Alleged misrepresentations and unconscionability in the training industry

The ACCC has commenced proceedings in the Federal Court against a training college which offered VET FEE-HELP Diploma courses,costing from $18,000 to $21,000 per course.ACCC

It is alleged that:

False or misleading representations

  • between January and October 2015, Phoenix Institute of Australia Pty Ltd and Community Training Initiatives Pty Ltd (through the trading name “Mytime Learning“) enrolled more than 9,000 students in 17,000 courses and received in excess of $100 million from the Commonwealth for those enrolments.
  • Phoenix represented to prospective students that:
    • they would receive a free laptop; and
    • the course(s) were free – or free if the student did not earn approximately more than $50,000 per annum.

In fact:

  • the laptop was received on loan; and
  • the course(s) incurred a VET FEE-HELP debt payable to the Commonwealth Government, with repayment commencing once the student earned more than a particular amount ($54,126 in the 2014-2015 income year).

Unconscionable conduct

  • The enrolment process targeted vulnerable groups, such as consumers from low-socioeconomic background and consumers with intellectual disabilities
  • The courses were online, requiring a computer and ability to email, something which was difficult for many of the enrolled students to comply with.

The ACCC is seeking orders cancelling the VET FEE-HELP debts and pecuniary penalties.  The ACCC and the Commonwealth are seeking:

  • declarations,
  • injunctions,
  • orders for the repayment of course fees paid by the Commonwealth to Phoenix
  • corrective notices
  • orders requiring the implementation of a consumer law compliance program
  • costs.

The matter will be first heard in the Federal Court on 15 December 2015.

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