Treatment by Department of Veterans Affairs of educational institutions that violate certain prohibitions on advertising, sales, and enrollment practices

(a)

Restoration of entitlement

Section 3696 of title 38, United States Code, is amended—(1)by redesignating subsections (i) through (l) as subsections (j) through (m), respectively; and(2)by inserting after subsection (h) the following new subsection (i):

(i)

Restoration of entitlement

Upon a final determination by the Under Secretary for Benefits under subsection (g), including the results of any appeal under subsection (i), that an educational institution or the owner of an educational institution violated subsection (a), (c), or (d), the Secretary may determine that any payment of educational assistance to an individual who used entitlement to educational assistance under chapter 30, 31, 32, 33, or 35 of this title, or chapter 1606 or 1607 of title 10, to pursue a course or program of education at such educational institution during the time period when the violation occurred, and who was unable to continue such course or program at such educational institution by reason of such violation, is not—(1)charged against any entitlement to educational assistance of the individual; or(2)counted against the aggregate period for which section 3695 of this title limits the receipt of educational assistance by such individual.

(b)

Repayment of funds

(1)

In general

Subsection (h) of such section is amended—(A)in paragraph (4), by striking subsection (i) and inserting subsection (j); and (B)by adding at the end the following new paragraph:

(5)(A)In addition to any other enforcement action taken under this subsection, upon a final determination by the Under Secretary for Benefits under subsection (g) that an educational institution or the owner of an educational institution violated subsection (a), (c), or (d), the Secretary shall require the educational institution to repay to the Secretary all amounts of educational assistance under chapter 30, 31, 32, 33, or 35 of this title, or chapter 1606 or 1607 of title 10, paid to the educational institution by or on behalf of an individual who pursued a course or program of education at the educational institution during the time period when the violation occurred.(B)As a condition of the approval of a course or program of education under this chapter, the educational institution offering the course or program shall agree that if Under Secretary of Benefits makes a final determination under subsection (g) that the educational institution or the owner of the educational institution violated subsection (a), (c), or (d), the educational institution shall make the repayment required under subparagraph (A).(C)The Under Secretary shall establish a process for making a determination regarding the amount an educational institution or an owner of an educational institution is required to repay under subparagraph (A) in the case of a violation of subsection (a), (c), or (d). Such process shall include—(i)clearly defined factors to be used to determine the amount attributable to the violation, including the degree to which individuals enrolled in a program of education offered by the educational institution using entitlement to educational assistance under chapter 30, 31, 32, 33, or 35 of this title or chapter 1606 or 1607 of title 10 suffered a loss due to the violation;(ii)a requirement that the Under Secretary provide notice to the educational institution or the owner of the educational institution that the Under Secretary is in the process of making such a determination with respect to the educational institution or owner; and(iii)a procedure under which the educational institution or owner may provide such information to the Under Secretary as the educational institution or owner determines appropriate within a specified period of time outlined by the Secretary for purposes of informing such determination.(D)A determination made pursuant to subparagraph (C) shall be—(i)made by the Under Secretary and may not be delegated; and(ii)subject to review under section 7104(a) of this title.

(2)

Disapproval

Section 3679 of title 38, United States Code, is amended by adding at the end the following new subsection:

(g)Notwithstanding any other provision of this chapter, in the case of an educational institution that the Secretary determines is required to repay to the Secretary an amount under section 3696(h)(5) of this title and does not repay such amount, the Secretary shall disapprove a course or program of education offered by the educational institution until the educational institution repays to the Secretary such amount.

(3)

Reinstatement

Paragraph (2) of subsection (k) of section 3696, as redesignated by subsection (a)(1), is amended—(A)in subparagraph (E)—(i)by striking that; and (ii)by striking and at the end;(B)by redesignating subparagraph (F) as subparagraph (G); and(C)by inserting after subparagraph (E) the following new subparagraph (F):

(F)the educational institution repays any amount required to be repaid under subsection (h)(5); and

(c)

Applicability

The amendments made by this section shall apply with respect to a violation that occurs on or after the date that is 180 days after the date of the enactment of this Act.