by

DeVry Settles Federal Lawsuit for $100 Million

DeVry University and its parent company will pay $100 million to settle a lawsuit, brought by the Federal Trade Commission, that claimed the for-profit institution had misled prospective students. A news release from the commission says the settlement “secures significant financial redress for tens of thousands of students harmed by DeVry’s conduct.”

The commission’s lawsuit, filed last January, involved advertisements that said 90 percent of DeVry’s job-seeking graduates were employed in their field within six months of graduating. The university also said its graduates had incomes 15 percent higher than those of graduates of other institutions one year after graduation.

The FTC’s complaint said those claims, used in DeVry’s marketing material and advertisements, were exaggerated and deceptive.

The same month the lawsuit was filed, the U.S. Department of Education said it would require DeVry to “cease making certain representations regarding its students’ postgraduation employment outcomes.”

Of the settlement, $49.4 million will be distributed to some of the students misled by the ads, and $30.35 million will be used to forgive the balance owed on private student loans the company issued from September 2008 to September 2015. The remaining $20.25 million will relieve debts on items like tuition and lab fees.

The news release says DeVry will release transcripts and diplomas withheld from debtor students.

DeVry’s parent company said in a statement that the “DeVry Group chose to settle this action after filing an answer denying all allegations of wrongdoing.”

The settlement is larger than one reached in a federal false-claims lawsuit against the Education Management Corporation. That settlement, reached in November 2015 for $95.5 million, was called “unprecedented” at the time.

Return to Top