FTC targets false claims by for-profit colleges

RANDY HUTCHINSON
·3 min read

The FTC sent Notices of Penalty Offenses to the 70 largest for-profit colleges and vocational schools in October. The notices didn’t cite any wrongdoing by any of the schools, but did alert them to the kinds of deceptive practices that have been the subject of earlier enforcement actions.

The FTC says fraud in this sector persists and it’s fair to say the agency wouldn’t go to the trouble of sending so many notices if it didn’t have reason to suspect there were problems at some schools. Receiving the notice means a school will have “actual knowledge” about the deceptive tactics and, therefore, little or no defense if the FTC later sues it.

The notices advised the schools that it is illegal to directly or by implication misrepresent:

  • the demand for people who have graduated from, or completed courses at, a specific institution;

  • graduates’ employment prospects, the ease with which they’ll be able to get a job, or the employment opportunities in any field in which a course of instruction is offered;

  • the types of jobs available to grads or for which they would be qualified;

  • the number or percentage of people attending any course or completing any program or degree who have obtained employment, or the field or nature of that employment;

  • how much grads will or may earn;

  • the qualifications necessary to get jobs in the fields for which an institution offers training, including whether experience or additional education is required or advantageous; and

  • the institution’s capabilities for helping students find employment or the assistance actually given to grads, including the existence of job placement services.

In 2019, the University of Phoenix paid $191 million to settle FTC charges that it falsely touted job opportunities for its students through its relationships with AT&T, Microsoft, Twitter and other companies. DeVry University paid $100 million in 2016 to settle charges that it misrepresented the employment and salary prospects of its students.

The FTC says servicemembers and veterans are particular targets of deceptive marketing tactics by schools because of the education benefits they receive. In 2019, it settled charges against Career Education Corporation for using marketers who allegedly falsely claimed affiliation with the U.S. military to recruit graduates.

The FTC and BBB offer these tips when thinking about attending a for-profit school:

  • Remember that a school is not an employment agency. It can’t guarantee you a job.

  • Check out the school’s record with the BBB and your state Attorney General.

  • Understand all the costs, including for tuition, fees, lab expenses and materials.

  • Resist high pressure to enroll.

  • Ask what private or government agencies accredit or license the school and verify they’re legitimate. If you plan to go on to a four-year or other school, ask if it accepts credits from the school you’re considering. If not, that’s a sign it may not be well-regarded.

  • Check with professionals in the field you want to work in to see if the school is respected.

Ask about the success rate of students – what percentage complete the program; how many find jobs in their chosen fields; what the average starting salary is; and what percent are delinquent in paying back student loans. But as the FTC’s concerns indicate, you should take the answers with a grain of salt.

Randy Hutchinson is the president of the Better Business Bureau of the Mid-South. Reach the BBB at 800-222-8754.

This article originally appeared on Jackson Sun: FTC targets false claims by for-profit colleges