The ACCC alleges that from 7 September 2015 the College, in seeking to improve its financial performance, removed consumer safeguards from its enrolment and withdrawal processes for online courses. ACCC Commissioner Sarah Court stated
We allege that Captain Cook College engaged in systemic unconscionable conduct designed to maximise profit at the expense of their students
We are very concerned by Captain Cook College’s decision to make process changes that we will submit removed consumer safeguards. We allege that this significantly reduced the College’s ability to detect misconduct by its sales agents and assess a consumer’s suitability or participation in the course they had been enrolled in.
We further allege that the removal of consumer safeguards increased the number of students that Captain Cook College enrolled and who remained enrolled, allowing the College to increase VET FEE-HELP payments from the Commonwealth,”The ACCC indicates that approximately 5,500 affected consumers whose enrolment was processed during the period from 7 September 2015 have VET FEE-HELP debt, totalling over $60 million. Around 98% of those 5,500 people failed to complete any part of the course in which they were enrolled. Around 86% never logged in to their online course.
The ACCC also alleges that the College made false or misleading representations, engaged in unconscionable conduct and failed to provide unsolicited consumer agreement protections in its dealings with four individual consumers. Further, Ian Cook (former Captain Cook College CEO), Site Group International Limited (Site, the parent company ) and Blake Wills (former COO of Site) were knowingly concerned in the systemic unconscionable conduct.
The ACCC is seeking pecuniary penalties, declarations, corrective notices, adverse publicity orders, finding of fact orders and orders requiring the implementation of a consumer law compliance program, costs and orders disqualifying Wills and Cook from managing corporations.
The ACCC notes
There is currently a legislative mechanism available under the Higher Education Support Act 2003 (Cth) (HESA) to cancel VET FEE-HELP debts of consumers enrolled from 1 January 2016 if they were affected by “unacceptable provider conduct”, and satisfy other legislative criteria. No such mechanism currently exists for consumers enrolled before this date. ...
On 20 September 2018, the Australian Government announced that it would introduce legislation to amend the HESA to allow for the cancellation of VET FEE-HELP debts of consumers that were affected by “inappropriate provider conduct”, including those who enrolled prior to 1 January 2016.Only a cynic would regard the proposed legislation as putting a bandaid on the horse's door after the livestock have run off with the money while regulators were asleep.