This week, 40 prestigious U.S. colleges were sued for allegedly participating in a price-fixing scheme that has made college more expensive for students with divorced or separated parents. The lawsuit, filed by a Cornell alum and a Boston University student, focuses on the CSS Profile, a form used by some schools to assess a student’s financial need. The complaint claims that since 2006, the College Board, which manages the CSS Profile, has required both custodial and noncustodial parents to report their financial information. This practice inflates the estimate of what families can afford, often denying students from divorced homes institutional scholarships. The lawsuit argues that this has hurt an estimated 20,000 students over 18 years, leading to higher out-of-pocket costs for many families.
Attorneys representing the plaintiffs allege that the College Board and the colleges worked together to push this policy, which disproportionately impacts students from split households. For example, one plaintiff, Maxwell Hansen, noted that his father was required to fill out the form even though he would not contribute to his education, affecting the aid he received at both American University and Boston University. Another plaintiff, Eileen Chang, was denied financial aid adjustments by Cornell despite her noncustodial parent’s inability to contribute due to disability. Her custodial parent had to take out loans to cover the shortfall.
Many of the colleges named in the lawsuit are among the nation's most elite, including Ivy League schools and top research institutions like MIT, New York University, and the University of Southern California. While NYU has already stated its intention to defend itself, other schools like Harvard, Georgetown, and Duke have declined to comment on the ongoing litigation.
The College Board remains confident in its policies, stating that less than half of the 270 schools that use the CSS Profile require information from noncustodial parents. They argue that the form provides a more accurate financial picture than the FAFSA, which only accounts for the custodial parent’s finances. However, the lawsuit adds to a growing concern among students that colleges might be manipulating financial aid practices for their benefit. In a related 2022 case, 16 elite colleges faced similar accusations, with 10 schools, including Columbia and Yale, agreeing to settle for a total of $284 million.
This lawsuit could have wide-ranging implications for how colleges calculate financial aid, especially for students from divorced or separated families.
