News Summary
The Federal Trade Commission unanimously voted to dismiss allegations against Grand Canyon University, which claimed it misled students about tuition and program costs. The complaint, initially filed against the university’s former parent company, suggested GCU operated for profit while presenting as a nonprofit. Despite this, GCU continues to face a civil lawsuit relating to financial issues with its doctoral programs. The verdict comes as GCU asserts its mission to support student success amid ongoing legal challenges.
PHOENIX – The Federal Trade Commission (FTC) voted unanimously on August 15 to dismiss a long-standing complaint against Grand Canyon University (GCU), a prominent Phoenix-based institution. The complaint had alleged that GCU misled its doctoral students regarding tuition costs and program requirements.
The FTC had initially filed its complaint against Grand Canyon Education Inc. (GCE), the university’s former parent company, towards the end of 2023. This complaint targeted assertions that GCU operated primarily for profit while marketing itself as a nonprofit entity. The case was dismissed with prejudice, meaning it cannot be refiled, in a 3-0 vote by the commission.
GCU is currently recognized as the largest Christian university in the United States, serving over 118,000 students, with the majority enrolled in online programs. The dismissal of the FTC’s lawsuit comes in light of earlier judgments, including a U.S. District Court of Arizona decision that previously dismissed the case against GCU on jurisdictional grounds.
The FTC’s allegations suggested that GCU charged its doctoral students for unspecified “continuation courses” beyond what was publicly advertised, resulting in increased tuition costs. This expansion of total fees reportedly led many students to drop out due to financial burdens. Furthermore, the FTC accused GCU of transferring 60% of its profits to Grand Canyon Education, thus operating largely for profit in contradiction to its nonprofit claim.
FTC Chairman Andrew Ferguson noted the decision to dismiss stemmed from prior unsuccessful outcomes in the case and the minimal benefits to consumers that might arise from continuing the litigation. The agency has experienced several setbacks in cases involving GCU, including the recent retraction of a $37.7 million fine by the U.S. Department of Education earlier in 2024.
In March 2024, the IRS reaffirmed GCU’s nonprofit status, further supporting the university’s position. GCU’s president, Brian Mueller, asserted that the allegations made against the institution were false, maintaining that the university goes beyond the required disclosure standards in its communications to prospective students.
Despite this latest FTC decision, GCU is facing a civil lawsuit that persists, with claims that the university engaged in a racketeering scheme intended to mislead students regarding the financial commitments associated with its doctoral programs. The civil suit notes that affected students reported paying significantly more than the amounts that had been advertised for their degrees.
Throughout these legal challenges, GCU has expressed confidence in its business model and student service, insisting that it has thrived despite the various investigations and accusations that have arisen over recent years. The institution continues to emphasize its mission to support students in achieving their educational goals while asserting that it operates above standard ethical practices.
As the legal landscape surrounding GCU evolves, the university remains a prominent player in the higher education sector, particularly within online learning environments. The outcome of the FTC case and ongoing civil litigation may have lasting implications for the university and its student body.
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Additional Resources
- ABC15
- Wikipedia: Grand Canyon University
- Julie Roys
- Google Search: Grand Canyon University FTC
- Higher Ed Dive
- Google Scholar: Grand Canyon University lawsuit
- KTAR News
- Encyclopedia Britannica: Federal Trade Commission
- Baptist News
- Google News: Grand Canyon University FTC dismissal
Author: STAFF HERE PHOENIX WRITER
PHOENIX STAFF WRITER The PHOENIX STAFF WRITER represents the experienced team at HEREPhoenix.com, your go-to source for actionable local news and information in Phoenix, Maricopa County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Waste Management Phoenix Open, Cactus League Spring Training, and Arizona State Fair. Our coverage extends to key organizations like the Greater Phoenix Chamber of Commerce and Visit Phoenix, plus leading businesses in technology and healthcare that power the local economy such as Intel and Banner Health. As part of the broader HERE network, including HERETucson.com, we provide comprehensive, credible insights into Arizona's dynamic landscape.
