New York For-Profit College Fined For Deceptive Subway Ads
For-profit ASA College has agreed to pay $112,500 in penalties for deceptive ads displayed on New York City subway cars this year. The ads were exposed in a February article on Republic Report, thanks to photos sent to us by eagle-eyed straphangers, including staff of the New York Legal Assistance Group (NYLAG), a non-profit legal services provider that often assists ripped-off college students.
New York’s Department of Consumer and Worker Protection Commissioner Vilda Vera Mayuga on Monday announced a settlement with ASA, one of the biggest for-profit colleges in the city, for advertising that she said was “deceptive and misleading” and violated the City’s Consumer Protection Law.
According to the agency, ASA ran the deceptive ads from January until August of this year, on social media as well as on the subway.
ASA also agreed to comply with the Consumer Protection Law going forward.
Many of the ads seemed to target immigrants. One particularly concerning ad showed a globe covered with flags of many nations, and overseas landmarks including the Taj Mahal, Eiffel Tower, and Rio de de Janeiro’s Christ the Redeemer statue, and it read, “J1*F1*B1/B2 STAY LEGALLY IN AMERICA.” The copy seemed to reference visa categories maintained by the federal government. F-1 and J-1 are designations for visas that allow foreign citizens to study in the United States. But a B-1 visa is for business travel, and B-2 is for tourism and other personal travel; such visas are normally limited to 180 days, and seeking a college degree, as well as taking a job, are not permitted under either status.
In a press release, Commissioner Mayuga said, “Immigrants come from all over the world to NYC in search of a better life and we will not allow them to be the target of predatory and deceptive schemes in their pursuit.”
Other ASA ads suggested that students could graduate in 16 months from specific ASA programs when, according to the Department, that wasn’t possible, and that students would receive a $4,000-$8,000 “gift” upon graduation, but the gift was instead, according to the Department, “a scholarship with many conditions and limitations.”
ASA, which has campuses in Manhattan, Brooklyn, and Hialeah, Florida, has faced controversy in the past. Its owner, Alex Shchegol, was forced out as the college president by his board three years ago amid allegations of egregious sexual misconduct. Last year, Shchegol ousted most of the school’s board members and regained control. But after the New York Daily News exposed the upheaval, and after ASA’s accreditor, Middle States Commission on Higher Education, placed the school on probation, finding it out of compliance with the applicable standards, Shchegol resigned again as president, effective last December 31. Shchegol remains ASA College‘s owner.
At least ten women have accused Shchegol of offenses including rape, coercing students into sex, and sending unwanted pictures of his penis. He left the presidency of the school for the first time in 2018 in the wake of a lawsuit alleging he used a school employee to help him find women to target. The school has paid out more than $2 million in out-of-court settlements over Shchegol’s behavior, according to the Daily News. Shchegol has denied the sexual misconduct charges.
The deceptive ads spurred more scrutiny of ASA by its accreditor, Middle States, and by the Florida agency that oversees for-profit colleges. NYLAG, the legal services organization, wrote to Middle States on March 1, explaining in detail why ASA’s ads are deceptive and improper and calling on the accreditor to “take appropriate action.”
ASA College reported revenues in the 2020-21 academic year of $52 million, with $33.6 million of that total coming from federal taxpayers through student grants and loans. The average annual cost of attending ASA College is $26,099. So while city officials should be commended, and a $112,500 penalty is a positive step, on its own it won’t do much to deter bad behavior by ASA or other colleges. If just a handful of students enrolled at ASA because of the deceptive ads, then the school’s abusive behavior will have paid off despite the fine, at least financially.
UPDATE 10-10-22: On October 7, accreditor Middle States Commission on Higher Education moved ASA College to show cause status, requiring the school to submit by November 1 a report demonstrating why accreditation should not be withdrawn “because of insufficient evidence” that ASA “is in compliance with the Commission’s standards for accreditation, requirements of affiliation, policies and procedures, and applicable federal regulatory requirements.” Middle States’s order directs ASA to document evidence that it is in compliance with accrediting standards and with the terms of its settlement with New York City. Middle States also directs ASA to submit a teach-out plan for students in the event the school shuts down; the accreditor notes, “While ASA College remains accredited on show cause, federal regulations limit the period during which an institution may be in non-compliance, which started October 28, 2021.”