Indianapolis company focus of lawsuit, FTC probe

File Photo.
File Photo.

NDIANAPOLIS (AP) — An Indianapolis company that promises clients faster routes to college degrees for a price is under investigation by federal and state authorities and is the subject of a class-action lawsuit filed in Ohio.

More than 200 consumer complaints against The College Network have been filed with the Indiana attorney general’s office since 2013, The Indianapolis Star reported. Nearly 100 others have been filed in Ohio, Texas and Florida, alleging that salesmen deceived clients and used high-pressure sales tactics to entice people to sign for thousands of dollars in up-front purchases financed by long-term personal loans.

The College Network denies the allegations, saying the people complaining are a tiny percentage of its customers. Vice President Mark Ivory told The Star in an email that the company provides easy financing to customers as a convenience.

But customers complain the salespeople, also called program advisers, pressure them to commit to large up-front purchases of online test preparation materials and academic support so they can pass equivalency exams for college credit. They also contend the advisers have omitted key information, including the loan terms and the fact that buying the company’s material does not guarantee they will be accepted to college.

The Federal Trade Commission and Indiana attorney general’s office are investigating.

Ivory said he expects the company to be cleared by the FTC as it was in a separate investigation more than 15 years ago.

Customers pay $615 for each of The College Network’s “comprehensive learning modules.” Ivory defended the cost, saying customers are able to work at their own pace and receive an extensive introduction to the program and “comprehensive” academic support.

But complainants say the academic support falls far short of what was promised, and the lawsuit describes the learning materials as “essentially abridged or shorter textbooks for a course … along with a PowerPoint or animated presentation of the same material with a voiceover, and some practice tests.” The lawsuit also claims that study materials for equivalency exams, including sample questions, can be found in books for less than $20.

Unlike student loans, which have deferred payments, customers who finance their purchases with The College Network Payments must begin making payments immediately. If they default, The College Network buys back the debt and assigns it to American Credit Exchange, where College Network owner Gary L. Eyleris is listed as an officer.

Attorney Michael Berler, who is representing plaintiffs, described The College Network as “a predatory sales and marketing machine.”

Berler said universities that have partnerships with the company are “legitimizing the scam” and profiting from the relationship. Purdue University has earned $2.53 million since 2010, while Indiana State has made $1.36 million since 2006.

Purdue officials said in a statement they were evaluating the university’s relationship with The College Network “to ensure it meets our students’ needs, advances our educational mission, and aligns with our focus on affordability and accessibility.”

Melony Sacopulos, Indiana State’s general counsel, said the school would “likely” reassess its relationship with The College Network depending on the outcome of the investigation and lawsuit.

blog comments powered by Disqus