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AG Nessel urges FTC to address deceptive earnings claims

Michigan Attorney General Dana Nessel
Posted at 4:42 PM, May 17, 2022
and last updated 2022-05-17 18:19:26-04

LANSING, Mich. — Attorney General Dana Nessel joined a bipartisan coalition of states urging the Federal Trade Commission to consider state enforcement efforts while addressing for-profit schools’ deceptive earning claims.

Illinois’ Kwame Raoul leads the coalition made up of 24 states.

In March, the FTC requested comments regarding deceptive or unfair earnings claims made by a broad range of businesses, including for-profit colleges and universities.

The coalition wants the FTC to consider misrepresentations schools have made with respect to their graduates’ earnings as the agency contemplates proposing rules governing the broad use of such earnings claims.

“These marketing practices are used by bad actors looking to deceive those pursuing their dreams of career advancement and higher salaries through higher education.

“The students attending these institutions rely heavily on student loans to pay tuition at schools that can cost up to four times more than that of a community college. Graduates leave the school with crippling debt, but little else.

“I whole-heartedly stand with my colleagues in making it clear to the FTC that state-level oversight of for-profit schools should not be replaced by the commission’s new rulemaking efforts,” said Nessel.

AG Nessel and the coalition highlight the negative impact of for-profit schools’ misrepresentations, particularly on communities of color, in comments to the FTC.

The attorneys general also emphasize the outsized harm student loan debt can have on students attending for-profit schools.

They say they’ve taken extensive actions in response to misrepresentations, which often promise graduates lucrative jobs in sought-after career fields.

However, the attorneys general say these representations are often false and deceived students can be left with loans that can follow them for the rest of their lives.

Specifically, they submitted a group discharge application to the U.S. Department of Education in April 2021 as a result of ITT Technical Institute misrepresenting graduates’ projected annual earnings by up to $100,000.

The coalition also points to a 2015 settlement with Westwood College that resolved allegations Westwood misrepresented the ability of criminal justice students in Illinois to be employed as police officers in Illinois.

Attorneys general of California, Colorado, Connecticut, Delaware, Hawaii, Idaho, Iowa, Maine, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Washington and Wisconsin, as well as the Hawaii Office of Consumer Protection join Attorneys General Nessel and Raoul to make up the coalition.

You can view their full letter to the FTC here.

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