Corinthian Colleges Fined for Bogus Job Placement Claims

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Corinthian Colleges Fined for Bogus Job Placement Claims

Corinthian Colleges Inc. has been fined $30 million by the U.S. Department of Education, which claims that the for-profit college operator of Everest, Heald, and WyoTech has been falsifying job placement rates to students.

Heald College has campuses in California, Oregon and Hawaii, and the DOE found 947 cases of false job placement rates, including instances where the college paid companies to create temporary jobs for graduates so they could be counted as placements. Some of the jobs lasted only two days. U.S. Under Secretary of Education Mitchell said that Corinthian “violated students’ and taxpayers’ trust,” and failed to provide “clear and accurate information to help students choose which college to attend.”

Corinthian was once among the largest of for-profit higher education operators in the United States, but last June the Department of Education declared it would restrict federal aid to the company over concern that they were falsifying job placement data. Corinthian agreed to sell off most of its schools, a majority of which was sold to a nonprofit student loan servicer last November. Corinthian still owns some of the schools, like Heald, but the Department of Education said that Heald College can no longer enroll new students, and must assist current students finish their education or complete it at a different college.

The fine comes when Corinthian has been seeking buyers for its Heald campuses. Last week, Heald’s president, Eeva Deshon, issued a press release saying the attorney general’s lawsuit was effectively blocking the sale.

Part of the lawsuit includes an injunction that requires buyers to assume potential legal liability at the school.

Hixson, the Corinthian spokesman, said the department’s fine “further threatens Heald’s future” by adding “financial and operational hurdles to prospective buyers.”

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