Colorado Technical University is the subject of two active federal whistleblower lawsuits in Denver alleging it defrauded the government of federal student aid, plus an open Department of Justice investigation into its recruiting and credit programs. If you attended CTU and took out federal loans, you may qualify for relief through the Sweet v. McMahon class-action settlement or by filing a borrower defense to repayment claim with the Department of Education. Both paths have hard deadlines and shifting rules, so timing matters.
The Intellipath Credit-Hour Case
The first pending case, United States ex rel. Fiorisce, LLC v. Colorado Technical University, Inc., was filed in 2021 in the U.S. District Court for the District of Colorado by a former CTU faculty member using a limited liability company to shield their identity.1Findlaw. United States Ex Rel. Fiorisce, LLC v. Colorado Technical University, Inc. The lawsuit says CTU took hundreds of millions of dollars in federal student aid it was not entitled to by lying about how much instruction its students received.
The complaint centers on CTU’s adaptive learning platform, Intellipath. The software assessed what students already knew and let them skip that material, but according to the lawsuit, the assessments were too simple and no replacement content filled the gap.2Higher Ed Dive. Whistleblower Lawsuit Against Colorado Technical University Federal rules require 135 hours of work for a 4.5-credit course. The complaint alleges some Intellipath courses were built with fewer than 20 hours of actual content, so students could not have met the federal threshold even if they finished everything.3Westword. Suit Says Colorado Tech Lied About Credit Hours to Get Millions in Aid In some instances, the complaint says, CTU reported more than 100 learning hours when students had actually spent fewer than 10 hours on the platform. When challenged, CTU allegedly inflated numbers further by using outlier students and counting multiple attempts at the same course as cumulative time.
The Department of Justice declined to intervene in February 2023, leaving the whistleblower to pursue the case independently.4U.S. Securities and Exchange Commission. Perdoceo Education Corporation SEC Filing In January 2024, the district court dismissed Perdoceo Education Corporation and American InterContinental University as defendants but allowed the claims against CTU itself to proceed.5Courthouse News Service. For-Profit University Asks 10th Circuit to Flunk Student Aid Fraud Whistleblower Case CTU appealed. On March 4, 2025, the Tenth Circuit dismissed the appeal for lack of jurisdiction, and the case remains active in district court.1Findlaw. United States Ex Rel. Fiorisce, LLC v. Colorado Technical University, Inc.
The Peters Recruiting Case
A second False Claims Act case was unsealed in late 2025 after the DOJ again declined to intervene. United States ex rel. Aidan K. Peters v. Perdoceo Education Corporation et al. was filed in 2023 by a former CTU online admissions advisor who worked at the school from June 2016 to November 2020. Peters filed an amended complaint on January 8, 2026, in the U.S. District Court for the District of Colorado.6Republic Report. US Ex Rel. Peters v. Perdoceo Amended Complaint
The complaint makes two main allegations. First, that CTU violated the federal Incentive Compensation Ban by tying admissions advisors’ promotions and pay to how many students they enrolled, a practice prohibited as a condition of receiving Title IV financial aid. Second, that recruiting was deceptive by design: management allegedly pressured recruiters to “enroll students by any means necessary,” trained them to target students who could not fully understand the enrollment forms, and instructed them to deliver an “Oscar-worthy performance” to close sign-ups.7Republic Report. Ex-Recruiter Sues For-Profit College Chain Perdoceo Alleging Systematic Fraud
Peters also alleges CTU made withdrawal difficult, using persistent phone calls and “student success coaches” to pressure students to stay. The complaint says CTU falsely certified compliance with federal rules to maintain Title IV eligibility, drawing hundreds of millions of dollars in aid it was not entitled to.7Republic Report. Ex-Recruiter Sues For-Profit College Chain Perdoceo Alleging Systematic Fraud Perdoceo has moved to dismiss the amended complaint. Briefing is complete and the motion is pending as of June 2026.8PACER Monitor. Peters v. Perdoceo Education Corporation Et Al
The DOJ Investigation
Separately, the Department of Justice issued a Civil Investigative Demand to CTU on September 7, 2024, under the False Claims Act. It seeks documents on how CTU compensates admissions staff and how the “Fast Track” credit program was described to prospective students, covering November 2017 to the present.4U.S. Securities and Exchange Commission. Perdoceo Education Corporation SEC Filing Perdoceo says in SEC filings that it is cooperating and has not recognized any liability.
