Federal Trade Commission Accuses DeVry University Of Lying About Employment Potential
LOS ANGELES (CBSLA.com) — DeVry University, which has five Southern California campuses and one in the San Diego area, was sued by federal regulators Wednesday for allegedly lying about its students' job prospects and earning potential.
The Federal Trade Commission's complaint against DeVry University claims the for-profit trade school (PDF) deceived consumers by claiming that 90 percent of its students seeking employment were hired in their field within six months of graduation.
"Educational institutions like DeVry owe prospective students the truth about their graduates' success finding employment in their field of study and the income they can earn," FTC Chairwoman Edith Ramirez said in a statement announcing the suit, which was filed in federal court in Los Angeles.
DeVry said it would "vigorously" contest the FTC's allegations in court.
"The FTC's complaint -- filed 40 years after DeVry University began publishing accurate graduate employment statistics -- is without a valid legal basis," the Downers Grove, Illinois-based company said in a statement. "There is no national standard for calculating employment statistics among higher-education institutions, and the measures and standards used by DeVry University to support its statistics are appropriate."
DeVry was accused of counting many graduates as working "in their field" when they were not, including a business administration graduate working as a server at the Cheesecake Factory restaurant, graduates who majored in technical management working as unpaid volunteer positions at medical centers, and a business administration graduate with a health care management specialization working as a car salesman.
In a related action, the U.S. Department of Education gave notice to DeVry to stop certain advertisements regarding student employment outcomes.
DeVry -- which has campuses in Sherman Oaks, Long Beach, Anaheim, Pomona, Colton and Palmdale -- responded that it would request a hearing to contest the department's notice.
Another for-profit college chain, Santa Ana-based Corinthian Colleges Inc., closed and filed for bankruptcy last year amid allegations it falsified job-placement data in its marketing materials and altered grades and attendance figures.
After Corinthian's collapse, the Department of Education said it was crafting new regulations to help students seek debt relief and better hold colleges accountable for wrongdoing.
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