The For-Profit School Lured Students by Advertising Employer Partnerships That Did Not Exist

The For-Profit School Lured Students by Advertising Employer Partnerships That Did Not Exist

The University of Phoenix, one of many nation’s largest for-profit college chains, agreed to a $191 million settlement on Tuesday with the Federal Trade Commission, which stated the varsity had lured in students with fraudulent claims about partnerships with main firms that one of many chain’s personal executives had described as “smoke and mirrors.”

The University of Phoenix didn’t admit wrongdoing beneath the settlement. It’ll pay a $50 million penalty to the F.T.C. and cancel $141 million in debts, largely for unpaid tuition and costs, owed by former students who first registered throughout that four-year interval. Tens of thousands of scholars shall be covered, most probably for comparatively modest sums.

The F.T.C.’s settlement, after an investigation that began more than four years ago, is the company’s largest with a for-profit school. It previously settled complaints towards two different chains, the DeVry Education Group and the Career Education Corporation, over what it stated have been false claims.

At the very least, 3,000 borrower-defense applications have already been filed by former students at the University of Phoenix, in line with the Student Borrower Protection Center, a nonprofit advocacy group.

An Education Department spokesman didn’t have an immediate comment on how the F.T.C.’s motion would have an effect on borrower-defense claims filed by the school’s students.

For-profit colleges have regularly been criticized for leaving students mired in debt for degrees that hardly ever led to nicely-paying jobs. A federal and state crackdown in the course of the decade tightened laws and pushed some of the largest chains into bankruptcy.

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