Savanna Hoffman
The University of Phoenix has been mired in lawsuits and investigations by the Federal Trade Commission (FTC) and the Department of Education (ED) for its marketing and recruitment practices. The FTC and ED alleged that the university used deceptive advertising to attract students, falsely claiming partnerships with prominent companies and implying that these relationships would help students secure jobs. As a result of these investigations, the University of Phoenix agreed to pay a settlement of $191 million in 2019, including $50 million in cash distributed to former students and a $141 million cancellation in student debt. The ED has also announced that it will approve federal student loan forgiveness for eligible students who attended the university between September 21, 2012, and December 31, 2014, and were deceived by the school's job placement claims. This loan forgiveness could provide much-needed relief to students burdened by debt and struggling to repay their loans.
| Characteristics | Values |
|---|---|
| Date of Announcement | September 20, 2023 |
| Eligible Students | University of Phoenix students who attended between September 21, 2012, and December 31, 2014 |
| Eligibility Criteria | Deceived by the school's job placement claims and submitted a valid application for borrower defense |
| Total Loan Forgiveness | Up to $37 million |
| Number of Eligible Students | Approximately 1,200 |
| Responsible Authority | U.S. Department of Education |
| Basis for Decision | FTC's 2019 court action against the University of Phoenix for deceptive advertising practices |
| University Response | Denial of wrongdoing; commitment to challenge allegations |
| University Ownership | Apollo Global Management and Vistria Group |
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What You'll Learn
- University of Phoenix students may be eligible for federal loan forgiveness
- The University of Phoenix used deceptive advertising to attract students
- The University of Phoenix falsely claimed to work with top companies for job opportunities
- The University of Phoenix settlement included a $141 million student debt cancellation
- The University of Phoenix bled enrollment due to lawsuits and investigations
University of Phoenix students may be eligible for federal loan forgiveness
The University of Phoenix has been mired in lawsuits and government investigations, resulting in declining enrolment numbers. The university has been accused of deceptive advertising and misleading students with false claims about its partnerships with renowned companies. The Federal Trade Commission (FTC) spent years investigating the university, and in 2019, the University of Phoenix agreed to pay a settlement of $191 million related to charges of deceptive advertising.
As a result of these investigations, the U.S. Department of Education has announced that it will approve federal student loan forgiveness for eligible University of Phoenix students. The loan forgiveness applies to those who attended the university between September 21, 2012, and December 31, 2014, and were deceived by the school's claims. The total loan discharge amount is $37 million, and it is estimated that 1,200 students are eligible for relief.
To be eligible for loan forgiveness, students must have submitted a valid application for relief through the ED's Borrower Defense program. This program allows students to seek relief if they have been misled or defrauded by their college. The Department of Education is continuing to process new and existing applications, and all borrowers with approved claims will receive full loan forgiveness.
If you believe you may be eligible for loan forgiveness, you can check the status of your application on the borrower defense page under "Manage My Applications." Even if you have already received a payment from the University of Phoenix settlement fund, you can still apply for loan forgiveness through the borrower defense program. Additionally, filling out the borrower defense form and connecting with advocacy groups can help strengthen your case for loan forgiveness.
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The University of Phoenix used deceptive advertising to attract students
The University of Phoenix has been accused of using deceptive advertising to attract students. The Federal Trade Commission (FTC) charged the university with misleading advertising campaigns that gave potential students the false impression that the school had partnerships with major companies. These companies included AT&T, Microsoft, Yahoo!, Twitter, Adobe, and the American Red Cross. The University of Phoenix claimed that these partnerships would provide students with employment opportunities after graduation and that the curriculum was tailored to meet the job requirements of these companies.
In reality, these companies did not partner with the University of Phoenix to provide special job opportunities for its students or develop its curriculum. The FTC's complaint alleged that the University of Phoenix's advertising and marketing materials targeted active-duty servicemembers, veterans, military spouses, and Hispanic consumers. The university's “Let's Get to Work" campaign featured logos from high-profile employers, which may have led students to believe that the university had connections that would benefit their careers.
As a result of these deceptive practices, the University of Phoenix agreed to a $191 million settlement with the FTC in 2019. The settlement included $50 million in cash payments and the cancellation of approximately $141 million in debts owed directly to the school by students who were harmed by the deceptive advertisements. This settlement is the largest obtained by the FTC in a case against a for-profit school.
The University of Phoenix's deceptive advertising has had a significant impact on students, with many feeling misled and burdened by student loan debt. Some students have shared their experiences, stating that the university was not transparent about its practices and only cared about their money. The university's actions have led to increased scrutiny of for-profit colleges and universities, with many students seeking loan forgiveness and legal recourse.
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The University of Phoenix falsely claimed to work with top companies for job opportunities
The University of Phoenix has been accused of falsely claiming to work with top companies to provide job opportunities for its students. The Federal Trade Commission (FTC) charged the university with using deceptive advertising to attract students, misleading them about their post-graduation job prospects. The FTC's complaint alleged that the university claimed to have relationships with high-profile companies, including Microsoft, Twitter, Adobe, Yahoo!, AT&T, and the American Red Cross, among others. These companies were featured in the university's marketing campaign, with logos and voiceovers suggesting that the university worked with them to create job opportunities for its students.
The University of Phoenix agreed to pay a total of $191 million to settle these charges, with $50 million in fines directly to the FTC and $141 million towards forgiving student debt held by the school. The settlement applies to graduates who enrolled between October 1, 2012, and December 31, 2016, and were led to believe they would get a good job after graduating. The University of Phoenix's marketing campaign, "Let's Get to Work," prominently name-dropped these employers, giving the impression of partnerships and tailored education to make students attractive to these companies.
