This past August, the Department of Education commenced recoupment efforts for millions of dollars against DeVry University, and in doing so explained: “The recoupment effort follows the Department’s announcement in February 2022 that it had approved claims after finding that, from 2008 through 2015, DeVry had repeatedly misled prospective students across the country.” 12 The Department’s recent actions regarding DeVry University are instructive on this point. The Department has the authority under federal regulations to recoup funds from the University of Phoenix for any such approved loan discharges. 11 While the FTC’s settlement provided relief to certain students for institutional debt, it did not resolve the students’ federal loan obligations, nor, importantly, the school’s potential liability to the Department of Education for any approved Borrower Defense to Repayment loan discharge applications. According to publicly available information, thousands of former University of Phoenix students have filed applications to have their federal student loans discharged. The University of Phoenix faces significant potential liability to the Department of Education. University of Phoenix’s and its successor’s potential liability for hundreds of millions of dollars in federal student loans Students making important decisions about their education need the facts, not fantasy job opportunities that do not exist. This is the largest settlement the Commission has obtained in a case against a for-profit school. UOP will pay $50 million in cash as well as cancel $141 million in debts owed to the school by students who were harmed by the deceptive ads. The FTC’s announcement of the settlement provided: In 2019, the Federal Trade Commission obtained a $191 million settlement with the University of Phoenix to resolve the FTC’s charges of deceptive marketing based on advertisements giving the false impression that the school worked with companies including AT&T, Yahoo!, Microsoft, Twitter, and the American Red Cross to create job opportunities for its students and tailor school programs for such jobs. I was aggressively recruited, lied to about the length and cost of my program, and promised career services that were nonexistent.” 8 7Īccording to one Army Veteran who graduated from the University of Phoenix in 2018, “Phoenix doesn’t treat its students right. Student veterans’ allegations that the University of Phoenix misled them about the cost of their education and job opportunities, and provided low quality education.Allegations from whistleblower(s) that the University of Phoenix certified students who did not have a high school diploma or GED, and deceptively inflated job placement statistics 6.The Department of Education’s determination that there are “strong indicia regarding substantial misconduct” 5 by the University of Phoenix, warranting its inclusion on a list of schools whose students will receive automatic federal loan discharges.Charges from the Federal Trade Commission (“FTC”) that the University of Phoenix specifically “targeted active duty servicemembers, veterans, and military spouses” with deceptive advertising 4.

1 As it appears you may be called upon to judge the wisdom of this transaction, we are bringing to your attention certain issues for consideration-evidence of unfair and deceptive practices by the University of Phoenix, potential liability for hundreds of millions of dollars in federal loans, and poor outcomes for students.Ī history of allegations against the University of Phoenix for unfair and deceptive trade practicesĪlthough the UA System has expressed interest in “supporting the university’s mission of advancing high quality, career focused education” 2 as a reason for affiliating with the University of Phoenix, we are deeply concerned about the University of Phoenix’s documented history 3 and long-running allegations from veterans, students, former employees, and findings by government agencies that the University of Phoenix has engaged in unfair and deceptive trade practices, including:

We are writing to you because the University of Arkansas System (UA System) has confirmed that a nonprofit entity affiliated with the UA System may be seeking to acquire the for-profit University of Phoenix. The undersigned organizations are veteran, student, consumer, civil rights, labor and faculty higher education advocates focused on ensuring that postsecondary students are protected from predatory schools and have access to high quality education that does not leave them with unmanageable debt. RE: University of Arkansas System and University of Phoenix

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