What corporatized higher education is really like

Popular Resistance - Controversial for-profit giant Corinthian Colleges said it is closing the doors of its remaining 28 schools, capping the year-long collapse of one of the country’s largest career college chains.

The closure will leave some 16,000 students without certificates or degrees but with a good chance of having their federal student loans forgiven. Corinthian said it is working with other schools to find a home for its displaced student body, but those efforts depend on the cooperation of the institutions and the Education Department.

Corinthian, which runs Everest Institute, Wyotech and Heald College, has spent the last year in a downward spiral. Amid allegations of falsified job placement records and graduation rates, the Education Department cut off the schools’ access to federal aid last June, forcing Corinthian to sell or close its campuses. The government also slapped Corinthian with a $30 million fine earlier this month for misrepresenting the rates at which graduates land jobs, a charge the school denies.

But that’s only a part of Corinthian’s problems. The school is fighting a $500 million lawsuit filed by the Consumer Financial Protection Bureau in September accusing Corinthian of steering students into high-cost loans. And state attorneys generals from Massachusetts to California have either launched investigations or filed lawsuits of their own.

... About 400 Corinthian students have filed what’s known as defense to repayment claims. It’s an appeal to the Education Department to forgive their federal loans on the grounds that Corinthian broke the law. Nine state attorneys general are backing the students’ claims.

... The stunning collapse of Corinthian arrives amid turmoil in the for-profit industry. Career colleges are broadly facing enrollment declines and regulatory scrutiny. Late last year, the Education Department unveiled rules aimed at limiting the amount of debt students amass in career-training programs. A trade group representing 1,400 for-profit college has filed a lawsuit against the government over the rule.