366 x 41224