Sotheby's Institute of Art on Department of Education's Heightened Cash Monitoring 2 List

Sotheby's Institute of Art (SIA) in New York City is one of only three institutions under the US Department of Education's Heightened Cash Monitoring 2 list for "financial responsibility" problems. 

SIA is owned by Cambridge Information Group, which is the parent company of ProQuest, The School of the New York Times, Hammond's Candies, the Scranton/Wilkes-Barre RailRiders minor league baseball team, and other investments. 

(Seven NY institutions were under HCM2. Source: US Department of Education)

According to the US Department of Education (ED), "schools may be placed on HCM1 or HCM2 as a result of compliance issues including but not limited to accreditation issues, late or missing annual financial statements and/or audits, outstanding liabilities, denial of re-certifications, concern around the school's administrative capabilities, concern around a school's financial responsibility, and possibly severe findings uncovered during a program review."

Also according to ED, "a school placed on HCM2 no longer receives funds under the Advance Payment Method. After a school on HCM2 makes disbursements to students from its own institutional funds, a Reimbursement Payment Request must be submitted for those funds to the Department." Schools in this position are often in such financial hardship that they may close.  

The September 2023 Heightened Cash Monitoring 2 list includes less than 100 schools nationwide and seven schools in New York. A disproportionate number of schools are small religious-based institutions and for-profit vocational colleges. 

Unlike most of the schools on the HCM list, Sotheby's has a prestigious name--and it uses its relationship with the auction house to elevate its brand. According to its vision statement, "Sotheby’s Institute of Art is the global leader in art world education, shaping future generations of cultural stewards and art market professionals."  

And according to its website "Sotheby’s Institute of Art alumni form a network of over 8,000 talented individuals around the world. Our graduates hold leading positions at renowned international arts organisations including Frieze, 1-54 Contemporary African Art Fair, M+, the Institute of Contemporary Photography, the Victoria & Albert Museum, the Guggenheim Abu Dhabi, the Smithsonian Museum of Natural History, the Fine Art Group, the UK National Archives, Cartier, and numerous other galleries, auction houses, museums, luxury brands, art fairs, advisories, law firms and beyond."

The US Department of Education's College Navigator indicates that SIA's student population in the US is about 200. Tuition alone is $56,340 per year. The school's US faculty includes one full-time instructor and 35 part-timers. 87 percent of the students are female; 49 percent are Asian. The school only offers certificates and graduate degree programs. SIA's website does not appear to name any Board members.  

US Department of Education (IPEDS) data also suggest that SIA's expenses have surpassed revenues since 2016-17.  

(Source: US Department of Education)

The Higher Education Inquirer is in the process of gathering more information about the school's finances and whether students should be aware of the HCM status. Other schools on the list have recently closed or are in the process of closing, including Bay State College, King's College, and Union Institute.  

Related links: 

Ambow Education Facing Financial Collapse

A preliminary list of private colleges at risk

National American University Has No Cash

National American University Holdings (NAUH) of Rapid City, South Dakota has no cash.  The company owns National American University and its subsidiary, Henley-Putnam School of Strategic Security.

According to the company's most recent financial statements:

"As of August 31, 2023, the Company had approximately $0.0 million of unrestricted cash and cash equivalents, a working capital deficit of approximately $4.8 million, and a deficit in stockholders’ equity of approximately $1.8 million." 

NAUH has avoided creditors for years and been able to get US government funds, including more than $2M in COVID relief funds in 2020 and 2021.   

National American University's enrollment in 2015 was 9,519 students. Since then, NAU has closed more than 30 campuses in nine states: Colorado (3), Indiana, Kansas (4), Minnesota (5), Missouri (3), New Mexico (2), Oklahoma, South Carolina, South Dakota (3), and Texas (7), and has become an exclusively online school (apart from a small site at Ellsworth Air Force Base).

According to the US Department of Education's most recently published numbers, National American University has approximately 1100 students. The school has no full-time instructors. There is no indication that those students are prepared for the school to close. 

Related link:

National American University and the Subprime College Crash (2018)

The Collapse of Ambow Education and NewSchool of Architecture and Design

Ambow Education, the principal owner of the New School of Architecture and Design (NSAD) in San Diego has been cited by the New York Stock Exchange as a Non Compliant Issuer and risks imminent delisting from the exchange. The warning was delivered on September 21, but the company has yet to notify its shareholders.

The Higher Education Inquirer reported on Ambow's financial problems in May 2022.  

In January 2023, Ambow Education's other US school, Bay State College, lost its regional accreditation. After losing its appeal with its accreditor NECHE, Bay State College closed its doors in August. NewSchool of Architcture and Design remains open with less than 300 students. NSAD is currently on Heightened Cash Monitoring by the US Department of Education due to ongoing financial problems.