Nearly $ 50 million is being sent to alumni of the University of Phoenix following an agreement on charges that the school was involved in misleading advertising, the Federal Trade Commission announced on Wednesday.
The payment is part of a record $ 191 million deal reached in late 2019, due to accusations that the school has run ads falsely claiming to have relationships with companies like AT&T, Yahoo !, Microsoft and Twitter, the FTC said.
The ads claimed that the University of Phoenix could leverage its relationships with these large corporations to create job opportunities, shaping the curriculum so that students were better positioned for such jobs. But the school did not have that kind of relationship, the FTC said.
“This is the largest settlement the Commission has reached in a case against a for-profit school,” said Andrew Smith, Director of the FTC’s Office of Consumer Protection. “Students who make important decisions about their education need facts, not fanciful job opportunities that do not exist. “
An advertisement from the University of Phoenix showed a woman trying to find a parking space in a crowded parking lot.
“Like many things, trying to find a better job can be frustrating. So, at the University of Phoenix, we are working with a growing list of almost 2,000 corporate partners – companies like Microsoft, the American Red Cross and Adobe to create options for you,” he said. a narration.
Cars in various spaces go up to show the company logos, along with those of Avis, Twitter, MGM Resorts, AT&T and Microsoft.
“In addition, we are using what we have learned from these partners to shape our resume so that when you find the job you want, it will fit perfectly,” the announcement continued.
The FTC claimed that UOP and its parent company, Apollo Education Group, were specifically targeting potential Hispanic and military students. The Apollo Education Group has been the biggest beneficiary of GI Bill Post-9/11 benefits, which pays tuition and fees on behalf of veterans or their dependents, according to the FTC.
In a statement to NBC News, a spokesman for the University of Phoenix said the FTC’s allegations concerned “a campaign that ended in 2014 that has not been tested through litigation and does not constitute factual findings by the FTC or any court. “
“The University has not admitted any wrongdoing and continues to believe that it has acted properly,” the statement said. “This agreement has enabled us to continue our focus on our primary mission of improving the lives of our students through higher education relevant to their careers and avoiding any additional distractions in serving students that could have resulted from prolonged litigation.”
In addition to the nearly $ 50 million in direct payments to more than 147,000 students, the $ 191 million agreement includes $ 141 million to cancel unpaid balances owed directly to the school by qualified students.
For the $ 50 million, the FTC is sending 146,804 checks and issuing 677 PayPal payments to students who: enrolled at UOP between October 15, 2012 and December 31, 2016; paid more than $ 5,000 in cash, grants, federal and private student loans or military benefits; did not obtain debt cancellation as part of the settlement; and did not choose not to allow UOP to provide the student’s contact information to the FTC.
