Heightened cash monitoring is a regulatory process used by the United States Department of Education to monitor certain universities that receive student financial aid disbursements from the government and may be in financial difficulty.
Levels There are three levels of monitoring that can apply to an institution. Level 1 (HCM1) is the least severe.
Level 1 Institutions assigned to level one, known as "HCM1", have to provide funds to students out of their own reserves, and then draw the funds afterward from the Federal Student Aid (FSA) program.
Institutions that were on Heightened Cash Monitoring Level 1 that subsequently closed included:
Art Institute of Las Vegas (2019) The Art Institutes (2023)
Level 2 HCM2 institutions provide funds to students out of their own reserves, and then seek reimbursement afterward from the FSA program of the Department of Education. Institutions that were on Heightened Cash Monitoring Level 2 and subsequently closed included:
Bristol University, placed on HCM2 in 2015; closed 2017 Eastern Gateway Community College, placed on HCM2 in 2022; closed in 2024 Florida Career College, placed on HCM2 in 2022; closed in 2024 Vatterott College, closed in 2018 Independence University, placed on HCM2 in 2021; closed that same year ITT Technical Institute, closed in 2016https://www.kvue.com/article/news/local/itt-tech-closing-all-schools-nationwide/269-314446375 Northwestern College, placed on HCM2 in 2022; closed in 2024 St. Catharine College, closed in 2016 Union Institute and University, placed on HCM2 in 2023; closed 2024
Notable institutions on Heightened Cash Monitoring 2 by the United States Department of Education as of June 2026 include:
American University of Antigua in Antigua and Barbuda California College of Music in Pasadena, California Centro de Enseñanza Técnica y Superior in Mexicali, Mexico Hiram College in Hiram, Ohio Hobe Sound Bible College in Hobe Sound, Florida Oakland City University in Oakland City, Indiana Randall University in Moore, Oklahoma Shorter College in North Little Rock, Arkansas Sotheby's Institute of Art in London, England and New York City, New York St. Augustine's University in Raleigh, North Carolina University of Buckingham in Buckingham, England Urshan University in Wentzville, Missouri Yeshiva of Nitra in Brooklyn, Chester and Mount Kisco, New York
Notable institutions formerly on Heightened Cash Monitoring 2 include: Paul Smith's College in Paul Smiths, New York
Reimbursement level A stronger version of level two, in which the FSA reviews every payment reimbursement request by the educational institution before acting on it.
History
2010s
The Department of Education first began releasing Heightened Cash Monitoring records in 2015 following media investigations by Inside Higher Ed. These reports suggested that the government was intentionally withholding the identities of institutions whose financial or administrative instability had already triggered restricted access to federal aid.
In that earliest March 2015 list, of 560 institutions subject to heightened cash monitoring, 487 were at level HCM1, the lower level of monitoring, and 69 were on the stricter level 2 (HCM2).
2020s
Of the colleges that utilize federal funding, nearly 10% fell under level one status (HCM1) in 2023. Specifically, the Department of Education designated 493 institutions as HCM1 and another 78 as HCM2, comprising about 10% of participating institutions at the time.
Harvard University
While heightened cash monitoring designations are invariably for institutions with serious financial problems requiring closer attention by the Department of Education, Harvard University was placed on Heightened Cash Monitoring level 1 in September 2025. Jon Fansmith, of the American Council on Education described the move by the United States Department of Education as "harassment."
Harvard has a $53 billion endowment. Prior to assigning it to HCM1 status, the administration had restricted research funding and pressured Harvard to pay a $500 million fine but it did not submit to these and other demands.
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