The U.S. Education Department has imposed a historic fine of $37.7 million on Grand Canyon University, citing misleading conduct towards over 7,500 students and violations of federal law. The department’s chief operating officer for Federal Student Aid, Richard Cordray, underscored the institution’s actions in harming students, breaking trust, and escalating student debt.

The issues date back to 2017 when Grand Canyon University, one of the largest private Christian institutions with approximately 120,000 students in-person and online, provided misleading information to prospective and current doctoral students about program costs. They told students that their doctoral degree program would cost between $40,000 and $49,000, based on completing the program within 60 credit hours. However, this information failed to account for the additional courses required to finish the dissertation program. On average, students needed nearly 10 continuation courses to earn their degree, resulting in additional costs of up to $12,000 for some.

The department’s investigation revealed that Grand Canyon University was aware of the discrepancies in the information they provided but failed to rectify them. The fine of $37.7 million, a record amount for such a case, was imposed due to 7,547 violations, each corresponding to a misled student who enrolled in doctoral dissertation programs between November 1, 2018, and October 19, 2023.

While the department could have imposed a maximum fine of $509.7 million, it took into consideration that these violations involved a small portion of the university’s programs, affecting fewer than 5% of students receiving federal financial aid. Furthermore, the university’s cooperation with the investigation and its efforts to update disclosures led to the reduced fine.

This fine serves as a message about holding institutions accountable for misconduct and deceptive practices. Grand Canyon University has denied the department’s findings, emphasizing that continuation courses are standard in higher education doctoral programs.

The university, located in Phoenix, has previously faced challenges related to its for-profit status and separation from its parent company, Grand Canyon Education. It’s currently locked in a lawsuit with the Education Department over its bid to become a nonprofit. The record-setting fine will be imposed on November 20 unless the university requests a hearing or submits a written response.