Corinthian Colleges Files for Bankruptcy

Corinthian Colleges, until recently one of the country’s largest for-profit higher education chains, filed for chapter 11 bankruptcy this Monday, one week after shutting down its remaining campuses.

This marks the climax of the collapse of the company that was once praised on Wall Street for its profitable model of offering degrees to low-income students who took out heavy student loans from the government to pay the cost of their tuition. However, allegations accumulated around the company, exposing lies about the success of its programs and the predatory methods used to push loans on its students, ultimately leading to a slew of government lawsuits and a loss of access to its primary source of funding, the federal government.

Corinthian Colleges, which operated Everest, Heald, and WyoTech colleges, spend much of this past year winding down its operations due to the Department of Education cutting off its access to federal aid due to allegations of falsified job placement claims and graduation rates. The department allotted Corinthian $16 million in federal funding to keep it alive long enough to sell or close its 107 campuses around the country.

In November, one of the largest debt collectors employed by the Department of Education, ECMC Group, bought more than half of Corinthian’s campuses for $24 million. Corinthian was having trouble selling off the remaining schools amid growing government lawsuits and a large federal fine.

Just a few weeks ago, Corinthian was hit with a $30 million fine for misrepresenting its job placement rates; an allegation the school denies. The department discovered 947 cases of false placement rates given to students. Heald College was found to be paying temp agencies to hire its graduates to work as few as two days, so they could add those students to their job placement statistics.

Corinthian is also being sued by several state attorneys general for its deceptive marketing practices. Corinthian is also entangled in a $500 million lawsuit with the Consumer Financial Protection Bureau, which accused the company of intentionally steering its students into high cost loans.

Due to the closure of these schools and the pending lawsuits against them, students currently have the option for loan forgiveness if they meet certain qualifications. Call us today to find out if you are eligible.

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Comments (8)

  1. HOLLY Helmer
    September 4, 2015

    I have a student loan throoug navient.eas sallie mae.when i went to everest back 2010.i dropped out.does this apply to me.i have my loan in forbearande.i have a hard loan amount i belive is 15,000.

    • Admin
      September 5, 2015

      We would love you to help you out Holly,

      Please call us directly at 424-325-6343 and leave a voicemail if the lines are busy. We also will have one of the reps email you directly to further help you out.

  2. Lacy Cole
    September 7, 2015

    I attended Heald college in Roseville, CA from 2009-2011. I initially signed up for the MIBC certificate program then rolled it into the A.A.S. program when it was first introduced. I completely believe they lied to me know many aspects just to get me to sign papers. I want to know if there is any sort of forgiveness for my loans.

    • Admin
      September 9, 2015

      We would love you to help you out Lacy,

      Please call us directly at 424-325-6343 and leave a voicemail if the lines are busy. We also will have one of the reps email you directly to further help you out.

  3. Olivia L
    September 22, 2015

    I attended Everest in Silver Spring MD back in 2009-2010. Although I did complete the course I didn’t gain a career as a medical assistant. I was making A’s and was even an ambassador. Even though I learned a lot through taking this course, I feel like I also wasted money because I didn’t actually get the job I thought I would have through them. I had to take out a genesis loan to attend the school and want to know if it’s possible for my loan to be forgiven seeing that I didn’t really get what I expected besides what I retained and big bill?

  4. Mayra
    November 12, 2015

    I graduated Everest in 2013. Do I qualify for loan forgiveness?

  5. Education Dept. Sent Corinthian Students to Closing Westwood College | Goodbye Loans
    February 10, 2016

    […] Past spring, when forprofit Corinthian Colleges unexpectedly shut-down beneath the weight of claims of deceptive actions, Corinthian students had […]

  6. Elizabeth Schiada
    July 13, 2016

    I was on a pay as you go plan when I went to Everest for the MAA program. My parents paid for me. I am also interested in seeing if I’d qualify for a refund of some sort.

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