FTC, Dept. of Education File Complaint against DeVry University for Deceptive Advertising

FTC, Dept. of Education File Complaint against DeVry University for Deceptive Advertising
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January 27, 2016

DeVry University is the latest for-profit college in the crosshairs of the Federal Trade Commission (FTC) and U.S. Department of Education.

The FTC this week filed a suit against the college's operators for airing advertisements that deceived future students about the likelihood that they would find jobs in their fields of study, and would earn more than those graduating with advanced degrees from traditional colleges or universities.

In its complaint against DeVry, the FTC alleges that the advertisements claim that 90 percent of graduates actively seeking employment laded jobs in their field within six months of graduation and made 15 percent more than their peers who graduated from other colleges or universities. DeVry has been running the employment claim in its marketing since about 2008 and began touting the income numbers in 2013.

The FTC found that in the 2012 graduating class there were multiple graduates who were working, but not in their field. Examples include one student who majored in business administration, but was working as a server in a restaurant. Another was working as a car salesman. Technical management majors were unpaid volunteers, rural mail carriers, and construction workers.

DeVry's calculations allegedly included graduations who were working in jobs they held prior to enrolling at the school, as opposed to those they landed after graduating. The college also padded its numbers by excluding graduates who were seeking employment. This included, for example, a graduate who had viewed more than 175 job openings in DeVry's jobs database, interviewed for six jobs in the two months prior to being classified as inactive, repeatedly e-mailed the DeVry career services department, and attended a DeVry career fair.

The FTC says that the college should have questioned the reliability of the conclusions and information contained in a third party survey and report that it used as the basis for the income claim. Using information directly from graduates and publicly available income data showed that graduates didn't earn significantly more than their peers.

Along with the FTC, the Department of Education is also taking action against the college for its marketing practices. The Department is requiring that DeVry both stop its deceptive advertising and take additional steps to substantiate any claims it does make in its marketing.