The FTC found that these claims were false and that the university could not guarantee job placement at these businesses nor claim that they had influenced the curriculum. The settlement has provided some relief to students harmed by the school's false claims, and the Department of Education has also announced federal student loan forgiveness for eligible University of Phoenix students who were deceived by the school's job placement claims. The University of Phoenix's case is an example of the increasing scrutiny that for-profit universities are facing due to their potentially misleading advertising tactics.
In addition to the FTC settlement, there are also individual lawsuits and investigations being pursued by graduates of the University of Phoenix. These graduates, particularly from Texas and California, were led to believe that they would be offered jobs by the companies the university claimed to partner with. However, they did not find employment in their chosen fields after graduating. These lawsuits aim to provide further compensation and hold the university accountable for its deceptive practices.
The University of Phoenix case highlights the importance of transparency and accuracy in higher education marketing and the potential consequences for institutions that engage in deceptive practices to attract students. It also underscores the impact that false claims can have on students' decisions and their future careers.
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The University of Phoenix settlement included a $141 million student debt cancellation
The University of Phoenix has agreed to cancel $141 million in student debt as part of a settlement with the Federal Trade Commission (FTC). The settlement, announced in December 2019, resolves allegations of deceptive advertisement practices used by the university to attract prospective students.
The FTC charged that the University of Phoenix falsely claimed partnerships with prominent companies such as Microsoft, Twitter, Adobe, Yahoo, AT&T, Hitachi, and Avis. The university suggested that these partnerships would provide job opportunities and tailored curriculum for its students. However, investigators found no such agreements in place.
As a result of the settlement, the University of Phoenix and its parent company, Apollo Education Group, agreed to pay $50 million in cash and cancel $141 million in student debt. This settlement money will be used to compensate consumers who were misled by the deceptive advertisements. Additionally, the university is barred from making further false claims about its relationships with companies or employers.
The settlement has been applauded by education advocacy groups, including Veterans Education Success, which works to protect military veterans from predatory colleges. The FTC's record-breaking settlement sends a strong message against deceptive practices in the for-profit education sector.
It is important to note that the student debt cancellation applies specifically to those who enrolled between October 1, 2012, and December 31, 2014, and were deceived by the school's claims. Eligible students will receive letters informing them that they no longer owe payments to the University of Phoenix. Additionally, the U.S. Department of Education has announced federal student loan forgiveness for affected students who submit valid applications for borrower defense.
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The University of Phoenix bled enrollment due to lawsuits and investigations
The University of Phoenix has been the subject of numerous lawsuits and investigations, which have had a significant impact on its enrollment numbers. In 2010, the university boasted a peak enrollment of nearly half a million students. However, between 2010 and 2016, enrollment plummeted by over 70% as the institution became mired in controversies, investigations, and legal troubles.
One of the major controversies surrounding the University of Phoenix involved deceptive advertising practices. The Federal Trade Commission (FTC) and the Education Department alleged that the university made false claims about its relationships with prominent companies, including those in the Fortune 500, such as Microsoft, Adobe, and AT&T. The University of Phoenix allegedly implied that these corporate connections could help graduates secure jobs. In 2019, the university settled FTC charges, agreeing to pay $191 million. Additionally, in 2023, the Biden administration canceled approximately $37 million in student loans for over 1,200 borrowers who attended the university between September 2012 and December 2014.
The University of Phoenix has also faced legal issues related to its recruitment practices. In 2015, the Department of Defense suspended the university's ability to recruit on U.S. military bases and receive federal funding for educating military personnel. This suspension was lifted in 2016 after protests from several senators. However, the Federal Trade Commission launched an investigation in the same year into the university's advertising campaign from 2012 to 2014. In 2019, the University of Phoenix agreed to pay a settlement of $191 million related to charges of misleading advertisements.
The University of Phoenix was also the subject of a class-action lawsuit filed by Apollo Education Group shareholders in 2016. The lawsuit alleged that the corporation withheld information, leading to significant stock price losses. Several allegations pertained to the university's recruitment of military personnel and veterans. Additionally, in 2019, a class-action lawsuit was brought by over 200,000 student borrowers, alleging substantial misconduct by the university. A settlement was approved in 2022, and in 2023, the Supreme Court allowed debt cancellation to proceed due to alleged fraud.
As a result of these controversies, investigations, and lawsuits, the University of Phoenix has experienced a significant decline in enrollment. The university's reputation has been damaged, and it has faced increased scrutiny from prospective students and the public. While the university has denied any wrongdoing in its settlements, the evidence gathered by the FTC and the subsequent loan discharges by the federal government have further impacted its enrollment numbers.
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Frequently asked questions
The University of Phoenix has not admitted any wrongdoing and has not voluntarily cancelled student loan debt. However, the US Department of Education has approved federal student loan forgiveness for eligible former students of the university.
Students who attended the University of Phoenix between 21 September 2012 and 31 December 2014 and were deceived by the school's claims about its partnerships with companies may be eligible. These claims were ruled to be deceptive advertising by the Federal Trade Commission (FTC) in 2019.
The US Department of Education has approved the discharge of up to $37 million in loans for former University of Phoenix students. It is estimated that around 1,200 students are eligible for relief.
If you believe you are eligible for loan forgiveness, you can submit a claim through the Borrower Defense program. You will need to provide evidence that you were deceived by the University of Phoenix's advertising and recruitment practices. The status of your application can be checked on the borrower defense page under "Manage My Applications".
