Is the National Association for College Admission Counseling (NACAC) violating federal antitrust laws? The United States Department of Justice has launched an investigation into whether or not NACAC is doing just this in their ethics code, which the organization — to which Ivy Coach is a member — terms the “Statement of Principles of Good Practice.” As we’ve previously expressed on the pages of our college admissions blog, we are not surprised that the DOJ would launch an investigation into NACAC’s ethics code since the organization does not have the legal right to restrain the trade of, say, two colleges trying to compete over one student. As an example, a college may wish to guarantee on-campus housing to a student if she responds she’ll matriculate by a certain date. Any organization that banned colleges from offering such an incentive in the hope of wooing a student to matriculate would, arguably, be interfering with our free markets. We’ve been publicly calling out the Independent Educational Consultants Association (IECA), an inferior organization to NACAC, for restraining trade for years so you could say we follow these antitrust matters in the field of college admissions quite closely.
DOJ Probes NACAC for Potentially Restraining Trade
And it seems we’re not alone. We came across the blog of a financial advisor who has a strong opinion or two about organizations like NACAC and IECA that are potentially violating federal antitrust law. We don’t typically read financial blogs since they are more likely than not to lull us to sleep but this particular post drew our attention. As Larry Elkin articulates in his post entitled “An Overdue Look at College Admissions Collusion,” “American colleges and universities actually do engage in a broad array of anti-competitive practices, making the Justice Department’s action both justified and, in my opinion, long overdue. Sen. Marco Rubio, R-Fla., once referred to colleges and universities as a ‘cartel,’ a descriptor that they have done much to earn. He was specifically discussing accreditation – a pressing issue, though not the one the Justice Department is currently considering – but the characterization holds in a wider consideration of their practices.”
Elkin continues, “The National Association for College Admission Counseling’s so-called ethics code purports to protect the interests of colleges, high schools and students. This itself is problematic, since the interests of these three groups conflict in some ways, and only one of those groups – guess which one – is involved in writing the code. Moreover, schools that don’t abide by the rules in the ethics code may face serious sanctions, including exclusion from NACAC’s popular recruitment fairs. So schools are encouraged to treat one another ‘fairly’ by adopting widespread rules about how admission processes should run.”
We Believe the IECA Restrains Trade
Amen Larry Elkin! Well said. Now if you could please write about the ethics code of the Independent Educational Consultants Association, termed its “Principles of Good Practice,” in your next post, we’d be happy to provide you letters that clearly demonstrate an unsuccessful attempt by their organization to restrain our trade. Indeed they tried to tell us what we could and couldn’t charge, deeming our fees to be “expensive.” But of course what is “expensive” to some is not necessarily “expensive” to others. Perhaps the organization didn’t realize that such attempts to tell us what we could and couldn’t charge (as detailed in Parts I, II, and III of our exposé on the organization) were, in our opinion, an attempt to restrain our trade in violation of our free market system. We clapped back. Oh yes, yes we did.
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