In 2015, Tamara, an unemployed single mum, signed up to do a course through the now-disgraced Phoenix Institute.
A sales person had come to her house in Broadmeadows and offered her a free laptop. “They don’t take no for an answer,” she says in the new six-part SBS documentary, Struggle Street series two. “They’re quite forceful. I remember dealing with him a year ago saying to him ‘please don’t come to my house without ringing me first’. He would just turn up whenever he felt like it.”
Tamara tried, unsuccessfully, to withdraw from the course. She left with a $60,000 debt for a course she never started.
“Our lawyers have assisted dozens of Victorians who were ripped off during the VET industry scandals.”
In November 2015, the ACCC commenced proceedings against Phoenix Institute, alleging that between January and October 2015, Phoenix enrolled more than 9,000 students in 17,000 courses and was paid in excess of $100 million by the Commonwealth for those enrolments. The ACCC accused Phoenix of “unconscionable” conduct in the marketing and selling of VET FEE-HELP-funded courses.
Tamara was one of hundreds, perhaps thousands, of people affected by the VET FEE-HELP loans scheme scandal.
“Our lawyers have assisted dozens of Victorians who were ripped off during the VET industry scandals,” says Katherine Temple, Senior Policy Officer at the Consumer Action Law Centre. “However, we only saw the tip of the iceberg when it came to complaints."
Many, like Tamara, were targeted by door-to-door sellers offering free computers and other inducements. “We saw rampant and inappropriate selling of VET courses which had a huge impact on vulnerable and low-income Australians, often young job seekers. There were issues with poor quality courses, high-pressure sales tactics, unfair contracts and excessive course fees. Thankfully, the recent reforms to the sector have stamped out most of this bad behaviour,” says Temple.
“We also saw telemarketers targeting job seekers, with unqualified salespeople masquerading as ‘career counsellors’. Some people were told that their student loan would not have to be repaid, or that there were no fees for their course.”
"Thankfully, the recent reforms to the sector have stamped out most of this bad behaviour."
In a separate VET FEE-HELP loan situation, Doaa Ghattas, from Rowville in Melbourne’s south-east, was working as a graphic designer at a trophy factory when she enrolled in an online course in HR management in March 2016. She was told that the six-month course would cost $6,000, which would be covered by a FEE-HELP loan.
She encountered problems from the start. She was sent a link to the wrong course and it took six weeks to receive the correct link. Then, three weeks into her studies, she was told that the course provider had changed to Asia Pacific Training Institute, and she would receive a link to the new course.
It was completely different, she says. She was unhappy with both the course content and its management, and requested to withdraw from the course. She was sent yet another link, which clicked through to a message that said she would receive a notification email – which of course never arrived.
Ghattas says Asia Pacific Training Institute acknowledged her withdrawal from the course in communication during this period. “From the emails, you can see that they knew I withdrew from the course,” she says. She didn’t hear anything else until tax time, when her accountant asked her about the large VET FEE-HELP debt she owed the ATO.
Surprised, she logged onto MyGov and discovered that Asia Pacific Training Institute had charged her over $6,000 on three occasions – two payments in 2016-17, and one in the previous financial year. With interest, she now owed the ATO $25,000.
Ghattas contacted the Victorian Education Department, who referred her to Consumer Affairs, who told her to get in touch with the course provider. But Asia Pacific Training Institute's approval as a VET provider had been revoked for non-compliance with the VET Quality Framework.
According to a report published in The Age, the provider “received $49 million in VET FEE HELP loans for 3,000 students in 2015. It reported a unit pass rate of 40 per cent that year.”
The cancellation of its registration was announced in April 2017, and came into the effect in May – the same month the provider charged the last $6,000 from Ghattas. “Before they closed, they started getting money from the students quickly before their licence was cancelled,” she says.
“If you’re unhappy with their response or they have closed down then you should make a complaint to the Commonwealth Ombudsman.”
She was then directed to the Commonwealth Ombudsman, who asked her to submit a formal complaint. Her submission is currently being reviewed and she has no idea what will happen next – if the debt will be wiped or if she will have to repay it. “No one can tell you anything. When you contact them, they say ‘we can’t give you any advice until you submit a formal complaint’,” she says. Whatever the outcome, it’s clear she’s not alone. “The person from the Ombudsman said that he has lots of complaints about Asia Pacific Training Institute,” she says.
Ghattas, who is trying to set up a graphic design business, can’t afford to lose $3,000 to $4,000 a year in repayments to a course she never completed. She and her husband, a bus driver, have two sons to support. One is studying at Charles Sturt University in Wagga Wagga and the other is a high school. “It’s $25,000 – it’s lots of money to lose,” she says. “I have a home loan and a car I’m still paying for.”
Temple says anyone affected by VET FEE-HELP loan concerns may be able to get their student loan debt cancelled if their training provider engaged in ‘unacceptable conduct’. “For example, if you were offered a laptop or other inducement to enrol in a course or if you were told that the loan would not have to be repaid.”
You should try to resolve your complaint with the training provider directly, she says. “If you’re unhappy with their response or they have closed down then you should make a complaint to the Commonwealth Ombudsman.”
If you have an issue or complaint relating to a VET FEE-HELP OR VET Student Loan contact the Commonwealth Ombudsman on their website or call 1300 362 072.
If you or someone you know are in need of support, contact Lifeline on 13 11 14.
All six episodes of Struggle Street series two are available to view on SBS On Demand.
Struggle Street series two is produced by KEO Films with funding support from Screen Australia and Film Victoria.