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Congresswoman Maxine Waters

Representing the 43rd District of California

California Attorney General, Department of Education Confirm that Corinthian Colleges Engaged in Fraudulent Practices at California Schools

November 17, 2015
Press Release

 

WASHINGTON – Today, Congresswoman Maxine Waters (CA-43), Ranking Member of the Committee on Financial Services, commended California State Attorney General Kamala Harris and the Department of Education on their successful joint investigation of Corinthian College’s Wyotech and Everest California locations, as well as the Everest online programs based in Florida.  The investigation concluded that the programs misrepresented their placement rates to nearly 85,000 enrolled and prospective students.

The results of this investigation come on the heels of similar findings made by the Department of Education regarding Corinthian’s Heald campuses – which ultimately resulted in a $30 million fine against the for-profit college for misrepresentation of job placement rates and Corinthian’s closure just 2 months later – and a recent federal court ruling in a matter bought forth by the Consumer Financial Protection Bureau that Corinthian violated federal consumer protection laws. 

Corinthian had as many as 23 locations in California which enrolled 10,000 students at the time the school’s closure. These students were forced to endure extended abuse by Corinthian as no Corinthian California locations were included in Corinthian’s sale of 56 campuses to education non-profit, Educational Credit Management Corp. in February of this year.

 “After decades of focusing my legislative career on exposing the sham that is Corinthian Colleges, this news comes as no surprise,” said Congresswoman Waters. “We’ve known for years that Corinthian Colleges have been engaging in manipulative and fraudulent practices in an effort to lure students to pay high cost tuition for a low quality education. I am pleased that the Department of Education and the California Attorney General, Kamala Harris, were able to work together to help our students. I continue to urge more state attorneys general to initiate investigations with the Department of Education that continue to expose Corinthian’s wrongdoing.”

Because Corinthian’s action led to its own bankruptcy, Corinthian and its executives will not face any financial liability based on this or any other subsequent findings or judgements. Yet, students who were victims of these same actions remain liable for their student debt.   

“I am grateful that today’s findings will likely expand the number of students eligible for streamlined student loan relief,” Waters continued. “As the Department of Education and other federal agencies continue to investigate Corinthian, and as evidence continues to mount that both state and federal consumer protection laws are being violated, the Department should reconsider granting class wide debt relief to former Corinthian students. When looking at all the findings and judgments as a whole, there is a strong justification for the Department to extend full and immediate discharge relief to all harmed Corinthian students.”

Going forward, Congresswoman Waters will continue to work with students, advocates, and the Department to help ensure that Corinthian and other for-profit colleges are exposed for engaging in similar fraudulent practices, and that harmed borrowers receive the full relief they deserve.

Since her time as a member of the California State Assembly, Congresswoman Maxine Waters has fought to hold for-profit colleges accountable to the students they are purported to serve.  This year, Congresswoman Waters has introduced three pieces of legislation, the CLASS Act, the Students Before Profits Act, and the Ensuring Education Quality for Veteran Act, all designed to curb the abuses of for-profit colleges on our students. Additionally, Congresswoman Waters was the first member of Congress to publically endorse the Corinthian 100, a group of former Corinthian students who declared a debt strike in response to Corinthian’s fraudulent practices.

The Department of Education will refer the findings of this investigation to Joseph Smith, the Special Master in charge of borrower defense.  Students who attended Corinthian College or any of its subsidiaries can get more information by visiting https://oag.ca.gov/corinthian and www.studentaid.gov/Corinthian