FTC sues Grand Canyon University, alleging deceptive advertising

The Federal Trade Commission has filed suit against Grand Canyon Education, Grand Canyon University, and Brian Mueller – the CEO of GCE and president of GCU – for “deceiving prospective doctoral students about the cost and course requirements of its doctoral programs and about being a nonprofit, while also engaging in deceptive and abusive telemarketing practices,” the FTC announced. The FTC’s complaint also says that, despite operating the school for the profit of GCE and its investors, the defendants deceptively marketed the school as a nonprofit. The FTC alleges that GCU has been operated for the profit of GCE and its stockholders, and pays 60% of its revenue to GCE pursuant to an agreement designating GCE as the exclusive provider for most university-related services. Even though he serves as GCU’s president, Mueller also benefits as both CEO and a stockholder of GCE, and receives bonuses tied to GCE’s performance. The complaint was filed in the U.S. District Court for the District of Arizona.