FTC: DeVry University Agrees to Pay $100 Million Settlement in False Ads Lawsuit

DeVry University and its parent company, DeVry Education Group, have agreed to pay a $100 million settlement after being accused of misleading prospective students, the Federal Trade Commission announced Thursday.

In a January lawsuit filed in a California federal court, the FTC accused DeVry of violating the law by claiming in ads that 90 percent of graduates were hired for jobs in the field they studied in within six months of getting their degree.

Ads for the for-profit school making those claims appeared on TV, radio, online and in other media. DeVry’s target audience for the ads included high-school students and current and former members of the military, lawsuit documents say.

The FTC also accused DeVry of misleading students by claiming that those who graduated from the school with bachelor’s degrees had 15 percent higher incomes one year after graduation compared to other colleges and universities.

“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 in a statement. “The FTC has secured compensation for the many students who were harmed, and I am pleased that DeVry is changing its practices.”

DeVry will pay $49.4 million in cash to qualifying students who were harmed by the false ads, the FTC said. DeVry will also pay $50.6 million in debt forgiveness.

“That figure represents the full balance owed on all unpaid private student loans issued to DeVry undergrads between September 2008 and September 2015 – $30.35 million – plus $20.25 million in student debt for things like tuition, books, and lab fees,” the FTC said in its announcement.

The proposed federal court order, which is pending approval, would require the school to notify students, credit bureaus and collection agencies of the debt forgiveness. DeVry will also have to take steps to prevent what it has been accused of from happening again. The school is also barred from misrepresenting the likelihood that its graduates would get a job as a result of their degrees. DeVry is specifically prohibited from using data on jobs graduates obtained more than six months after getting their degrees in their ads, the FTC said.

"DeVry Group chose to settle this action after filing an answer denying all allegations of wrongdoing," the group said in a statement. "Student services and access to federal student loans are not impacted by the settlement, and at no time has the academic quality of a DeVry University education been questioned."