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"U.S. Department of Education Fines Grand Canyon University $37.7 Million for Misrepresenting Doctoral Program Costs"

Education

The U.S. Department of Education, through its office of Federal Student Aid (FSA), has announced a $37.7 million fine against Grand Canyon University (GCU) for deceptive practices related to the cost of its doctoral programs. An extensive investigation by FSA uncovered that GCU had consistently misrepresented the cost of these programs to attract students, resulting in unexpected financial burdens for thousands of students.

GCU was found to have falsely advertised a lower cost for its doctoral programs, claiming that they ranged from $40,000 to $49,000. However, the investigation revealed that less than 2% of graduates were able to complete their programs within the advertised cost, with the majority incurring additional expenses for “continuation courses” necessary to complete their degrees. In some cases, students had to pay $10,000 to $12,000 more in tuition costs than GCU had explicitly advertised, constituting approximately a 25% increase.

In response to these findings, the Department of Education has imposed a $37.7 million fine on GCU, holding the institution accountable for its actions and upholding the integrity of federal student aid programs. The fine is accompanied by specific conditions that GCU must meet to continue participating in these programs, including:

Condition A: GCU is prohibited from making substantial misrepresentations about the cost of obtaining a degree in its doctoral programs. If GCU provides cost information to prospective or current doctoral students, it must disclose the average total tuition and fees paid by graduates and the maximum number of eligible credits for Title IV funds.

Condition B: GCU must engage a monitor to oversee its compliance with Condition A.

Condition C: GCU is required to report quarterly to the Department regarding investigations, actions, or legal proceedings initiated by its accrediting agency or any government agency and pending litigation where class certification is sought.

Condition D: GCU must notify all currently enrolled doctoral students about how to use the Department’s feedback center to submit complaints.

Condition E: GCU must inform its current employees involved in recruiting, admissions, and other services to doctoral students about how to use the FSA Tips line to report misconduct or violations.

The Provisional Program Participation Agreement (PPPA) governs GCU’s participation in federal student aid programs for the next three years. In the 2020–21 academic year, GCU enrolled over 100,000 students, offering a wide range of certificate, undergraduate, and graduate degree programs both in person and online.

FSA Chief Operating Officer Richard Cordray emphasized the importance of this action, stating, “GCU lied about the cost of its doctoral programs to attract students to enroll. FSA takes its oversight responsibilities seriously. GCU’s lies harmed students, broke their trust, and led to unexpectedly high levels of student debt. Today, we are holding GCU accountable for its actions, protecting students and taxpayers, and upholding the integrity of the federal student aid programs.”

This action underscores the Department’s ongoing commitment to enforcing higher education laws and regulations and safeguarding the interests of students, taxpayers, and the integrity of federal student aid programs.

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