The FTC should not shrug off this latest deception, an abandonment of the company’s legal commitment. The University of Phoenix has a long history of deceiving, abusing, and overcharging students, and, in doing so, sometimes violating the law. The University of Phoenix has not responded to a request for comment. The University of Phoenix agreed in the settlement to a permanent injunction with the FTC that included a specific obligation not to make “any representation… about the benefit or outcome of any product or service… unless the representation is non-misleading…” “No out-of-state tuition” sounds like a benefit to me. Andrew Smith, then the Director of the FTC’s Bureau of Consumer Protection, said at the time of Phoenix’s conduct, “Students making important decisions about their education need the facts, not fantasy job opportunities that do not exist.” In the agreement, Phoenix stated that it did not admit or deny the FTC’s claims. It was the largest financial settlement ever between the FTC and a for-profit college. In December 2019, the University of Phoenix and its parent company, Apollo Education Group, agreed to pay $191 million to resolve Federal Trade Commission charges that the company engaged in deceptive acts when it ran ads giving the false impression that the school worked with companies including AT&T, Yahoo!, Microsoft, Twitter, and the American Red Cross to create job opportunities for its students and tailor school programs for such jobs. The deception is even worse because Phoenix has been caught deceiving students before, and it expressly promised not to do it anymore. One can surmise a motive for Phoenix’s apparent duplicity, beyond the benefit of falsely suggesting that the tuition price is reasonable: State colleges have a far better reputation than schools in the scandal-torn for-profit college industry.

Moreover, the University of Phoenix’s graduation rate, for its largest campus, is 14 percent, so for the 86 percent who don’t graduate, the school is certainly no bargain. And by saying the school doesn’t charge out of state tuition, Phoenix suggests it is charging in-state rates.

The school’s annual cost is $13,038, well below the mid-point of $19,526 for all four-year schools, but significantly higher than the average cost of in-state tuition at state schools, $10,423. People seeing that pitch from the University of Phoenix could thus easily believe, wrongly, that it is a state-run school, and also an affordable one. The text accompanying the video continues, “Here, you’ll enjoy the same fixed, affordable tuition from the start to finish of your program, regardless of which state you live in.” It states, “Some state universities charge higher tuition to out-of-state students - but not University of Phoenix.” That sentence is at best ambiguous - it certainly could be read to mean that the University of Phoenix is a state university - and therefore misleading. Text from the school under the video ad on YouTube adds to the deception. Here’s a screenshot of a video ad we found this week in the Facebook Ad Library, indicating that the University of Phoenix is currently running this advertisement on Facebook pages: Prospective students are often disappointed that a desirable public college in another state would charge them the more expensive out of state tuition hence the appeal of the Phoenix statement that it won’t charge such higher amounts.īut the term “out of state tuition” has no general usage or meaning in the context of for-profit schools. It refers to the fact that many state schools, in order to benefit their own state’s residents, charge lower tuition to students considered “in-state,” than they do to students coming from somewhere else. “Out of state tuition” is a concept applicable to state-operated colleges and universities. The school, long the country’s biggest for-profit college - at one time it was getting $4 billion annually in taxpayer-funded student aid - makes the same claim on the admissions page on its website: The campaign from the University of Phoenix, with video ads on YouTube, Facebook, and presumably elsewhere, touts, “No out of state tuition.” The ads have been running for at least five months.

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