AITA for refusing to pay my daughter’s sorority dues?

So my daughter is in a sorority, which I 100% supported. My wife and I paid for her dues and supported her when when she asked if we would be okay with it. Unfortunately, last week I found out something very upsetting. My daughter was trying to enroll for classes but had holds on her account with prevented her from doing so.

She called the university to get everything sorted out. When I asked her what happened she told me her sorority was in hot water for underaged drinking and they all had to take an online course about alcohol and student conduct on campus. When I asked why she didn’t tell me this before she told me she was too embarrassed to. I don’t know why (call it intuition I guess) but I didn’t believe her. I decided to do some research on my own and stumbled across an article written by her schools newspaper about a halloween party thrown by her sorority and their brother frat.

Since this isn’t a debate sub, I don’t want to say exact details but I will say the theming of the party was very offensive. In the article was a screenshot of an instagram post from the party and there I saw it, a picture of my daughter in a racially insensitive costume. When I confronted her about this she immediately became frustrated and told me it’s not that big of a deal and she didn’t tell me because she knew I’d blow it out of proportion.

I decided to leave the room and go talk to my wife about the situation before I said something I’d regret and my wife and I both decided that we will no longer pay for her sorority dues. Both my wife and I support racial equality and have always taught those morals to our daughter, to see her disregard them was very upsetting and we decided that we would not support our daughter in an environment which undermined those views. When we told her this she completely blew up, saying that we promised to pay for it etc. etc. She also called us financially abusive as we both know that she would not be able to pay for the dues herself and finding a job is nearly impossible.

She has one last payment due this semester and she doesn’t have the money to pay for it. She talked to her sisters and they told her that they would be willing to give her an extension until the fall semester, but she is unsure if she will have the money then. Our daughter is very upset with us and thinks we’re overreacting. She’s been crying for a week and I have to wonder, AITA for refusing to pay? Was our punishment too harsh?

EDIT1: Since everyone’s asking I guess I should state what the costume/theming was. The theme was “Pimps and hoes” (and those parties never go well.) And my daughter got box braids as well as an extremely deep tan, she’s extremely pale and while she does use spray tans I’ve never seen her this dark before. Think going from this to this. To me it was obviously emulating and making fun of black people which is extremely gross. I raised her better than that and I don’t know why she thought it would be okay.

EDIT2: I figured I would clear up some other misconceptions. First, my daughter didn’t have to take an alcohol class, she made that up. In reality she had to take a class pertaining to racial sensitivity/diversity and take a quiz afterwards. This course took her an hour tops. There was also a community service aspect but that was cancelled because school let out early. She was not the only student in an offensive costume, in the photo that was posted in the newspaper there were two other students in blackface as well. I do have to thank you all for your support and advice.

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