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The owner of University of Phoenix is halting mandatory arbitration with students who claim to have been deceived or defrauded by the school.

Apollo Education, which operates University of Phoenix and Western International University, announced that it will no longer include mandatory arbitration clauses in its arbitration agreements effective July1.

Previously, concerned students and graduates at the schools found that their recourse against Apollo was arbitration -- a private, out-of-court system for dispute resolution that often is more expensive and tilted heavily in favor of major corporations.

Arbitration clauses have received increasing scrutiny by the U.S. Department of Education and the federal Consumer Financial Protection Bureau
 
 
University of Phoenix has experienced steep enrollment declines, dropping from a height of 460,000 students at its campuses five years ago to 213,000 now, according to statistics released by its parent company, Apollo Education Corp.
CNN Money has stated that "Apollo's fast fall is another sign of the decline in for-profit education . . . Once a cash cow industry, for-profit education companies have struggled to overcome criticism of the quality of its education and the costs.  They're the sore spot in the national debate about value of higher education."