President Brian Mueller of Grand Canyon University (GCU) has denounced the allegations put forth by the Federal Trade Commission (FTC) in their lawsuit against the institution as “absurd” and indicative of a targeted effort by the federal government.
The FTC filed a lawsuit against GCU, its marketing arm Grand Canyon Education, Inc. (GCE), and Mueller personally, accusing them of deceptive marketing practices, misleading students about costs, and engaging in illegal telemarketing. Mueller released a statement on Thursday asserting that the FTC’s focus on GCU’s identification as a non-profit entity during a specific timeframe following its transition to non-profit status in 2018 is baseless.
“That transaction was blessed by the IRS, State of Arizona and our accrediting body (Higher Learning Commission), so of course we identified ourselves as a nonprofit because we were… and are,” Mueller said.
“The U.S. Department of Education waited 18 months after the transaction to announce it would not recognize our lawful nonprofit status for the purposes of Title IV funding and demanded at that time that, moving forward, GCU not identify itself as a nonprofit institution based on unsupported speculation that students would confuse GCU’s legal nonprofit status with the Department’s so-called ‘Title IV for-profit status.’ We disagreed with that opinion but cooperated as a good faith gesture,” he argued.
“For the FTC to say now, five years later, that identifying ourselves as a nonprofit institution during that 18-month window was somehow ‘deceptive advertising’ is meritless and the height of absurdity,” he continued.
Mueller has also refuted the allegations made by the FTC that GCE participated in “aggressive marketing calls” to potential students.
“GCE does not make cold calls to prospective students on behalf of GCU. It only reaches out to those who have inquired about GCU’s programs or otherwise expressed interest in attending the university,” Mueller said. “That practice is common among higher education institutions and other entities, yet GCU is being singled out in a blatant example of selective enforcement by this federal agency.”
The GCU president has stated that the Department of Education’s allegations regarding doctoral disclosures and the university’s association with its service provider are identical to the “unfounded accusations” made by the FTC. It is worth noting that the school was fined $37.7 million by the Department of Education in October.
“I won’t spend time refuting those since we have already done so,” Mueller said. “But the fact that the FTC is using the same accusations as the Department of Education makes it clear that the two agencies are coordinating efforts and suggests that the FTC’s real goal is to further burden GCU by forcing it to defend against duplicative lawsuits.”
He added, “Sadly, there are no checks and balances in place to prevent this type of blatant and unwarranted government overreach.”