Corinthian Colleges Students Locked Out of Diplomas

Corinthian CollegesFor hundreds of thousands of college students, there are last papers, finals and maybe a few more lectures before they hit the end zone and graduation. For 16,000 enrollees at the Everest College, Heald College and WyoTech subsidiaries of locked up and shuttered Corinthian Colleges Inc. campuses, the students have large tuition bills and uncertainty instead of the diplomas or certificates many of them expected in the next month or two. The schools closed abruptly leaving confusion, frustration and tremendous levels of student debt behind.

After approximately five years of government investigations, the for-profit Corinthian Colleges, which offered primarily vocational training, abruptly shut down its remaining schools. The U.S. Department of Education is advising affected students. to consider transferring to more than a dozen other for-profit schools. Unfortunately, many of those school are also under investigation by federal or state authorities like Corinthian was for predatory recruiting techniques, falsifying employment rates and encouraging people to assume significant student loans with little prospect of earning the money back for some.

Easy access for students to acquire debt and pay high tuition rates lead to big profits for Corinthian. Then, as investigators closed in on and questioned more practices at the college chains, the federal government cut off the student aid that kept the company afloat.

The closure this weekend had been expected on business pages for a while. However, Corinthian did not warn students and staff, who were also promptly locked out.

Federal sources report that over 40 percent of the Everest, Heald and WyoTech students were within six months of completing their training or degree. The government is recommending that students consider transferring to another for-profit school. In fact, some Corinthian Colleges locations were taken over by other schools. That suggestion, however, is fraught with issues. It is questionable which schools, if any, will accept a lot of the Corinthian credits. Furthermore, many of the other for-profit vocational schools are also under investigation by federal and/or state authorities, so are they really viable transfer options?

The Department of Education Web site has spreadsheets showing a long list of 550 schools that are under investigation for their federal student aid practices and recruiting efforts. Others are under investigation for state aid by several attorneys general. The list of schools being recommended to Corinthian Colleges’ former students, that are also being investigated includes ITT Technical Institute, University of Phoenix, DeVry University, Kaplan University, Le Cordon Bleu, the Arts Institutes, and more. (Students considering any nontraditional college should check the list; it includes beauty school, culinary programs, technical training and more. Some public schools are on the list, but mostly because of paperwork issues.)

Adding to the confusion for students trying to figure out what to do now, the government has set up a program for Corinthian Colleges students who were locked out of earning diplomas and have large student loans. They are willing to forgive Corinthian students’ federal student loans, provided their college site shut down and they do not complete their studies at another school. The Education Department said forgiving loans for all those who were enrolled in a Corinthian Colleges program last week would cost taxpayers $214 million, so they want to limit the exposure to those who cannot finish the program that presumably would have employed them upon completion.

Congress is getting in the mix. As Sen. Dick Durbin (D-Ill.) noted on the Senate floor, “Has the Department of Education learned nothing?” Durbin also questions how “students — who just had their college disappear and are sitting on a pile of debt” that other schools with problems are viable transfer options?”

Rep. Janice Hahn (D-Calif.) called for more oversight. “This cannot be allowed to happen again,” Hahn said. While Corinthian Colleges’ locked out students might not have learned all they wanted and received diplomas, hopefully, the government will speed up its investigations of other schools and potential enrollees will check the list before forking out tuition payments.

By Dyanne Weiss

Federal Student Aid
Los Angeles Times
USA Today

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