Legal woes have expanded for Grand Canyon University, the nation’s largest Christian university and a school with deep Baptist connections.
Late last year, the Federal Trade Commission sued GCU in a federal court in Arizona, seeking monetary relief and a permanent injunction, according to MinistryWatch, a website that monitors public charities and faith-based ministries.
The FTC lawsuit mirrors a suit filed last fall by the U.S. Department of Education, which resulted in a $37.7 million fine against the university. Both federal agencies charge the Phoenix-based school with lying to more than 7,500 current and former students about the cost of its doctoral programs.
According to the agencies and public reports, GCU advertised its doctoral program is “accelerated,” claiming the cost is the same as paying for 20 courses, or 60 credit hours. The Education Department’s suit reported only 2% of GCU doctoral graduates were able to complete the degree in that span. The remaining 98% had to enroll in “continuing courses” as they worked on their degrees, expanding the cost by thousands of dollars.
“GCU’s lies harmed students, broke their trust and led to unexpectedly high levels of student dept.”
When the Education Department filed its suit, Richard Cordray, COO of the department’s Federal Student Aid office, said: “GCU lied about the cost of its doctoral programs to attract students to enroll. … GCU’s lies harmed students, broke their trust and led to unexpectedly high levels of student dept.”
About two months later, the FTC also cited its authority to bring action against the university. The FTC Act “prohibits unfair or deceptive acts or practices in or affecting commerce,” according to an FTC statement. It noted the commission has authority over “deceptive and abusive telemarketing practices” and charged the university used “deceptive” advertising to market its doctoral program.
GCU has denied the accusations of both the Education Department and the FTC.
The university’s president, Brian Mueller, called the Education Department’s fine and appeals process “a colossal waste of time and a colossal waste of resources” in a press conference last fall. He said the school would appeal all the way to the Supreme Court, if necessary.
“It doesn’t matter to me if the fine is $37 million or $1,” Mueller said. “We’re not going to pay the fine because the truth is just the opposite of what they’re saying. … None of this makes any sense. It’s completely and totally backward.”
After the FTC lawsuit became public, Mueller accused the FTC and the Education Department of ganging up on the school.
“The FTC’s real goal is to further burden GCU by forcing it to defend against duplicative lawsuits.”
“The fact that the FTC is using the same accusations as the Department of Education makes it clear that the two agencies are coordinating efforts and suggests that the FTC’s real goal is to further burden GCU by forcing it to defend against duplicative lawsuits,” Mueller said, according to MinistryWatch, which cited statements he gave to Higher Ed Dive.
Grand Canyon University trains about 118,000 students, 75% of whom are enrolled online.
Grand Canyon began its life as Grand Canyon College, affiliated with the Arizona Baptist Convention. After facing near-bankruptcy, the school converted to a for-profit business. Then after gaining stability and growth, it converted back to nonprofit status.
However, it reportedly pays 60% of its tuition and fees to a for-profit company called Grand Canyon Education, in return for services such as marketing, recruitment and student advising.
The FTC’s lawsuit cites the connection between the university and Grand Canyon Education. It claims the university “operates for the profit of GCE and its investors.”
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