What defines a scam?

Question

There is a question on Y!A at the moment about one of the UK's terrible universities.  One of the ones that should be avoided unless someone wants to end up working in minimum wage hospitality jobs after spending 3 years and getting into debt.

However if you read through the university information it looks wonderful.  However it leaves out all the important things that would help you decide if the courses were for you.  Important information like most of the jobs would be freelance but you won't get one because  you studied at this university and people get work but not what sort of work etc.

The entry requirements are very low so they are trying get people who aren't clever enough to ask the right questions.  It is the kind of university that could do with being closed.

I feel it is bordering on a scam and it is not a nice scam because it targets people who are not very smart.

Sam Spayed · Accepted Answer

If you want to get technical about it, there must be:
1. a false representation of fact made to an innocent party, 	
2. known to be false by the party making the false representation,
3. with an intent to deceive the innocent party.
4. a reasonable reliance by the innocent party on the false representation of fact	
5. actual loss suffered by the innocent party

So it's really difficult for an accredited educational institute to be convicted of fraud. Facts that are misleading, but still technically true, probably won't be held to meet the first element.

For example, a law school tell admitted applicants, to induce them to attend the school, that 95% of its graduates are employed within four months of graduation. The truth is, only 5% hold jobs with law firms, and the other 90% could not find law jobs and went to work as waiters and retail shop assistants because their student loans came due. Is it fraud? The law school only said "employed" so while it may have intended to deceive, it didn't actually make a false representation.

Even the worst "diploma mill" type of business typically can't convicted of fraud against the students, since it can't be said that they "reasonably" relied on the false representation: every reasonable person should know that they can't mail a real university $300 and a list of "life experiences" and earn a PhD. diploma mills are a conspiracy between the students and schools; the victims are the employers.

The sorts of actions that get educational institutions accused of fraud in the US (I'm not sure of convictions, although many have settled) include: enrolling students in a course of study for a career in which they could never qualify to work (for example, someone convicted of a drug-related felony in a pharmacy technician program); enrolling students for a course no longer offered at the university; enrolling students in career programs for jobs that only require a high school diploma (while not providing a greater job acceptance rate for graduates), etc.

What defines a scam?

1 Answer