DeVry University and its parent company has agreed to a $100 million settlement after a Federal Trade Commission lawsuit alleged they misled prospective students with advertisements that touted high employment success rates and income levels upon graduating.
According to the FTC, DeVry will pay $49.4 million to students who were affected by the ads and another $50.6 million in debt relief. The debt that is being forgiven applies to all private unpaid student loans that DeVry issued to undergraduates between September 2008 and September 2015 and for items such as tuition, books and lab fees.
FTC’s complaint stated DeVry misled consumers by claiming that 90 percent of graduates actively seeking employment landed jobs in their field within six months of graduation. These ads appeared on various platforms like television, radio, online print and other media.
“When people are making important decisions about their education and their future, they should not be misled by deceptive employment and earnings claims,” said FTC Chairwoman Edith Ramirez.
A federal court order will require the for-profit college to notify the students who will receive debt relief, and to inform the credit bureaus and collection agencies of the debt forgiveness. All loan and debt forgiveness will occur automatically. DeVry will also release transcripts and diplomas previously withheld from students because of outstanding debt and will cooperate with future requests for diplomas and transcripts and related enrollment or graduation information.
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