ACCC expected to lay charges against 10 unethical private training colleges to set example

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Josie Taylor and Alison Branley, ABC News, 30 April, 2015,  http://ab.co/1JCWvYL

The Australian Competition Consumer Commission (ACCC) says it expects to lay charges against unethical private training colleges after one of its biggest investigations.

ACCC chairman Rod Sims told the ABC the watchdog’s ongoing investigation into 10 unnamed private training providers around the country was at an advanced stage.

“We will end up taking some people to court to really send a signal about what’s acceptable and what’s not,” Mr Sims said.

“We’re really concerned about what looks like, what could be, really appalling behaviour.”

Mr Sims said the ACCC was investigating misleading and unconscionable conduct including vulnerable people being signed up without their knowledge, offered cash and free tablets as inducements, the deliberate targeting of low income people, and companies spruiking outside Centrelink and community centres.

“I think we know enough to know there’s serious problems,” Mr Sims said.

“The targeting of low income people … probably not well suited to doing these sorts of courses, that indicates a widespread problem. That’s pretty bad.”

The Federal Government recently changed laws regulating changes to legislation governing private training providers, banning inducements such as free tablets.

“Given the potential rorting of taxpayers’ money, given the taking advantage of very vulnerable consumers, we’ve judged this to be a high-profile matter,” Mr Sims said.

“We rarely have 10 investigations on anything at once, this is a rare case. We judge it as very important.”

Training colleges focus of fair trading, ACCC joint taskforce after complaints vulnerable consumers targeted for courses

Danuta Kozaki, ABC News, 23 Mar 2015, http://ab.co/1FzIFns

Education and training colleges which are roping in unsuspecting consumers will be the focus of a joint federal and New South Wales taskforce.

NSW Fair Trading Minister Mathew Mason-Cox said it was prompted to form the taskforce, in conjunction with the Australian Competition and Consumer Commission (ACCC), after it received numerous complaints from vulnerable groups.

He said people from remote Indigenous communities and people from non-English speaking backgrounds were being signed up for courses and saddled with major debts.

“[Colleges are] using incentives to actually attract people to sign up for courses which often are courses that they are not able to complete,” he said.

“Indeed they might not even be literate and [are being used] as a means for those training organisations to access funds from the Commonwealth Government.”

Chief executive of the peak body for registered training organisations, the Australian Council for Private Education and Training (ACPET), Rod Camm welcomed the taskforce.

“There’s certainly been reports of inappropriate recruitment of students and I think the protection of students has to be at the forefront of all our strategies,” he said.

Mr Camm said he could not specify the number of complaints.

Previously, there were a number of public reports about inappropriate inducements such as laptops to target students.

“That does not necessarily set that student up for a lifelong journey in terms of education,” Mr Camm said.

“We want them to be picking the right course for them and the right strategy for them.”

Reports practices ‘targeting lower socio-economic areas’

Mr Camm said he had also heard reports of colleges targeting would-be students based on where they lived.

“We have also heard of various brokers and agents targeting lower socio-economic areas with these inducements with the view to maximising student recruitment,” he said.

“If students are being unfairly enrolled and [are] therefore incurring debts which they are not going to realise with a quality education, I would have thought it is a breach of consumer protection laws.”

Mr Mason-Cox said he hoped some of the strong-arm tactics being used by some registered training organisations would be brought to account.

“It’s an appalling practice and it saddles these people with debt for years and years and they’ve got no prospect of doing the course let alone actually making a contribution to paying off that debt,” he said.

Mr Camm said the matter should have been dealt with earlier.

“I am encouraged they are engaging in the debate, but these criticisms have been around for a little while now. I certainly hope they are able to focus on the investigation and move it on as promptly as they can,” he said.

He said a new national regulator was introduced in 2012 and a new code of ethics was launched last week.

“We want to make sure ACPET members are stepping higher in terms of quality,” Mr Camm said.

“The key is, for any engagement and then enrolment of a student [there] has to be a genuine assessment of their abilities and their interest in the course.

“If the provider puts them into a course that suits them, it can set them up for either employment or further education.”

‘I think the education incentive is the right one’

Mr Camm rejected claims that government incentives always lead to abuse.

“I think whenever there is government funding there is always a risk of inappropriate market behaviour but I still think the education incentive is the right one,” he said.

“It is about making sure there is integrity in the sector,” he said.

In a written statement, the ACCC said it was working jointly with NSW Fair Trading and other Australian consumer law regulators to understand and address conduct that impacts on consumers, particularly the vulnerable, in the training and education sector.

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