Provides students enrolled in certain career programs with consumer protections from fraudulent and misleading claims and practices.

A2091

ASSEMBLY, No. 2091

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Assemblywoman LINDA S. CARTER

District 22 (Somerset and Union)

Assemblywoman VERLINA REYNOLDS-JACKSON

District 15 (Hunterdon and Mercer)

SYNOPSIS

���� Provides students enrolled in certain career programs
with consumer protections from fraudulent and misleading claims and practices.

CURRENT VERSION OF TEXT

���� Introduced Pending Technical Review by Legislative
Counsel.

��

An Act
concerning career programs of study and supplementing
P.L.1960,
c.39 (C.56:8-1 et seq.).

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.��� As used in this act:

���� �Career program of study�
means a program that develops occupation-specific knowledge and technical skill
proficiency that culminates in the attainment of a license or certificate for a
specific occupation, or is represented by the program as preparing students for
employment in a specific occupation.�

���� �Cost of attendance� means the
tuition and fees charged for a program, plus the costs for room and board while
enrolled in a program, and the costs for any transportation, books, or other
supplies required for participation in a program.�

���� �Covered school� or �school�
means a nonpublic postsecondary educational institution that offers one or more
career programs of study or a private career school as that term is defined by
section 14 of P.L.2021, c.27 (C.34:15C-10.3).� Covered schools do not include
public or independent institutions of higher education.�

���� �False or misleading
statement� means any false or unsubstantiated statement, misrepresentation, or
knowing omission of any material fact, which has the tendency or capacity to
mislead a student, prospective student, or other individual.�

���� �Lending institution� means
any private entity that itself, or through an affiliate, engages in the
business of making loans to students, parents, or others, for the purpose of
financing postsecondary education or training expenses, or that securitizes such
loans, or any private entity, or association of entities, that guarantees such
loans.�

���� �Placement rate� means the
percentage of program graduates, or of students who completed a program, who
obtained employment in their field of study within an established timeframe.

���� �Preferred lender� means any
lending institution that a school endorses, promotes, chooses, or assigns
preferential status to, by posting a lending institution�s name or loan
product�s name in information mailings or brochures or any other document provided
to students, prospective students, or their parents, or arranging or otherwise
facilitating the origination of loans from the lending institution.

���� 2.� It shall be an unlawful
practice and a violation of P.L.1960, c.39 (C.56:8-1 et seq.) for a covered
school to:

���� a. initiate communication with
a prospective student prior to enrollment on more than two occasions in a seven
day period;

���� b. engage in misleading or
deceptive advertising practices, including, but not limited to, using or
causing to be used:

���� (1) advertisements that
conceal or fail to disclose the name of the school; or

���� (2) advertisements, whether
printed or electronic, to solicit prospective students using a false or
misleading statement that causes a prospective student or other person to
falsely believe that employment is being offered;

���� c.� enroll a student in a
program when the school knows, or reasonably should know, that the student will
not meet the� educational, training, licensure, or other requirements for
employment in the industry for which the school claims to prepare students;

���� d. recommend specific lending
institutions to prospective or current students while failing to disclose that
the lending institution is:

���� (1) is affiliated with the
school or its corporate parent or subsidiaries; or

���� (2) is providing to the school
directly or indirectly, something of value in the form of payment or in-kind
service in exchange for any advantage or consideration provided to the lending
institution relating to educational loan activities;

���� e. discourage prospective or
current students from choosing a lender solely on the basis of that lending
institution not being on the school�s preferred lender list;

���� f.� permit or authorize a
lending institution, in conjunction with discussing loan options with
prospective or current students, to identify the lending institution�s
employees or agents as employees or agents of the school;

���� g. represent or imply in
advertising or otherwise that persons employed in a given occupation will earn
a stated salary or income or that persons completing a program will earn the
stated salary or income unless:

���� (1) the stated salary or
income is equal to or less than the average entry level salary of persons
employed in the occupation in the State, as determined by the Department of
Labor and Workforce Development;

���� (2) the advertisement or
representation states clearly and conspicuously any limitations, conditions, or
other requirements that are required to be met to qualify for the stated salary
or income; and

���� (3) the advertisement or
representation states clearly and conspicuously that no guarantee is made that
a person who purchases the advertised services will obtain a job or will earn
the stated salary or income, unless the guarantee is offered directly by the
school; or

���� h. make any false or
misleading statement regarding:

���� (1) actual or probable
earnings of the school�s former students in general or in any job or
occupation;

���� (2) the accreditation of the
school, a program at the school, or the number and qualifications of the
faculty and staff employed by the school;

���� (3) placement rates or
placement services;

���� (4) opportunities to join any
job or occupation, or the likelihood of employment in any job or occupation;

���� (5) the requirements for
successfully completing the program, grounds for termination from the program,
the transferability of credits earned at other schools into the program, the
transferability of credits earned at the program to other schools;

���� (6) limited-time admissions
offers;

���� (7) the nature or character of
classroom instruction, including disclosures over the extent to which
instruction is provided by means other than in-person;

���� (8) the size, location,
condition of school facilities or equipment, and as appropriate, their
applicability to the education or training being offered;

���� (9) the availability,
frequency, and applicability of the courses and programs to the stated
employment objectives of the program;

