In December 2019, the University of Phoenix agreed to a settlement with the Federal Trade Commission for deceiving students with lofty claims of a promising future. The FTC announced a settlement worth $191 million. As part of the settlement, the University of Phoenix and its parent company agreed to return $50 million in cash to former students and cancel $141 million in student debt owed directly to the school. The settlement, however, doesn’t address private student loans taken out or other expenses.
Military students who were enrolled in the University of Phoenix in Texas and California between 2012-2016 may be eligible to receive refunds on school-related expenses.
What did the University of Phoenix do wrong?
In its FTC settlement, The University of Phoenix did not admit to any wrongdoing. However, a quick examination of its advertisements reveals a false promise of higher-paying jobs upon completion of a degree. In fact, after completing their degree, many students can’t secure a job in their field of study. Further, they are saddled with a tremendous amount of debts accrued throughout their studies.
In addition to its false promise, the for-profit college gave the false impression that it partnered with major companies to ensure student employment. The company’s Let’s Get to Work campaign featured logos of high-profile employers such as:
This false advertising may have led students to enroll in the school under the impression that they too would be employed at a Fortune 500 company.
The University of Phoenix had a “sophisticated recruitment strategy” of military service members. According to internal documents, the company’s marketing goal was to penetrate the military market as completely as possible. As part of its recruiting efforts, the University of Phoenix sidestepped federal law that forbids for-profit colleges from gaining favorable access to Military Service Members. The rule was put in place in 2012 as a way to ensure that the GI Bill was not taken advantage of by for-profit colleges.
The University of Phoenix used loopholes to gain favorable access to military students. For example, the for-profit college paid $25,000 to sponsor a concert for Fort Campbell soldiers and their families. In fact, over the past five years, the University of Phoenix has spent more than $1 million in sponsoring events at the largest military bases in the country. Additionally, the company engaged in military recruitment by using the following methods:
- Cultivated relationships/partnerships with veterans organizations.
- Use of military insignias in school marketing without required permissions.
- Sponsored hundreds of events on military bases including concerts, Super Bowl parties and father-daughter dances.
Will I receive a payment from the University of Phoenix’s settlement with the FTC?
If you were a student at the University of Phoenix during the designated years, it’s likely that you will receive a check from the FTC settlement. However, how much you receive is not yet clear. What is clear, is that you likely will not recover the full amount you paid to the University of Phoenix from that settlement.
We’ve got your six.
VLAP is here to assist Veterans and Family Members dealing with any of these legal concerns. If you were a student at the University of Phoenix and are curious about the lawsuit, contact us to be connected to one of our trusted legal advisors.
Litigation efforts are currently only being addressed in California and Texas. Additional efforts in other jurisdictions are pending based on statutes and case law.