Regulatory case report for Raindance Educational Services Limited

This case report confirms that the Office for Students (‘OfS’) has found that Raindance Educational Services Limited (‘the provider’) has breached ongoing condition of registration F3 and that the OfS has decided to impose a monetary penalty on the provider. This report summarises the key aspects of this case.

The Higher Education and Research Act 2017 (‘HERA’) gives the OfS enforcement powers to use where the OfS determines that there is, or has been, a breach of one or more conditions of registration. These powers include imposing a monetary penalty – a fine under section 15 of HERA. Regulations made by the Secretary of State set out the factors to which we must have regard when deciding whether to impose a monetary penalty and its amount. These regulations also set out the maximum penalty we can impose for each breach, which is the higher of two per cent of a provider’s qualifying income or £500,000. The OfS has published guidance about our approach to the calculation of a monetary penalty in Regulatory advice 19.

On 20 March 2023, the OfS made a final decision that there had been a breach of ongoing condition F3 by the provider because it failed to meet the deadline of 8 June 2021 for submitting its signed audited financial statements for the year ending 31 October 2020 by just under 10 months, submitting its signed audited financial statements on 5 April 2022.

Ongoing condition F3 allows the OfS to compel the production of information on specific occasions and on an enduring basis. It requires providers registered with the OfS to ‘Provide the OfS, or a person nominated by the OfS, with such information as the OfS specifies at the time and in the manner and form specified’. We specify the information to be provided in an ‘F3 Notice’ issued to providers. Ongoing condition F3 sets an absolute requirement for compliance – in other words, providers must meet the deadlines set out in an F3 Notice and it is not enough simply to attempt to do so or take reasonable steps to do so.

This regulatory case concerns a requirement to provide the OfS with signed audited financial statements as part of its Annual Financial Return (AFR) 2020. This information assists the OfS with assessing a provider’s financial viability and sustainability. Condition F3 is also often used by the OfS for other important purposes, for example to investigate or monitor a provider’s compliance with other conditions of registration, such as quality, student protection and management and governance.

On 20 March 2023 the OfS also made a final decision to impose a monetary penalty on the provider to address the regulatory harm caused by this breach of condition F3 which arose as a result of its failure to provide audited financial statements by the applicable deadline.

We have imposed a penalty of £1,000. In this case, the final penalty amount imposed was significantly reduced to reflect our judgement that a higher penalty might have a disproportionately negative impact on students, in light of the resources reasonably available to the provider.