Fraud Claims against Ashford University

//Fraud Claims against Ashford University

Ashford University and its parent company, Bridgepoint Education, have faced allegations and claims of fraudulent activity by Tom Miller, Iowa Attorney General, in regards to Ashford University’s high-pressure sales tactics, misuse of federal student aid funding, withholding important information, and in regard to their rather substantial non-refundable fees. Ashton University’s website claimed that yearly technology fees were only $50 per year but students were charged upwards of $900 in technology fees and these were not refunded if a student dropped out in a timely fashion.

Students interested in the program and who enrolled were told that they would be qualified as classroom teachers after completion of Ashford’s program and this was an outright lie. The Department of Education denied Ashford’s request for its Masters of Arts in Education program and indicated that the program was not a program that met its criteria. Students of the school would not be receiving any clinical experience with real students, the course itself was more a collection of classes rather than a course of study, and that it lacked the guidance necessary to be provide students with teacher certification or licencing. Considering 63, 624 students, 96% of them online, were enrolled in Ashford programs at the time, this was quite concerning.

The Department of Education audited Ashford University in 2008 and found plenty to make claims about. Ashford was retaining credit balances without proper authorization, students were not receiving refunds they should have when dropping the program, and enrollment officials were receiving incentives based on the number of candidates they enrolled. Further poking around indicated that Ashford University as misusing federal student financial aid and taking advantage of both students and tax payers, that the school and its parent company were violating the Consumer Fraud Act., and that student financial aid was not being dispersed properly.

Over $130 million in such funds was improperly obtained from the government, as per an inspector general, and were still in Ashford’s possession and had not been returned. Students who were supposed to receive such funds did not receive them and those that did receive them were usually ineligible to receive federal funding. Over 86.5% of Ashford University’s $216 million profit in 2010 was obtained through federal programs but the programs themselves had over 63% dropout rates. Students who graduated from the program in question found that their certificate was a really expensive piece of paper that would not be getting them a job without additional studies and clinical experience and were left with substantial student loans they had no way of paying.

Early in 2014, Ashford University and its parent company agreed to a settlement in regards to many of these claims by the Attorney General. In the voluntary compliance settlement, Ashford agreed to reimburse $7.25 million to former and current students, and correct its policies for enrollment. An orientation program was to be implemented, predatory and coercive enrollment practices were to be immediately corrected, and statements or information misleading students into believing they would be licenced teaching professionals at the end of their course of studies were to be stopped.

If you have questions or comments, please chat in the comments below or on the ChallengeStudentDebt Twitter handle.

If you feel you were defrauded by the school you attended or you are being treated poorly as a distressed borrower by your creditors, take the free challenge debt review to find out what options you have regarding your student loans.

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