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FTC Puts For-Profit Schools on Notice

Predatory schools

For-profit schools often target student veterans using deceptive marketing and administrative schemes.

These predatory schools are lured by the education benefits carried by most student veterans. To them, veterans using their GI Bill benefits are easy money.

FTC Issues Warning to For-Profit Colleges

In a Federal Trade Commission press release, the FTC announced that it is stepping up its efforts to “stop shady practices on campus.”

In doing so, the FTC will issue a Notice of Penalty Offenses to the largest 70 for-profit colleges. These notices are aimed at the false promises made by the colleges concerning job prospects and potential earnings their graduates have.

Violators of these penalty offenses will face severe financial penalties.

“For too long, unscrupulous for-profit schools have preyed on students with impunity, facing no penalties when they defraud their students and drive them into debt,” said FTC chair Lina M. Khan. “The FTC is resurrecting a dormant authority to deter wrongdoing and hold accountable bad actors who abuse students and taxpayers.”


Bad Actors Held Accountable

One example of these crackdowns is a man who was recently sentenced to 19 ½ years in prison for running a sham HVAC trade school in Texas.

As reported by MarketWatch in late September, Jonathan Dean Davis “opened” an HVAC school in 2013 and defrauded Veterans of $72 million in GI Bill benefits. He used the money to buy a mansion, a Lamborghini, and a Ferrari.

Another recent occurrence happened when the University of Phoenix agreed to pay $191 million for using deceptive ads that falsely portrayed its connections to companies like AT&T, Yahoo!, Microsoft, and Twitter. Students were led to believe that attending the UOP could land them jobs with these tech giants.

Then there’s DeVry University, who paid $100 million to settle charges that it misrepresented the employment and salary prospects for its graduates.

In 2020, College Recon reported that Maryland was the first state to protect veterans from for-profit colleges. Using legislation, the Maryland General Assembly removed “any incentive for an educational institution operating in Maryland to employ deceptive practices that defraud veterans.”


Help For Veteran Students

There are tools available to service members, Veterans, and all students to blow the whistle on bad actors.

If a student has a federal student loan and feels like the school misled them or broke the law, they can apply for loan forgiveness through the Department of Education. Using the DoE’s Borrower Defense to Repayment procedures, which could discharge some or all of your federal student loan debt.

Service members should talk with their Personal Financial Managers to get help with college related financial issues. These counselors are usually part of the following organizations:

  • Airman & Family Readiness Center
  • Army Community Service
  • Fleet and Family Support Center
  • Marine Corps Community Services

In addition, many of these counselors can help with matters relating to the Servicemembers Civil Relief Act.

Veterans can and should contact the VA’s GI Bill Hotline (888.442.4551) to discuss questions or concerns with their school.


Know Before You Go

Before enrolling in any program at any school, for-profit or not, you should gather as much information as you can. 

The Department of Education offers the College Scorecard and the College Navigator tools.

The Federal Trade Commission hosts a Military Consumer website that offers advice on finding and paying for school.

And of course, College Recon offers a College Discovery Platform where you can find School Search and Scholarship Finder tools. 

Using College Recon’s Search Tool, you can narrow your search by filtering for schools that accept Tuition Assistance or are Yellow Ribbon schools. The Scholarship Finder can help service members, veterans, spouses, and military dependents find money for college.

Make these great tools a part of your quest for higher education and avoid predatory for-profit schools.


List of Schools Issued FTC Warnings

  • Academy of Art University Foundation
  • Alliant International University, Inc.
  • American Career College, Inc.
  • American Intercontinental University System, Inc. d/b/a American Intercontinental University
  • American Public University System, Inc.
  • American University of Antigua Inc. d/b/a American University of Antigua College of Medicine
  • American University of the Caribbean, Inc.
  • Asa College, Inc.
  • Aspen University, Inc.
  • Auguste Escoffier School of Culinary Arts
  • Aveda Institute Inc.
  • Technical Education Services d/b/a Aviation Institute of Maintenance
  • Berkeley College Foundation, Inc. d/b/a Berkeley College
  • Bryant & Stratton Business Institute, Inc. d/b/a Bryant & Stratton College
  • Capella University, LLC
  • Carrington College, Inc.
  • Chamberlain University LLC
  • Charter College LLC
  • Colorado Technical University, Inc.
  • Columbia Southern University, Inc.
  • Concorde Career Colleges, Inc.
  • DeVry University, Inc.
  • ECPI University LLC
  • Empire Beauty School
  • Empowerment Schools-Healthcare, Limited d/b/a The College of Health Care Professions
  • Fashion Institute of Design & Merchandising
  • Florida Career Institute, Inc. d/b/a Florida Career College
  • Florida National University, Inc.
  • Fortis Colleges & Institutes
  • Full Sail, LLC d/b/a Full Sail University
  • Galen Health Institutes, Inc. d/b/a Galen College of Nursing
  • Grand Canyon University, Inc.
  • Grantham University, Inc.
  • Gurnick Academy of Medical Arts, LLC
  • Jersey College, Inc.
  • Lincoln Technical Institute, Inc
  • Lincoln College of Technology
  • Los Angeles Film School, LLC
  • Mech-Tech College LLC
  • Milan Institute
  • Miller-Motte College
  • Monroe College, Ltd.
  • MyComputerCareer.edu
  • New York Film Academy Ltd.
  • NUC University
  • Paul Mitchell Advanced Education LLC d/b/a Paul Mitchell Schools
  • Post University, Inc.
  • Rasmussen College, LLC d/b/a Rasmussen University
  • Rocky Vista University, LLC
  • Ross Education, LLC d/b/a Ross Medical Education Center
  • Ross University School of Medicine
  • Ross University School of Veterinary Medicine
  • San Joaquin Valley College, Inc.
  • School of Visual Arts, LLC
  • South College
  • Southern Careers Institute
  • St. George’s University, School of Medicine, Inc.
  • Strayer University, LLC
  • The Sullivan University System, Inc. d/b/a Sullivan University
  • The University of Phoenix, Inc.
  • Tulsa Welding School
  • United Education Institute
  • Unitek College NCP, LLC
  • Universal Technical Institute, Inc.
  • University of St. Augustine for Heath Sciences, LLC
  • Vista College, LP
  • Vocational Training Institutes, Inc. d/b/a Pima Medical Institute
  • Walden University, LLC
  • Waldorf University
  • West Coast University, Inc.

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