State of California Sues Ashford University for Ripping Students Off

As the White House administration backs away from the efforts of the Obama administration to crack down on for-profit universities, California has taken a step into that regulatory void.

This week Xavier Becerra the California Attorney General announced during a San Francisco news conference the state was suing Ashford University, a for-profit school, and Bridgepoint Education, its parent company.

The state accuses the online-only university of misleading students over the costs of tuition, piling on student loans and offering little value in return.

The enrollment of the school has reached close to 43,000 students, shows an investigation of the school by the Chronicle of Higher Education completed in early November. The report called Ashford a poster child for ills in the for-profit university sector.

The California AG called the school a nightmare for its students. He added that it calls itself a higher learning institute but was just making lots of money.

Although parent company Bridgepoint Education is San Diego-based, Ashford has enrolled students from across the United States. The Chronicle’s report said that Bridgepoint is under investigation as well by attorneys general in North Carolina and New York.

Becerra, while speaking at San Francisco State University, said that unlike traditional brick and mortar schools, Ashford University does not have laboratories, libraries or even classrooms, yet he added, it charges its students a higher rate or close to $61,000 for a bachelor’s degree online.

Most of Ashford’s students end up not graduating and those that earn their degree often end up being saddled with huge debt and not able to find work in their related field that they studied, shows court documents.

Becerra added that the average loan debt per student for graduates of Ashford was $34,000.

The vice president of investor relations and corporate communications at Bridgepoint Anna Davison told reporters the company planned to vigorously defend the case.

Davison through a prepared statement said that Bridgepoint’s institutions represent a model for how education online is able to better the lives of those who were unable or did not pursue the traditional avenue to earn a college degree.

The lawsuit by the state alleges that the admissions office at Ashford was a sales department that had the culture of a boiler room operation. To succeed in that, often times admission counselors were required to meet enrollment quotas.