Trump Administration Places Harvard University Under Financial Oversight

The U.S. Department of Education announced on Friday that Harvard University has been placed on heightened cash monitoring due to "growing concerns" regarding its financial position. The Department's Office of Federal Student Aid (FSA) will oversee the university's spending and require Harvard to use its own funds to disburse federal student aid before drawing down funds from the Department.

"Students will continue to have access to federal funding, but Harvard will be required to cover the initial disbursements as a guardrail to ensure Harvard is spending taxpayer funds responsibly," the Department stated.

Additionally, the FSA has mandated that Harvard post an irrevocable letter of credit for $36 million or provide other acceptable financial protection to guarantee the university can meet its financial obligations.

This action follows three triggering events identified by the Department: a determination that Harvard violated Title VI of the Civil Rights Act, which prohibits discrimination based on race or origin; noncompliance with requests from the Office of Civil Rights; and concerns over the university's plans to issue over $1 billion in bonds to fund its operations.

"Today’s actions follow Harvard’s own admission that there are material concerns about its financial health," said U.S. Secretary of Education Linda McMahon. "As a result, Harvard must now seek reimbursement after distributing federal student aid and post financial protection so that the Department can ensure taxpayer funds are not at risk. While Harvard remains eligible to participate in the federal student aid program for now, these actions are necessary to protect taxpayers."

On the same day, the Department's Office for Civil Rights issued a "denial of access letter" to Harvard for its continued refusal to provide documents and information as part of a compliance review to determine if the university is illegally considering race in its undergraduate admissions process.

"The highest court in our nation ruled conclusively that Harvard was illegally using extreme racial preferencing in their admissions processes," McMahon stated. "The Department has both the right and responsibility to verify Harvard’s compliance with federal civil rights laws. For all their claims, they refuse to provide evidence necessary for the Department to make that determination. What are they hiding?"

These developments are part of ongoing tensions between the Trump administration and Harvard University. Previously, the administration froze $2 billion in grants to the university after accusing it of antisemitism, a claim the university has disputed.

Earlier this month, a federal judge in Boston ordered the administration to unfreeze nearly $2.2 billion in federal grants to Harvard. The administration has indicated plans to appeal the decision.

Harvard has not immediately responded to requests for comment.