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RICO Lawsuit Filed on Behalf of Students Against Grand Canyon Education, Inc.

June 12, 2024

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RICO Lawsuit Filed on Behalf of Students Against Grand Canyon Education, Inc.
Former doctoral students allege Grand Canyon Education, Inc. defrauded them for millions by lying about tuition costs

WASHINGTON, DC—Grand Canyon Education, Inc. (GCE) orchestrated a deceitful racketeering scheme by misleading prospective students about the true cost of doctoral degrees at Grand Canyon University (GCU), according to a class action lawsuit filed on behalf of students today by DiCello Levitt LLP and Student Defense.

From the beginning of 2017 through October 2023, “GCE propagated false information about the true cost of Grand Canyon University’s doctoral programs” through its marketing materials, sales representatives, and enrollment applications and agreements, the students allege. 

According to the complaint, which was filed in the United States District Court for the District of Arizona, GCE told students that the “estimated tuition” for their doctoral degrees would equal the cost of 60 or 65 credits. But senior GCE executives knew that at least 70% of those students would be forced to pay thousands of dollars more for “continuation courses'' to obtain their degrees. 

“We need to hold Grand Canyon accountable for the lies they told Ph.D. candidates about the real cost of their education at GCU,” said DiCello Levitt Founding Partner Adam Levitt. “Choosing to pursue a doctoral degree is one of the most expensive and life-shaping decisions many people make, and they deserve to know the true cost that they’re committing to. We filed this class action lawsuit to ensure Grand Canyon stops these deceptive practices and other for-profit colleges don’t even try them.”

“Grand Canyon recruited students with false promises about tuition costs, then padded their pockets with the extra charges students were forced to pay to secure their degrees. Grand Canyon exploited its students' commitment to their education, by imposing extra charges when they were on the brink of finishing,” said Student Defense Litigation Director Eric Rothschild.   

The class action suit alleges that GCE defrauded students out of millions of dollars annually in violation of the federal Racketeering Influenced and Corrupt Organizations (or RICO) Act as well as state consumer protection laws.

To orchestrate and profit from this fraud scheme, GCE exploited its control over Grand Canyon University. Specifically, to facilitate its aggressive recruiting and telemarketing efforts directed at prospective students like Plaintiff, GCE used the proceeds of its fraud scheme to establish Grand Canyon University as a nominally independent, not-for-profit entity in July 2018.  Beneath the veneer of nominal independence, however, GCE continued to control Grand Canyon University and used it as a RICO enterprise for carrying out GCE’s fraud scheme against prospective students.

Last fall, the United States Department of Education fined GCU $37.7 million after its investigation found that the school “lied to more than 7,500 former and current students about the cost of its doctoral programs over several years,” and“GCU falsely advertised a lower cost than what 98% of students ended up paying.”

Read the full complaint on the Student Defense website.