§ 94897. — 94897. (Amended by Stats. 2025, Ch. 592, Sec. 40.)

California § 94897.

• Jurisdiction: California
• Code EDC: Education Code - EDC
• Div.: 10.
• Title 3.: DIVISION 10. PRIVATE POSTSECONDARY AND HIGHER EDUCATION INSTITUTIONS
• Part 59.: PART 59. PRIVATE POSTSECONDARY AND HIGHER EDUCATION INSTITUTIONS
• Ch. 8.: CHAPTER 8. Private Postsecondary Institutions
• Art. 8.: ARTICLE 8. Fair Business Practices

Text

An institution shall not do any of the following:
(a)
Use, or allow the use of, any reproduction or facsimile of the Great Seal of the State of California on a diploma.
(b)
Promise or guarantee employment, or otherwise overstate the availability of jobs upon graduation.
(c)
Advertise concerning job availability, degree of skill, or length of time required to learn a trade or skill unless the information is accurate and not misleading.
(d)
Advertise, or indicate in promotional material, without including the fact that the
educational programs are delivered by means of distance education if the educational programs are so delivered.
(e)
Advertise, or indicate in promotional material, that the institution is accredited, unless the institution has been accredited by an accrediting agency.
(f)
Solicit students for enrollment by causing an advertisement to be published in “help wanted” columns in a magazine, newspaper, or publication, or use “blind” advertising that fails to identify the institution.
(g)
Offer to compensate a student to act as an agent of the institution with regard to the solicitation, referral, or recruitment of any person for enrollment in the institution, except that an institution may award a token gift to a
student for referring an individual, provided that the gift is not in the form of money, no more than one gift is provided annually to a student, and the gift’s cost is not more than one hundred dollars ($100).
(h)
Pay any consideration to a person to induce that person to sign an enrollment agreement for an educational program.
(i)
Use a name in any manner improperly implying any of the following:
(1)
The institution is affiliated with any government agency, public or private corporation, agency, or association if it is not, in fact, thus affiliated.
(2)
The institution is a public institution.
(3)
The institution grants degrees, if the institution does not grant degrees.
(j)
In any manner make an untrue or misleading change in, or untrue or misleading statement related to: a test score, grade or record of grades, attendance record, record indicating student completion, placement, employment, salaries, or financial information; a financial report filed with the bureau; information or records relating to the student’s eligibility for student financial aid at the institution; or any other record or document required by this chapter or by the bureau.
(k)
Willfully falsify, destroy, or conceal any document of record while that document of record is required to be maintained by this chapter.
(
l
)
Use the terms “approval,” “approved,” “approval to operate,” or “approved to operate” without stating clearly and conspicuously that approval to operate means compliance with state standards as set forth in this chapter. An institution may not state or imply either of the following:
(1)
The institution or its educational programs are endorsed or recommended by the state or by the bureau.
(2)
The approval to operate indicates that the institution exceeds minimum state standards as set forth in this chapter.
(m)
Direct any individual to do any of the following:
(1)
Perform an act that violates this chapter.
(2)
Refrain from reporting unlawful conduct to the bureau or another government agency.
(3)
Engage in any unfair act to persuade a student not to complain to the bureau or another government agency.
(n)
Compensate an employee involved in recruitment, enrollment, admissions, student attendance, or sales of educational materials to students on the basis of a commission, commission draw, bonus, quota, or other similar method related to the recruitment, enrollment, admissions, student attendance, or sales of educational materials to students, except as provided in paragraph (1) or (2):
(1)
If the educational program is scheduled to be completed in 90 days or less, the institution shall pay compensation related to a
particular student only if that student completes the educational program.
(2)
For institutions participating in the federal student financial aid programs, this subdivision shall not prevent the payment of compensation to those involved in recruitment, admissions, or the award of financial aid if those payments are in conformity with federal regulations governing an institution’s participation in the federal student financial aid programs.
(o)
Require a prospective student to provide personal contact information in order to obtain, from the institution’s internet website, educational program information that is required to be contained in the school catalog or any information required pursuant to the consumer information requirements of Title IV of the federal Higher Education
Act of 1965, and any amendments thereto.
(p)
Offer an associate, baccalaureate, master’s, or doctoral degree without disclosing to prospective students before enrollment whether the institution or the degree program is unaccredited and any known limitation of the degree, including, but not limited to, all of the following:
(1)
Whether a graduate of the degree program will be eligible to sit for the applicable licensure exam in California and other states.
(2)
A statement that reads: “A degree program that is unaccredited or a degree from an unaccredited institution is not recognized for some employment positions, including, but not limited to, positions with the State of California.”
(3)
That a student enrolled in an unaccredited institution is not eligible for federal financial aid programs.
(q)
In any manner commit fraud against, or make a material untrue or misleading statement to, a student or prospective student under the institution’s authority or the pretense or appearance of the institution’s authority.
(r)
Charge or collect any payment for institutional charges that are not authorized by an executed enrollment agreement.
(s)
Violate Section 1788.93 of the Civil Code.
(t)
Require a prospective, current, or former student or employee to sign a nondisclosure agreement pertaining
to their relationship to, or experience with, the institution, except that an institution may use a nondisclosure agreement to protect the institution’s intellectual property and trade secrets. Any nondisclosure agreement in violation of this section is void and not enforceable at law or in equity.
(u)
Fail to maintain policies related to compliance with this chapter or adhere to the institution’s stated policies.

Legislative History

Amended by Stats. 2025, Ch. 592, Sec. 40. (SB 861) Effective January 1, 2026. Repealed as of January 1, 2027, pursuant to Section 94950.