Two largest Christian universities in U.S. face record-setting federal fines

Unrelated cases involve alleged deception, alleged shortfalls in campus safety

The Grand Canyon University campus in Phoenix, Ariz. CGU publicity photo.

The two largest private Christian universities in the country have each been fined or threatened with record-setting fines from the U.S. Department of Education.

The Phoenix-based Grand Canyon University has been fined $37.7 million by the department’s Federal Student Aid office, and officials at Lynchburg, Va.’s Liberty University have said that the department is threatening to fine the school $37.5 million for failure to report alleged sexual assaults and other safety issues. Both would be the largest-ever fines of their types. Both schools have denied allegations and are or will be contesting the fines.

The department, which uses the acronym ED, claims that GCU misled students about what it would cost to earn a doctorate at the school. The potential fine at LU would be made under the Clery Act, which calls for transparency with school crime statistics; the ED has yet to file any action against the school, although alleged violations were discussed in a preliminary report that was leaked to news media.

According to the ED’s 2020-21 statistics, the latest available, GCU with 103,247 students and LU with 93,349 lead the nation in enrollment among Christian universities.¹ Both schools have large online enrollments.

There is no obvious indication that the the fines are connected with the religious character of either school, social-media discussion to the contrary. Both schools come under ED jurisdiction because their students receive federal student aid.

Here’s a quick look at the legal issues at play:

Grand Canyon University

The ED said that an investigation by its student aid office “found GCU lied to more than 7,500 former and current students about the cost of its doctoral programs over several years. GCU falsely advertised a lower cost than what 98% of students ended up paying to complete certain doctoral programs.”

The ED found that as far back as 2017 CGU was stating that its doctoral programs cost from $40,000 to $49,900 even though most graduates need “continuation courses” at added cost to complete their work. The ED said that for about 78 percent of the grad students, those courses and other expenses added from $10,000 to $12,000 in tuition costs.

The department acknowledged CGU’s defense that it disclosed those expenses to prospective students, but that those disclosures were in “fine print” and buried in “dense documents” and so were “much less prominent than the misrepresentations.”

In response, the university said it “categorically denies every accusation in the Department of Education’s statement and will take all measures necessary to defend itself from these false accusations.”

The university said its “disclosures related to continuation courses are more extensive than other universities, yet only GCU is being targeted by the Department.” It pointed out that “GCU’s disclosure is in full-size red type and placed above the Degree Program Calculator calculation in order to bring attention to it.”

The university also claimed that “this punitive action by the Department is part of a coordinated and targeted effort of the federal government that also involves the Federal Trade Commission and Department of Veterans Affairs” stemming from a dispute over the school’s nonprofit status.

Although the school did not accuse the ED of religious discrimination, university President Brian Mueller, in an interview with the Christian Post, suggested that there might be discrimination. “We don't know because they won't say, but a lot of people are assuming it is in part because we're teaching from a Christian worldview perspective,” he said.

Mueller also said: “The amount of the fine is absolutely ridiculous, but the point is, whether it was one dollar or $38 million, we're not paying a dime. We are the most transparent institution in the country.”

The university has until Nov. 20 to formally respond to the ED’s claims.

Liberty University

Allegations against LU were published last month in an article in the Washington Post, which said it had received a confidential, preliminary ED report.

The report centered on alleged failue to report wide-ranging safety problems, including a report of a rape by a former university president. No details of the alleged rape were given, and the ex-president was not named. The ED report said only that a rape had been reported to the school, not whether it was investigated or even if the report was credible. The Post was able to contact one former president, Jerry Falwell Jr., who said directly that the rape allegation was not about him.

The ED report also mentioned other alleged incidents of sexual assault, including at least one by an athlete. The preliminary report said that the university had shown a lack of administrative ability to keep the campus safe, pointing to incidents including gas leaks, the alleged failure to inform the campus of emergencies, and various crimes. The preliminary report also said that students were discouraged from reporting incidents, because when they did they “were frequently questioned about their own conduct that may have allegedly contributed.” For example, a university rule prohibits student alcohol consumption, so while reporting an incident they may have been asked whether they violated that rule.

Responding after the Post article, the university said it acknowledged in the spring of 2022 that there had been “historic gaps in compliance” with the Clery Act, and that it has been working with the ED “about reaching a timely, efficient, and fair resolution.”

Two weeks after LU published the statement, university President Dondi E. Costin said the ED was proposing to fine the school $37.5 million. “The most damaging element of this whole process is the fact that for the first time that any of us are aware, the Department of Education leaked a preliminary report while we are in the process of negotiating with the department about all the advancements that we've made. And so that's the biggest issue,” he told Fox News.

1. LU says on its website that it has a current enrollment of over 130,000, which would make it larger than GCU. However, it is not clear if that number was calculated in the same way as the numbers listed by the ED.