News & Insight


The U.S. Department of Education has launched new investigations at both Yale University and Harvard University relating to Section 117 of the Higher Education Act.  This law requires postsecondary institutions to report foreign gifts and contracts from the same foreign source that, alone or combined, have a value of $250,000 or more for a calendar year. We covered in a previous post the legal landscape of reporting donations and contracts from foreign sources.  

The two investigations add to the six pending investigations of Georgetown University, Texas A&M University, Cornell University, Rutgers University, University of Maryland, and Massachusetts Institute of Technology. In her statement accompanying the announcement of the new investigations, Secretary DeVos stated, “Unfortunately, the more we dig, the more we find that too many are underreporting or not reporting at all. We will continue to hold colleges and universities accountable and work with them to ensure their reporting is full, accurate, and transparent, as required by the law.”

The Department’s announcement of new investigations coincides with its recent withdrawal of a proposed information collection request of Section 117 foreign gift and contract disclosures. The Department plans on resubmitting to the Office of Management and Budget a new request for proposed information collection in the upcoming weeks, while separately pursuing proposed rulemaking to address the Department’s collection of “true copies” of contracts from covered institutions. We plan on monitoring the federal register for this proposed rule and informing interested clients who may wish to submit public comment on this development.

In light of the Department’s enforcement actions and focus on foreign gifts and contracts, institutions of higher education should review their obligations under Section 117, consider whether they have implemented appropriate measures for reporting foreign gifts and contracts, and assess whether additional oversight is needed in their reporting system. Colleges and universities should also note that pursuant to 20 U.S.C. § 1011f, knowing or willful failure to comply with Section 117 may result in monetary damages of up to the full cost of obtaining compliance and associated costs of investigation and enforcement. Moreover, the Secretary of Education can request that the Attorney General commence a civil action to compel compliance in court.

Should you require assistance in conducting an analysis of your institution’s foreign gifts and contracts reporting system, or if you have any questions regarding compliance with these federal requirements, please feel free to contact HMBR’s Higher Education Group at 312-946-1800.


  Feb 14, 2020  |  By    |   On Education