N.Y. Education Law § 5008: Trust accounts

§ 5008. Trust accounts. 1. If the commissioner determines that a

school has demonstrated a pattern or practice of failing to make tuition

refunds in a timely manner consistent with this article and/or the

school's financial condition may result in the interruption or cessation

of instruction or jeopardize student tuition funds, the commissioner

shall require a school to establish a trust account in a form or manner

which the commissioner shall determine to be appropriate. The assets or

funds contained in the trust account shall be maintained for the sole

and exclusive benefit of the students.

2. In making this determination, the commissioner shall consider the

following factors: the number of refunds not paid by the school in a

timely manner; the number of claims made to, or paid by, the tuition

reimbursement account; a pattern of misconduct which substantially

affects the financial interests of students or the state, potential

liability to the tuition reimbursement account, current assets as

opposed to current liabilities, and such other measures as may be

appropriate.