Former CEO of Captain Cook College fined, barred from managing corporations over ‘unconscionable’ conduct

A disgraced online diploma college made two big changes that saw it rake in millions — before the consumer watchdog caught up with them.

Captain Cook College engaged in unconsciable conduct, the Federal Court has found. Photo: Mike Knott / NewsMail

The former CEO of a disgraced online diploma college that used dodgy practices to reel in thousands of unsuitable students who never logged into their courses has been fined and barred from managing corporations for three years.

Ian Cook was at the helm of Captain Cook College in 2015 when it drastically changed two policies to increase enrolment and stop students withdrawing from courses before incurring a loan debt.

Students were charged between $13,000 and $20,000 for courses such as business, project management and IT, which was paid to Captain Cook College by the Commonwealth under the VET FEE-HELP loan scheme.

Under the scheme students were left owing the Commonwealth the cost of the course and a 20 per cent loan fee.

Captain Cook College saw enrolments rocket from 1300 across 10 months to about 7000 between September 7 and December 18, 2015, when the changes were in place.

In this three-and-a-half month period the college claimed $54 million in VET FEE-HELP revenue, against $7.4 million in the 10 months prior.

But many of the students they signed up were not literate nor numerate enough to complete the course, or did not have access to necessary equipment like a computer.

The enrolment boon ceased in December when the Commonwealth imposed a $16.8 million loan cap for 2016 that would be met and exceeded by existing students.

The college enrolled thousands of unsuitable students after removing consumer safeguards from enrolment and withdrawal processes in 2015. Picture: Jonathan Ng

The Australian Competition and Consumer Commission brought action against the college, Mr Cook, the college’s parent company Site Group and Site Group’s former chief operating officer Blake Wills in 2018.

In June 2020, with a hearing for all four pending, Mr Cook admitted he knew about and took part in the unconscionable conduct.

As a result he was not part of the hearing that concluded on Friday when the Federal Court ruled the college had engaged in unconscionable conduct and Site Group and Mr Wills were aware of it and involved in it.

On Monday, Federal Court Justice Robert Bromwich handed down a separate judgment in which Mr Cook was slapped with a $250,000 penalty, disqualified from managing corporations for three years and ordered to pay $250,000 towards the ACCC’s costs.

Rod Sims, chair of the consumer watchdog, said on Friday the college had enrolled “vulnerable and disadvantaged” students in courses they were unlikely to ever use or even finish.

In fact, Mr Sims said, more than 90 per cent did not complete any part of the online course and 86 per cent never even logged in.

One change made by the college was ceasing to call students after they had enrolled to check they were suitable for the course.

Instead, the recruiter or marketer who signed them up would call the college, the new student by their side as they went through a yes/no script with a college staff member.

The other change involved ditching a process in which students who were not engaging with their course were automatically withdrawn before they incurred a loan debt.

According to agreed facts between the ACCC and Mr Cook, outlined in Justice Bromwich’s judgment, Mr Cook believed the changes were lawful and simply brought Captain Cook College’s practices in line with its competitors.

“There is no allegation of dishonesty on the part of (Mr) Cook. (Mr) Cook made no personal financial gain from the conduct,” the agreed facts read.

Mr Cook now works in the public sector.

All students enrolled in the relevant period have had their debts waived by the Commonwealth.

Originally published as Former CEO of Captain Cook College fined, barred from managing corporations over ‘unconscionable’ conduct