Earlier Settlements That Still Matter
The current cases sit on top of a long record. In January 2019, Career Education Corporation (Perdoceo’s prior name) settled with 49 state attorneys general, forgiving about $493.7 million in institutional debt for roughly 179,500 former students and paying $5 million to the states. Eligibility was limited to students who attended a CEC school that closed before 2019, or whose last day at CTU or AIU was on or before December 31, 2013.9Office of the Georgia Attorney General. Carr Announces Settlement With For-Profit Education Company CEC denied the allegations.
In August 2019, the FTC settled charges that CEC used deceptive lead generators posing as military-affiliated to trick consumers into sharing personal information and to solicit registered Do-Not-Call numbers. CEC paid $30 million.10Federal Trade Commission. Operator of Colorado Technical University, American InterContinental University Will Pay $30 Million In June 2021, the FTC distributed nearly $30 million to more than 8,000 affected consumers, averaging over $3,700 each.11Federal Trade Commission. FTC Sends Nearly $30 Million in Refunds to People Tricked Into Enrolling in School Earlier settlements resolved False Claims Act allegations against sister school AIU in 2017 ($10 million), a New York attorney general action in 2013 ($10.25 million), and securities class actions in 2015 ($27.5 million) and 2008 ($4.9 million).12Veterans Education Success. Colorado Technical University, American InterContinental University, Trident University – Recent Actions and Concerns
Loan Relief Through Sweet v. McMahon
If you attended CTU, the most direct path to loan forgiveness may be the Sweet v. McMahon class-action settlement (formerly Sweet v. Cardona). CTU is on Exhibit C of the settlement, the list of schools whose former students receive a presumption of relief.13U.S. Department of Education / Federal Student Aid. Sweet v. Cardona Settlement School List
Under the settlement, post-class applicants from Exhibit C schools who did not receive a decision from the Department of Education by the court-ordered January 28, 2026, deadline are entitled to full settlement relief. That means discharge of qualifying loans, a refund of payments already made, and removal of the associated credit tradeline. The Department was required to issue eligibility notices for that relief by March 30, 2026.14Project on Predatory Student Lending. Sweet v. McMahon Class Members As of May 2025, the settlement had delivered relief to more than 271,000 borrowers across all covered schools. The Department has repeatedly tried to delay these deadlines, and in March 2026 the Ninth Circuit denied its most recent request.15Project on Predatory Student Lending. Sweet v. McMahon
Filing a Borrower Defense Claim
If you took out federal loans and believe CTU misled you about job placement, accreditation, whether your credits would transfer, program costs, or the quality of instruction, you can file a borrower defense to repayment application with the Department of Education. The standards, though, tightened in 2025.
The One Big Beautiful Bill Act, signed in July 2025, delayed the more borrower-friendly 2022 regulations until July 1, 2035, reverting to the stricter rules in place as of July 2020.16PR Newswire. CTU Borrowers 2026 Rule Changes Are Coming Which standard applies to you depends on when your loans were disbursed:
- Loans first disbursed before July 2017: you must assert a valid state-law basis such as fraud or breach of contract.
- Loans disbursed between July 2017 and July 2020: you must show substantial misrepresentation or breach of contract.
Claims are still being accepted, and the Department began sending notices to institutions on newer applications in March 2026. The whistleblower allegations about inflated credit hours and deceptive recruiting can help supply the factual basis for a claim, though how quickly the Department will adjudicate new applications is unclear.
Is CTU Still Open
Yes. CTU remains accredited by the Higher Learning Commission and eligible for federal student aid.17Colorado Technical University. About – Accreditations Its current program participation agreement with the Department of Education, renewed in February 2025, runs through June 2027.6Republic Report. US Ex Rel. Peters v. Perdoceo Amended Complaint The pending cases have not shut the school down, which matters for two reasons: former students seeking relief cannot rely on a closed-school discharge, and current students remain enrolled in a school actively defending federal fraud allegations.