Trump Administration Cancels $37 Million Fine Levied Against Grand Canyon U For Deceiving Students
The Donald J. Trump administration, which claims its DOGE-driven reshaping of the federal government is aimed at cutting waste, fraud, and abuse, quietly cancelled a $37 million fine that the Department of Education, under the Biden administration, imposed in 2023 on Grand Canyon University. The fine was levied after Department investigators documented extensive findings that GCU, which takes billions in taxpayer dollars, systematically deceived students about the costs of their educations.
Grand Canyon announced the cancellation of the fine on its website on Friday.
Grand Canyon had appealed the fine to a review panel inside the Department. Republic Report contacted Grand Canyon spokesperson Bob Romantic last Wednesday inquiring about the status of the appeal; he messaged me that he would get back in touch Thursday to respond, but he didn’t respond to my follow-up message that day. The Department of Education did not reply to my request last week for comment on the appeal.
In its announcement Friday, Grand Canyon stated that the Department, by means of “a Joint Stipulation of Dismissal order issued by ED’s Office of Hearings and Appeals” acted to “dismiss[ ] the case with no findings, fines, liabilities or penalties of any kind.”
Grand Canyon, which bills itself as a Christian school, had waged a public campaign claiming it was attacked by the Biden administration on the basis of politics and religious persecution.
[UPDATE 05-20-25: A Department of Education spokesperson Monday offered a statement ratifying Grand Canyon’s claim of victimization: “Unlike the previous Administration, we will not persecute and prosecute colleges and universities based on their religious affiliation.”]
In reality, the $37 million fine, indeed unusually large for the Department, was appropriately pegged to the gravity and scope of the abuses, as well as the size of the institution and the taxpayer funds it receives: Phoenix-based Grand Canyon, which in 2022-23 enrolled more than 100,000 students in-person and online, gets the largest amount of federal student aid of any college or university in the country. GCU received $862 million from taxpayers for Department of Education federal student grants and loans in 2022-23 out of $1.3 billion in revenue, and received additional federal funding for student aid from the departments of Defense and Veterans Affairs.
In a 34-page letter addressed to Grand Canyon president Brian Mueller in October 2023, the Department described in detail the deceptive conduct found by its investigators.
The Department concluded that Grand Canyon “lied to more than 7,500 former and current students about the cost of its doctoral programs over several years. GCU falsely advertised a lower cost than what 98% of students ended up paying to complete certain doctoral programs.”
The probe found that going back to 2017, GCU violated the prohibition in federal law against making “substantial misrepresentations” by failing to tell students enough about the cost of the school’s doctoral programs and stating on the school website and in other materials that the programs cost between $40,000 and $49,000. GCU’s own data, according to the Department, shows that less than 2 percent of graduates completed their students within the cost range that GCU advertised. Most students needed to enroll in and pay for “continuation courses” to complete the dissertation requirement in these doctoral programs. The school’s data also showed that 78 percent of doctoral program graduates had to pay between $10,000 and $12,000 more than GCU had advertised.
According to the Department, Grand Canyon “did not contest [the Department’s] determination that 98% of students enrolled in certain doctoral programs had to pay more than GCU’s advertised cost.”
Yet the Department under new Trump education secretary Linda McMahon has now let Grand Canyon off the hook.
GCU President Mueller said in a statement Friday, “The facts clearly support our contention that we were wrongly accused of misleading our Doctoral students and we appreciate the recognition that those accusations were without merit.”
Educator Mueller, who makes $661,000 as president of non-profit Grand Canyon University, and then another $2 million a year as CEO of the school’s for-profit servicing arm Grand Canyon Education, held a scare rally on the GCU campus in 2023 after his school was fined. There, he warned his audience, “There is a group of people in Washington DC who has the intention to harm us.” He also advanced the baseless and incendiary claim, subsequently echoed by conservative influencers, that Grand Canyon was targeted because it presents itself as a Christian school.
But the evidence developed by the Department’s investigation that GCU deceived doctoral students was echoed by many of those affected: The Department said last year that it had received more than 750 complaints by doctoral students against GCU since 2020.
As in the first Trump administration, people connected to for-profit colleges now have influence over higher education decisions at the Department. For example, Trump’s nominee for Under Secretary of Education, Nicholas Kent, currently a senior adviser at the Department, once was a senior staff member at the for-profit college lobbying group CECU. Prior to that, Kent was an executive at Education Affiliates, a Baltimore-based for-profit college operation that faced civil and criminal investigation and actions by the Justice Department for deceptive practices.
Another federal agency, the Federal Trade Commission, also has taken action against Grand Canyon, suing the school, for-profit arm Grand Canyon Education, and Mueller in Arizona federal court in December 2023 over the same deceptive claims to doctoral students about the costs and course requirements of programs — and claims about the school’s nonprofit status. The FTC also alleged that Grand Canyon engaged in deceptive and abusive telemarketing.
Grand Canyon has twice moved to throw out the FTC lawsuit, and the judge has dismissed some aspects of it, including removing GCU as a defendant, but the case is still pending, bogged down in disputes over discovery. (Mueller’s personal attorneys in the case include former U.S. solicitor general Paul Clement and Steven Gombos.)
Grand Canyon said on Friday that the FTC lawsuit continues “despite the fact the lawsuit essentially raises the same manufactured nonprofit and doctoral disclosure claims that have been refuted, rejected and dismissed.”
The Trump administration has cancelled numerous law enforcement investigations against entities that have shown fealty to or ideological kinship with President Trump, and has fired the two Democratic commissioners on the FTC. But the FTC case against GCU, at least for now, is proceeding.
While some in the career college industry donated big to Trump, federal records show only one political contribution by Brian Mueller in the last federal cycle: $1000 in 2023 to Mike Pence for President.
Part of Grand Canyon’s righteous anger toward the Department of Education during Biden’s term focused on the Department’s refusal to recognize Grand Canyon as a non-profit school for purposes of Department rules, even though, after Grand Canyon converted its school from for-profit to non-profit, the IRS granted the school that status for tax purposes. But the ties between supposed non-profit Grand Canyon University and for-profit Grand Canyon Education were so blatant — GCU sends most of its revenue to publicly-traded GCE, and Brian Mueller is the head of both operations — that GCU’s non-profit status was rejected not by Biden education secretary Miguel Cardona, but by his predecessor, deeply Christian and deeply for-profit college-loving Betsy DeVos. (Last November, a panel of the U.S. Court of Appeals for the 9th Circuit reversed a district court decision upholding the Department’s denial of non-profit status to GCU and remanded to the Department to revisit the decision under a different legal standard.)
Even if the Trump administration has cancelled the Biden education department’s effort to protect America’s students from Grand Canyon’s deceptive and predatory practices, Grand Canyon’s legal troubles are not over. Beyond the FTC case, in June 2024, students filed a class action lawsuit against Grand Canyon Education, alleging that the company “orchestrated a deceitful racketeering scheme by misleading prospective students about the true cost of doctoral degrees at Grand Canyon University….” On May 6, a federal judge in Arizona rejected all but one of the arguments raised by GCE in a motion to dismiss, meaning the case will move forward on most of the students’ claims.