Agency: Federal Trade Commission (FTC)Washington
Description:
On December 10, 2019, the Federal Trade Commission filed a Complaint for Permanent Injunction and Other Equitable Relief against The University of Phoenix (UOP) and its parent company Apollo Education Group, Inc alleging that they used deceptive advertisements falsely touting their relationships and job opportunities with companies such as AT&T, Yahoo!, Microsoft, Twitter, and The American Red Cross. To resolve the complaint the company agreed to pay $191 million.
The FTC alleged that UOP and Apollo relied heavily on advertising to attract students, including specific ads that targeted military and Hispanic consumers. The companies’ ads featured employers such as Microsoft, Twitter, Adobe, and Yahoo!, giving the false impression that UOP worked with those companies to create job opportunities for its students and tailor its curriculum for such jobs.
In reality, these companies did not partner with UOP to provide special job opportunities for UOP students or develop curriculum. Instead, UOP and Apollo selected these companies for their advertisements as part of a marketing strategy to drive prospective student interest, the FTC alleges.
In addition to falsely touting relationships with companies, the defendants also misrepresented that companies, such as Adobe, American Red Cross, Avis, AT&T, MGM, Microsoft, Newell Rubbermaid, Sodexo, and Twitter, worked with UOP to develop its courses, according to the FTC’s complaint.
The complaint further alleges that UOP’s deceptive advertising and marketing materials targeted active duty servicemembers, veterans, and military spouses, and that the company has been the largest recipient of Post-9/11 GI Bill benefits since the program's inception.
The settlement order requires UOP to pay $50 million in cash, as well as cancel $141 million in debts owed to the school by students harmed by the deceptive ads.
In March 2021, the FTC sent payments totaling nearly $50 million to more than 147,000 UOP students who may have been lured by allegedly deceptive advertisements.
For further information on the action visit the FTC website.
Date of Action: 12/19/2019