(Federal Trade Commission) The Federal Trade Commission (FTC) proposed a settlement of $43.5 million against a company that targeted military members and their families for its services.
In the complaint, Career Step is alleged to claim customers could complete the courses in less than six months, with 84% of graduates finding jobs in their field. These claims were doubled down toward military members. Career Step also promised to provide job placement. Reviews found in various reviews, including with the Better Business Bureau, showed positive endorsements, among other infractions.
The FTC found that most enrolling into the programs never completed the course, and those that did took much longer than the promised six months, averaging over 16 months to complete. In addition, the claimed 84% of career finders was calculated from an optional survey that only went to those who completed the program, estimated at 5% of all enrollees since 2020.
The settlement seeks to have Career Step pay $15.7 million in redress and cancel $27.8 million in debts still owed by students from February 2020 to February 2023.
Career Step had offered extended training in return for students posting reviews on Google, Trustpilot and the Better Business Bureau, with emailed instruction to refer to the extended training they would receive in posting the review, per FTC guidelines.
The complaint alleged the employment placement promise were deceptive, as agreements with companies were not in regard to hiring. Students promised externships never got one, even in programs requiring externship.
The complaint violated the FTC Act in making multiple misrepresentations about program benefits, falsely claiming that reviews found on third party websites were independent and failing to disclose the connection between the company and the endorser. It also alleges that Career Step violated the Gramm-Leach-Billey Act, making “false, fictitious, or fraudulent” statements to obtain customer information from a financial institution.
Complaints and violations may be reported online at ftc.gov
