FTC warns for-profit colleges ‘on guard’ over false promises on job prospects


The Federal Trade Commission is cracking down on for-profit education, citing deceptive practices.

The FTC has “warned” a total of 70 for-profit higher education institutions, saying the agency will not tolerate false promises about graduate employment and income prospects and will impose “significant financial penalties “to offenders.

“For too long, unscrupulous for-profit schools have attacked students with impunity, facing no penalties for defrauding their students and pushing them into debt,” said FTC President , Lina M. Khan, in a statement. declaration.

The seal of the United States Federal Trade Commission is seen during a press conference at the FTC headquarters in Washington, United States, July 24, 2019 (REUTERS / Yuri Gripas / File Photo) (REUTERS / Yuri Gripas / File Photo / Reuters Photos)


The agency said it was resuscitating its authority over criminal offenses, found in Section 5 of the FTC Act to ensure bad actors pay a price.

The list represents “the largest for-profit colleges and vocational schools in the country,” the FTC said, adding: “Companies that operate these colleges will be advised that they could face significant penalties for engaging in certain practices. illegal.

The practices cited in the notice could result in civil penalties of up to $ 43,792 per violation.

The Commission said the “large-scale initiative” is the first use of its authority for criminal offenses to protect students and their families.

The Authority allows the agency to seek civil penalties against a business that engages in behavior that it knows has been found to be illegal in a previous FTC administrative order, other than a consent order, has declared the Commission.

Complaints to the FTC over education-related issues increased by 70% between 2018 and 2020.

“Many of the practices described in the Notice relate to statements made by institutions regarding the career outcomes of their graduates, including whether a particular career field is in demand, the percentage of graduates who obtain employment in their chosen field. , if the institution can help a graduate get a job, the amount of money a graduate can expect to earn, and other related practices, ”the FTC said.

Signage is seen at the Federal Trade Commission headquarters in Washington, DC, United States, August 29, 2020 (REUTERS / Andrew Kelly / File Photo) (REUTERS / Andrew Kelly / File Photo / Reuters Photos)


“It’s no surprise that being scammed by a for-profit college has more of an impact than the student attending it. A student borrower’s unpayable debts affect his entire family,” the students said. Harvard Law School (HLS) clinical and pro bono programs in a release. June blog post.

The message, titled “Student Loan Truth: For-Profit Colleges Are Not Just Here to Scam Students. low-income households, relying on federal financial assistance dollars to earn money. ”

The post cited a for-profit institution that pushed students to take more loans. “These institutions thrive by making the process intentionally confusing. By drowning students in paperwork and capitalizing on their fear of losing their chance to graduate,” according to the HLS post.

Rear view of university graduates queuing for graduation at university graduation ceremony. The FTC says it will not tolerate false promises of salary or employment for graduates. (iStock) (iStock / iStock)


The FTC said it will work closely with state and federal partners and closely monitor the market.

The Commission provides a connect to the list of institutions that are the recipients of the FTC notice of criminal offenses. “The fact that a school is on this list is NOT an indication that it has done something wrong,” the FTC added.

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