���� (10) any prerequisites
established for enrollment in any course or program;

���� (11) testimonials or
endorsements by current or former students, employers or industry
representatives, schools or educational entities, or others;

���� (12) the award of any
certificate, diploma, degree, or other document upon completion of the program,
and whether the document is authorized by any government, industry, or other
agency;

���� (13) the costs of attendance,
the availability of scholarships and financial assistance, the right to refuse
any loan offer or other offer of financial assistance, and the refund policy of
the school;

���� (14) the availability of any
tutorial or specialized instruction, guidance, and counseling or other
supplementary assistance from the school; and

���� (15) the education level,
training, experience, or other material requirements for certification,
employment or licensure in the occupation, or for acceptance to a required
apprenticeship to which the program is represented to lead.�

���� 3. a. It shall be an unlawful
practice and a violation of P.L.1960, c.39 (C.56:8-1 et seq.) for a covered
school to fail to post on its website, and to fail to disclose to prospective
students at least 72 hours prior to entering into an enrollment agreement for a
program, on a form to be signed by a representative of the school and by the
student, the following information:

���� (1) the program�s cost of
attendance;

���� (2) the average length of time
to complete the program;

���� (3) completion rates of the
previous three cohorts of students;

���� (4) the percentage of program
completers from the last three years who have secured full-time employment in a
position for which the program represents to provide education or training; and

���� (5) the requirements for
certification, employment, or licensure in the occupation for which the program
represents to provide education or training.

���� b.� A covered school shall
disclose the information required pursuant to this section at least annually to
each student enrolled at the school, on a form to be signed by a representative
of the school and the student.�

���� 4.� It shall be an unlawful
practice and a violation of P.L.1960, c.39 (C.56:8-1 et seq.) for any covered
school to compensate an employee or contractor involved in the recruitment,
enrollment, admissions, or sales of educational materials to students on the
basis of commission, bonuses, and other direct forms of compensation based on
success in securing enrollments.���

���� 5.� The Attorney General, in
consultation with the Secretary of Higher Education and the Commissioner of
Labor and Workforce Development, shall adopt, pursuant to the
"Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.),
rules and regulations necessary to implement the provisions of this act.�

���� 6. This act shall take effect
on the first day of the 12th month next following the date of enactment.�

STATEMENT

����
This bill provides students
enrolled in certain career programs with consumer protections from fraudulent
and misleading claims and practices.� The bill�s provisions apply to nonpublic
postsecondary educational institutions that offer one or more career programs
of study and private career schools.� The bill does not apply to public or
independent institutions of higher education.�

���� Under the provisions of this
bill, it would be an unlawful practice under the consumer fraud act for certain
schools offering career programs of study to:

�

initiate
communication with a prospective student prior to enrollment on more than two
occasions in a seven day period;

�

engage in
certain misleading or deceptive advertising practices;

�

enroll a
student in a program when the school knows, or reasonably should know, that the
student will not meet the� requirements for employment in the industry which
the school claims to prepare students;

�

recommend
specific lending institutions to prospective or current students while failing
to disclose certain relationships that benefit the institution or school;

�

discourage
prospective or current students from choosing a lender solely on the basis of
that lending institution not being on the school�s preferred lender list;

�

permit or
authorize a lending institution to identify the lending institution�s employees
or agents as employees or agents of the school;

�

represent or
imply in advertising or otherwise that persons employed in a given occupation
will earn a stated salary or income or that persons completing a program will
earn the stated salary or income; or

�

make any false
or misleading statement regarding school qualifications, staff, or assets,
costs or financial aid awards, student outcomes, industry opportunities, or
other specified areas relating to the program experience, prospects, or
obligations of students.

���� The bill further provides that
it would be an unlawful practice under the consumer fraud act for a covered
school to fail to post on its website, and to fail to disclose to prospective
students at least 72 hours prior to entering into an enrollment agreement for a
program, on a form to be signed by a representative of the school and by the
student, the following information:

�

the program�s
cost of attendance;

�

the average
length of time to complete the program;

�

completion
rates of the previous three cohorts of students;

�

the percentage
of program completers from the last three years who have secured full-time
employment in a position for which the program represents to provide education
or training; and

�

the
requirements for certification, employment, or licensure in the occupation for
which the program represents to provide education or training.

The bill requires a covered school
to disclose this information at least annually to each student enrolled at the
school, on a form to be signed by a representative of the school and the
student.�

���� Finally, the bill provides
that it would be an unlawful practice under the consumer fraud act for a
covered school to compensate an employee or contractor involved in the
recruitment, enrollment, admissions, or sales of educational materials to
students on the basis of commission, bonuses, and other direct forms of
compensation based on success in securing enrollments.� An unlawful practice is
punishable by a monetary penalty of not more than $10,000 for a first offense
and not more than $20,000 for any subsequent offense.� In addition, violations
may result in cease and desist orders issued by the Attorney General, the
assessment of punitive damages, and the awarding of treble damages and costs to
the injured party.���

���� The bill directs the Attorney
General, in consultation with the Secretary of Higher Education and the
Commissioner of Labor and Workforce Development to develop and adopt rules and
regulations necessary to implement the bill�s provisions.