The offices at 777 Valencia Street and companion buildings across the street were home to its humanities-based programs, including the Humanities BA, Mathematics, Poetics, Writing and Consciousness, Media Studies, Graduate Psychology, Experimental Performance Institute, Women’s Spirituality MA, Humanities and Leadership, Activism and Social Change, the Teacher Credential Program, as well as a broadcast studio and administration offices.

[5] The same year, WASC reported that the school did not have stable revenue, adequate financial controls, and suffered from "extremely serious management problems".

[6] Throughout the college's history, groups of faculty, students, alumni and staff mounted challenges to the school's governance system, but these efforts failed to achieve lasting change.

[citation needed] Numerous campaigns by faculty groups seeking reform, often regarding specific academic programs, had no more than limited, short-term influence.

[citation needed] In June 2007, the Western Association of Schools and Colleges (WASC) after years of accreditation, approvals and recertifications, launched an investigation into New College which obliquely alleged that the school suffered from poor record keeping, flawed financial controls, and inadequate curricula and that President Hamilton, was corrupt and engaged in a number of conflicts of interest.

[1][5] The report cited a number of incidents, such as one where a scammer posing as an international student requested class credits in exchange for a large financial gift which never materialized, and another where the school's administration couldn't explain course requirements and specific content of its "Pilot Hybrid Leadership in Urban Transformed Environments" program.

[citation needed] After Hamilton's resignation, Luis Molina, an attorney who served on the school's board of trustees was inaugurated as the college's interim president.

[5][7] Francisco Leite, a former university administrator from Brazil who Martin Hamilton met while contracting an exchange program with UNAES, became Chief Financial Officer.

[5][7] Molina also promised to reform the school's governance, as students and faculty complained that all real administrative power lay in the hands of Hamilton and his confidants.

[7] Molina's interim administration hired an educational consultant to help bring the college into compliance with accreditation standards of WASC, an effort which drew praise from faculty and the association.

[citation needed] The financial aid staff hired by Molina and Leite were unable to fix the files to conform to DOE standards, and DOE investigation also revealed that the school failed to keep required records and could not account for large amounts of federal financial aid funds.

[citation needed] A meeting in November 2007 found that the school was losing $80,000 each month, and was contemplating pay cuts for faculty, layoffs, and even bankruptcy protection.

[citation needed] In July 2008, the college acknowledged its debts in agreements it signed to settle wage claim disputes filed with the Department of Industrial Relations.