Recruiters for Corinthian Colleges enrolled a homeless, jobless student who was squatting on a plot of vacant land — living out of a camping tent — and facilitated student loans for her.
That’s the scathing lowlight among many other desultory antics by the defunct for-profit college chain exposed in thousands of pages of emails and other documents obtained by ProPublica, a nonprofit investigative journalism outfit.
The records are part of a lawsuit filed by the California Attorney General against Corinthian Colleges.
The then-homeless woman is Hollie Harsh. Harsh testified that she and Brian French, her fiancé at the time, toured the Concord, Calif. campus of Heald College and liked the place. (Corinthian operated schools under three different names. None of them were “Corinthian.” Instead, the schools were called Everest, Heald College and Wyotech.)
Harsh and French explained to their friendly Corinthian recruiter that they were residing in a tent with no electricity in an industrial city in the San Francisco Bay Area. Unfazed by this considerable obstacle to college enrollment, Harsh said, the recruiter encouraged Harsh to take on several thousand dollars in federal student loans and enthusiastically plugged future job prospects.
Excited, Harsh and French relocated their tent right across the street from the Heald campus. This location proved to be a bummer, though, because a deputy sheriff evicted them after a couple weeks. Harsh and French responded by moving their tent once again, this time to a choice spot on the Heald campus.
Living in a tent proved to be an academic challenge, Harsh testified.
After a semester or so, Harsh dropped out of Heald College, saddled with over $15,000 in student loan debt.
Another Heald student had a similar story. She enrolled at the Heald campus in Rancho Cordova, Calif., racked up about $6,000 in student loans, and eventually quit. This student was a 20-year-old single mother who had grown up in foster care.
A collection agency took over the $6,000 in student loans, ruining the single mother’s credit and causing concern that she would end up homeless.
Corinthian recruiters also boasted of imaginary programs, such as “X-Ray Training School” and “Ultrasound Tech School.”
Additionally, Corinthian management encouraged recruiters to target potential enrollees with “low self-esteem and few base hits,” according to ProPublica.
A long, absolutely searing U.S. Senate report entitled “For Profit Higher Education: The Failure to Safeguard the Federal Investment and Ensure Student Success” lays out the appalling behavior by several for-profit education players.
The report shows that Corinthian has been far from the worst offender. Nevertheless, the report criticized its corporate behavior harshly.
For example, the report notes, Corinthian took in over 80 percent of its revenue from federal financial aid programs in 2010. The previous year, it had spent $294.7 million for marketing purposes and dedicated $119.2 million to profit.
Jack Massimino, the CEO, received a sweet $3.3 million compensation package in 2009 alone. By comparison, the president of the University of California at Irvine brought home $382,980 for the 2009-10 academic year.
California’s Attorney General has observed that Corinthian charged its students high tuition relative to other for-profit colleges (and private, nonprofit colleges and, certainly, public colleges).
For example, students at Corinthian’s Heald College in Fresno, Calif. paid $22,275 for a degree in its medical assistant program. The same basic degree earned at Fresno City College costs $1,650.
The Senate report also criticized Corinthian for its aggressive recruitment techniques — a problem endemic to many large for-profit college companies. For example, a 2005 hiring manual firmly reminded recruiters “that this is a sales position and the new hire must understand that from the very beginning.” Another document was called “Overcoming Phone Obstacles.”
Corinthian coaxed students to borrow private loans from banks with which it had concealed sweetheart deals, according to ProPublica. Then, when students couldn’t pay back these loans, Corinthian sicced debt collectors on them — even going so far as barring students from classes.
Corinthian was once one of the biggest players among North America’s for-profit colleges. The for-profit behemoth abruptly fell apart in 2014 amid accusations that it was inflating graduates’ job placement rates and attempting to defraud the federal government. (RELATED: Obama Administration Kills Corinthian Colleges)
In the summer of 2015, Corinthian Colleges officially announced that it was bidding goodbye to the world. More than 16,000 students across the country found their college educations abruptly ended when the for-profit chain ceased all operations at its last 28 campuses.
Corinthian’s problems began in January 2014 when officials from the U.S. Department of Education requested in-depth information about individual Corinthian students including their attendance records, the jobs they ended up getting and their Social Security numbers.
Federal officials sought the information to investigate whether the for-profit college group was abiding by regulations connecting federal aid money to various measurable outcomes for students and graduates.
For reasons that are unclear, Corinthian failed to respond to the records request to the satisfaction of Education Department officials. The bureaucrats responded by holding Corinthian’s federal aid funding for 21 days. This hold, coupled with lower enrollment and already-existing financial issues, caused a huge cash flow problem.
As is the case with many for-profit schools, a great many students at Corinthian’s schools were relying heavily on federal student loans to pay for their educations.
Almost the entire for-profit education industry has been hit hard in recent years by declining enrollment and increased scrutiny from federal and state officials. While part of the pressure is due to slumping enrollment, the companies have brought much of the heat on themselves because of business practices that range from questionable to downright predatory. (RELATED: Does Anybody Want To Buy A Dying For-Profit College For A Billion Dollars?)
In the summer of 2014, the Education Department announced that it was implementing a plan to forgive as much as $3.6 billion in student loans given to students attending schools affiliated with Corinthian Colleges.
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