28-05-2025
Thousands of student debts completely wiped as educator ordered to pay $30m over ‘unconscionable conduct'
The Federal Court has ordered an educator and its parent company to pay penalties of more than $30 million for misleading students.
Captain Cook College, a vocational college offering online diploma courses, was slammed for unfairly leaving 5500 vulnerable students with VET FEE-HELP debts totalling more than $60 million.
'The vast majority of them failed to complete any part of their course, and around 86 per cent never even logged in to their online course,' the Australian Competition and Consumer Commision (ACCC) said on Tuesday.
This was because the college removed consumer safeguards from its course enrolment and withdrawal processes, which affected vulnerable and disadvantaged consumers that were unsuitable for the enrolment.
That misconduct went down in 2015, a year after the college was acquired by parent company Site Group. A year later, the college stopped enrolling students and ended its core operations.
Competition and consumer regulator ACCC took action against the college in 2018.
The Government waived the thousands of unfair student debts, but ACCC chair Gina Cass-Gottlieb said the 'unconscionable conduct' did not just cost taxpayers.
'It also caused distress to the thousands of consumers enrolled in their courses who for many years were told they had significant debts,' she said.
The college had received tens of millions of dollars of federal government funding under the VET FEE-HELP scheme and saw a huge boost in revenue after the misconduct, ACCC said.
Captain Cook College was ordered by the court on Tuesday to pay $20 million for engaging in systemic unconscionable conduct.
It was also ordered to pay $750,000 for making false or misleading representations to students in connection with online diploma courses under the former VET FEE-HELP loan program, which was replaced by the by VET Student Loans program in 2017.
The court ordered Site Group to pay another $10 million in penalties, in addition to a $400,000 for the parent company's former COO, Blake Wills, who was 'knowingly concerned in Captain Cook College's system of unconscionable conduct', ACCC said.
Former CEO Ian Cook was already penalised in a 2020 settlement. He is disqualified from managing corporations for three years and he was ordered to pay $250,000 in penalties and contribute towards the ACCC's costs.
Site and several subsidiaries entered into voluntary administration in March this year.
