At the center of the scandals involving for-profit colleges has been dishonesty about the value of their education. The schools under the Corinthian Colleges umbrella, which were all closed abruptly in 2015, lost their accreditation over their written promises that graduates would secure jobs with the military and other high-profile employers immediately. ITT Technical Institute was sued for similar reasons before its closure in 2016.
University of Phoenix, perhaps one of the best-known remote education for-profit colleges, is currently tarred with the same brush. On December 10, University of Phoenix agreed on a substantial settlement with the Federal Trade Commission over accusations of recruitment fraud.
In 2012, University of Phoenix ran an advertising campaign on radio, internet, and television specifically implying that it had partnerships with major corporations, like Microsoft, Twitter, and Adobe, that would lead to jobs for graduates.
In a television ad, a narrator notes that the University of Phoenix works with companies “to create options for you,” over logos of Microsoft, the American Red Cross, and more. A radio ad names Adobe and AT&T as “helping us shape our curriculum to make sure today’s classes help you to pursue tomorrow’s jobs.”
When investigators looked into the truth of these claims, they found no such partnerships at all. The closest relationship any of these companies ever had with the university was a program discounting tuition for people already employed by them.
“Students making important decisions about their education need the facts, not fantasy job opportunities that do not exist,” Andrew Smith, director of the Federal Trade Commission’s Bureau of Consumer Protection, told NBC News.
The accusations, if true, would mean that many students enrolled in University of Phoenix and paid their tuition under false hope, deliberately misled by the school.
While the school continues to deny any deliberate wrongdoing, in a settlement it has agreed to cancel all remaining student debt owed to the university for any student enrolled during or immediately following the campaign, which means from 2012 through 2016. It will also pay $50 million in cash as repayment to those who have already paid their debts. The University of Phoenix has also agreed to continued FTC monitoring of its future advertising efforts.
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