WASHINGTON—Sollers College and its parent company, Sollers Inc., have been ordered to cancel $3.4 million in student debt to resolve separate charges brought by the Federal Trade Commission and the state of New Jersey, which said the companies “lured” prospective students to enroll by “falsely” touting their job-placement rates and that their relationships with prominent companies would lead to jobs after students graduate, the FTC said.
The for-profit school also had an illegal twist to the “income share agreements” it encouraged students to take out to pay for the school, according to the FTC’s complaint. Income-share agreements require students to pay the school a percentage of their future income in exchange for covering their tuition, the agency noted.
“Not only did Sollers College use deceptive advertisements to attract students, it trapped them in multi-year income share agreements that broke the law by leaving out important borrower rights,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection. “Today’s order cancels all income-share agreements issued by the school. Companies that skirt long‑standing consumer protection laws when offering new financing products should be on notice that the FTC takes these violations seriously.”
False Claims
According to the FTC’s complaint, Sollers and its parent companyused their website, social media, and email campaigns to falsely advertise their partnerships with prominent employers in the fields of information technology, clinical research, and drug safety.
“Sollers falsely claimed that its partnerships with prominent employers, such as Pfizer, Weill Cornell Medicine, and Infosys, resulted in jobs for its graduates at those companies. In reality, many of the businesses featured on Sollers’ website had no partnership with the school at all,” the FTC said.
The complaint states that, since at least 2018, Sollers advertised that the vast majority of Sollers graduates are placed in jobs.
What the Ads Claimed
“For example, the company advertised, ‘90% of our students are placed within three months of graduation,’ on its website. In reality, the job placement rate for Sollers graduates is substantially lower than the 80%, 82%, 90% or ‘near perfect’ rates featured prominently on its website and in its advertising campaigns. For example, the school’s own data suggests that the current job-placement rate for graduates of its Life Sciences programs remains as low as 52%,” the FTC stated.
In addition, the complaint notes that Sollers encouraged students to pay for their education using income-share agreements.
Terms of Agreement
Under the stipulated order, the for-profit is prohibited from falsely advertising any educational product or service. The order also prohibits the company from denying access to diplomas or transcripts based on any debt forgiven by the proposed order.
FTC said Sollers must:
- Stop collecting debts from students on any income-share agreements it currently holds
- Re-purchase any income share agreements it sold to third parties to stop collection efforts on those agreements
- Request that consumer reporting agencies delete the debt from consumers’ credit reports
- And provide written notification to consumers who are receiving debt forgiveness under the proposed order
Are You Being Gouged for Bank-Like Subscription Fees for Old News? Here’s a CU-Like Way to Fix That
The biggest, best and freshest news reporting in credit unions remains free! Each morning CUToday.info delivers its daily Fresh Today news update offering the latest headlines and breaking news right to your email, with the easy-to-read headlines format allowing you to click on the stories that interest you most in order to learn more. So, stop paying those bank-fee-like subscription prices from other so-called “news” publications!
If you haven’t yet signed up for the new email solution on which CUToday.info has partnered with ResponseGenius, you can do so here. Signing up requires less than one minute of your time—and it’s free!
Please note that after signing up you may need to go to your Spam/Junk folder and mark the morning headlines email as safe. CUToday.info does not provide its list of readers and emails to outside parties, and we will not be contacting you to sell you an extended warranty or sending you any links so you may cash in on an inheritance you didn’t know was coming.
And did we mention it’s free?