May 28, 2015
This week, the Federal Trade Commission (“FTC”) announced that Professional Career Development Institute, LLC, doing business as Ashworth College, agreed to an $11 million settlement for allegedly engaging in deceptive advertising in violation of the FTC Act. Specifically, in its Complaint, the FTC alleged that Ashworth College misrepresented, among other things, that credits earned through its courses could be easily transferred to other schools, and that completion of its courses would provide the adequate credentials and training for students to seamlessly transfer careers.
How did Ashford College perpetrate the alleged deceptive advertising scheme?
Ashworth College ran into problems as a result of the systemic ways in which it made its alleged misrepresentations to current and prospective students. Ashworth College maintained a staff of “Admissions Advisers” that in reality were professional sales representatives who were trained to use high-pressure tactics to persuade consumers to enroll in various courses, and who otherwise aggressively represented to consumers the alleged false benefits of its programs. Specifically, the FTC alleged that the misrepresentations occurred in connection with Ashworth College touting the ability of its courses to provide students with the comprehensive training and credentials necessary to switch careers or obtain new jobs. However, in many instances, the programs were not recognized by state licensing boards and, therefore, did not meet the basic educational requirements set for careers in those fields. Additionally, Ashworth College representatives and promotional material also represented that credits earned through its courses could be easily transferred to other schools, despite the fact that the vast majority of schools only allow transfers of credits from regionally accredited schools, while Ashworth College was only nationally accredited.
The Deceptive Advertising Settlement with the FTC Includes the Following Prohibitions:
- No further representations that Ashworth College course credits are recognized or accepted by other schools;
- No further representations that Ashworth programs provide all required training or credentials necessary to switch careers or obtain a job in a new field;
- No further representations that completing Ashworth programs will enable students to qualify for vocational licenses without any further training or experience.
Protect Yourself from FTC Scrutiny
We continue to provide our blog readers with reports on the FTC’s aggressive pursuit of companies that engage in deceptive advertising. The steady stream of complaints, judgments and settlements reinforce the fact that marketers that tout the benefits of their products/services must ensure that these representations comply with applicable state and federal advertising laws.
If you are interested in learning more about this topic, or if you have been served with legal process relating to deceptive advertising, please e-mail us at info@kleinmoynihan.com or call us at (212) 246-0900.
The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.
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