US FTC sues Grand Canyon University for deceptive advertising, illegal telemarketing

WASHINGTON (Reuters) -The U.S. Federal Trade Commission said on Wednesday it has filed a lawsuit against Grand Canyon University for deceptive advertising, illegal telemarketing and misrepresenting the school as a nonprofit.

The FTC filed a complaint against Grand Canyon Education (NASDAQ:) Inc (GCE), its CEO and the university in the U.S. District Court for the District of Arizona.

The FTC accuses them of “deceiving prospective doctoral students about the cost and course requirements of its doctoral programs and about being a nonprofit, while also engaging in deceptive and abusive telemarketing practices,” according to a statement.

The university “has been operated for the profit of GCE and its stockholders, and pays 60% of its revenue to GCE,” the commission alleges.

GCE describes the university as a “partner” in regulatory filings.

The Arizona-based university did not immediately respond to a request for comment.

The lawsuit follows a $37.7 million fine on the university by the U.S. Education Department for misrepresenting the costs of its doctoral programs, according to CNBC.

Fewer than 2% of the school’s doctoral program graduates completed their program within the advertised cost, and almost 78% of these students take five or more continuation courses, according to the Education Department.