Georgia-based Ashworth College, a for-profit college with approximately 50,000 students, has agreed to settle charges that it misled students about career training and credit transfers, the FTC has announced. According, to the FTC’s complaint, several programs offered at Ashworth don’t even meet the basic educational requirements set by the Georgia state licensing board, including those for real-estate appraisers, home inspectors, elementary school educators and massage practitioners, despite the school’s claims that students get the training and credentials required to switch careers or get a new job. The FTC also alleges the institution claimed that its credits would transfer even though it lacked supporting data that other colleges and universities would accept their credits.
Under the terms of the settlement, Ashworth is prohibited from misrepresenting that: 1) completing Ashworth’s program will qualify students to obtain vocational licenses without any additional training or experience; 2) Ashworth’s programs provide all the training and credentials required to switch careers or obtain a job in a new field; 3) there will be job security or steady employment for consumers completing its programs; and that 4) course credits are generally recognized by, and accepted, by other postsecondary institutions. Additionally, the order also includes an $11 million judgment, which will be suspended based upon the institution’s inability to pay.
However, even though Ashworth ultimately decided to settle the charges with the FTC, Ashworth said the issues tackled by the FTC represented “a few isolated incidents” and ignored the school’s nearly three-decade track record. In a statement released by Ashworth, the school said:
The FTC missed the mark by targeting Ashworth College, and the College emphatically disputes that its practices did not comply with regulations. Rather than focus on the effective, career-focused programs that Ashworth has continually delivered to students for nearly 30 years, the FTC instead focused on a few isolated incidents that are not representative of Ashworth’s practices and policies. We believe the numbers tell the real story: as we report to our accreditor, for our career and degree programs combined, Ashworth College has a 91 percent student satisfaction rating, 93 percent of students report achieving their goals after completing their studies and students graduate without student loan debt. Although we disagree strongly with the FTC’s allegations, we nevertheless elected to settle this matter rather than prolong it so we can focus our energy and resources on what matters most: delivering effective, flexible and affordable educational programs to students with diverse education goals and who are often underserved. To prevent further disputes we decided to redouble our compliance efforts, instituting bolder disclosures, expanded training and additional safeguards, and ultimately the FTC completely suspended the financial judgment associated with its complaint. We are moving forward and our attention remains on continuing to advance a responsible model of career-focused education that delivers high student ROI.
From these statements, it is clear that Ashworth did not agree with the FTC’s actions, but chose to settle the charges anyway so it could focus on providing the very best education to its students. Even still, the FTC’s actions are garnering the praises of certain consumer advocates. Consumer advocates have been thrilled to hear the FTC is scrutinizing the for-profit industry. In 2013, the FTC released information to military members advising them about how some for-profit colleges would be more interested in their GI Bill benefits than in helping students “fulfill their education goals.” “This is definitely a positive development,” said Maura Dundon, senior policy counsel with the Center for Responsible Lending, an advocacy group that focuses on student loans and credit cards. “What I would have liked to have seen is if [the FTC] would have some individual liability for the officers and owners of the [Ashworth] company…. The FTC has a clear commitment to pursuing for-profit colleges and I expect to see more.”
In addition to predicting more FTC charges against other for-profit colleges, Ms. Dundon said she is in favor of Ashworth’s military students having their GI Bill or tuition assistance refunded so they can use those benefits elsewhere. More than a year ago, DeVry Education Group disclosed to investors that the FTC requested documents related to the “advertising, marketing or sale of secondary or postsecondary educational products or services or educational accreditation products or services by DeVry Group during the past five years.” That investigation is still ongoing.
The FTC’s settlement with Ashworth signals the FTC’s ongoing interest in for-profit educational institutions, and makes clear that “when schools promise students they can transfer course credits or get a better job after completing their programs, they’d better be able to back up those claims,” said Jessica Rich, Director, FTC’s Bureau of Consumer Protection. “Ashworth College didn’t tell the truth when it made those promises to prospective students.”