Sydney – In a landmark case in the Federal Court, the Australian Competition and Consumer Commission (ACCC) will allege Unique International College Pty Ltd targeted vulnerable consumers in New South Wales and misled them about government-funded courses using the HECS-style VET FEE HELP loan system.
Unique International College Pty Ltd reaped $57 million of VET FEE HELP government funding in 2014-2015.
A joint investigation by the Australian Competition and Consumer Commission (ACCC) and the NSW Fair Trading Department will allege that the Unique International College in Sydney’s western suburbs engaged in “unconscionable conduct” in pushing disadvantaged students into signing up for courses worth up to $25,000.
The company’s founder and CEO, Amarjit Khela, is a prominent member of Sydney’s Indian and Nepalese community, hosting beauty pageants for Mr & Miss Teen Nepal Australia, Bollywood film screenings and disaster relief charity events.
The tactics from the Granville college netted the company a profit of more than $11 million in six months last year after it received up to $47 million in taxpayer funding between January and December 2014. The ACCC will ask the court to make the college repay the $57 million it has received to date in Commonwealth government funding.
In one instance, a 19-year-old disabled man who was under the full-time care of his grandmother was allegedly signed up for thousands of dollars in Commonwealth debt despite not being informed of anything about the course or the private college that was providing it 400 kilometres from his home in Wagga Wagga.
The ACCC’s statement of claim filed in the Federal Court on Tuesday reveals the students that were allegedly targeted by the college were often from Aboriginal housing missions in the state’s most disadvantaged areas such as Walgett, Boggabilla and Bourke.
Sales agents would allegedly enter their houses, enticing students and their families with free laptops and would then ask the students to sign a series of forms that they could not understand.
Their signatures would put them between $10,000 and $25,000 in Commonwealth VET-FEE Help debt.
Students were allegedly told nothing at all about the courses or that the courses in salon management, marketing and business management were free as long as they never earned more than $50,000 a year. Only 2.4 per cent of Unique’s students graduated between July and December 2014, the ACCC alleges.
In another case cited by the ACCC, a 66-year-old Indigenous woman who could not read or write when she left school was allegedly targeted by Unique College’s sales agents to complete an online course despite the fact she had never had an internet connection, a laptop, email, or any reasonable means by which to pay the course fees.
According to the college’s website it maintains a relationship with the Australian Catholic University.
A spokeswoman for the university said ACU’s agreement with Unique International College ceased in April this year.
Through his website Mr Khela has advocated for his college’s “academic excellence,” and emphasised maintaining high ethical standards for sales agents.
In a statement, the college said it would strenuously defend the action being brought by the ACCC. “We have operated within the policy and regulatory framework set out by the Commonwealth government,” the statement read.
The chairman of the ACCC, Rod Sims, said that the college was targeted because the ACCC believed it was one of the worst offenders in the country.
“This was very bad behaviour, this is a very strong charge of unconscionable conduct that we are going for,” he said.
Mr Sims said that there were 10 colleges currently under investigation and that he hoped to have two of them before the courts before the end of the year.
NSW Fair Trading Commissioner Rod Stowe said potential students being targeted by private colleges should be reminded that the VET FEE-HELP loan incurred by students is a lifetime debt.
“It is important that colleges are upfront with prospective students and clearly explain the price of the courses they are offering. Consumers need to be able to fully understand what they are agreeing to before making a decision to sign up to a course,” he said.
Unique International College is due before the Federal Court on November 24.