We had about half of the fraternities at my school be unrecognized. Basically, they didn't participate in anything campus sponsored such as homecoming, greek week, planned rush, IFC/NPC/IGC decisions. Other than that, they thrived! They had their own rush events, that they publicized on campus, even though they weren't recognized. They got a lot of new members, and they did everything as a normal fraternity would. Now mind you, most were locals, but a couple nationals got thrown off campus, but their national didn't take their charters and just put them on probation.
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