Corinthian Colleges, under intense scrutiny including from the federal government, abruptly closed its doors on Sunday. The move by this for-profit college system effectively left 16,000 college students without a school to call their home.
Those students were enrolled at Heald College in California or with Everest or Wyotech campuses elsewhere. The company — Corinthian Colleges, Inc. — said that it had attempted to comply with federal regulators but found that its efforts to sell off its campuses were thwarted by these very same regulators.
Said Jack Massimino, Chief Executive Officer of Corinthian. ”Unfortunately the current regulatory environment would not allow us to complete a transaction with several interested parties that would have allowed for a seamless transition for our students.”
End of the Line
That Corinthian Colleges has shut its doors was expected, but most had hoped that it would follow a dissolution process that would have transferred students to other schools while allowing some students to complete their education as they neared their degrees. The sudden closure halts the college pilgrimage for an undetermined number of soon-to-graduate students.
The affected students may receive assistance from the US Department of Education as they explore their options. In response to the sudden closure Education Under Secretary Ted Mitchell issued a statement articulating the government’s position.
“Students seeking better life options should be assured that their investments will pay off in increased knowledge, skills, and opportunity. Today, Corinthian Colleges, Inc., announced it was effectively ending operations, following the company’s failure to find a buyer for its remaining campuses willing to abide by conditions put in place by the Department to protect students, borrowers and taxpayers. As Corinthian closes its doors for good, the Department will continue to keep students at the heart of every decision we make. Department staff will immediately begin outreach to Corinthian students to review all their options, which may include loan discharges for students whose school closed. What these students have experienced is unacceptable and we look forward to working with Congress in an effort to improve accountability and transparency in the career college industry. A college education remains the best investment a student can make in his or her future, and this Administration will continue to work to make a college degree affordable for all students, to hold colleges accountable, and to safeguard the interests of taxpayers.”
Student Loan Discharge
Discharging student loans is a rarity and typically occurs under very narrow circumstances, including fraud committed by a college. It is this alleged fraud that has US senators and other officials calling for relief.
Despite the setback, Corinthian officials painted a positive picture of what these schools offer students. ”Colleges like ours fill an important role in the broader education system and address a critical need that remains largely unmet by community colleges and other public sector schools,“ Massimino said. “Overall, our schools did a good job for the students they served. We made every effort to address regulators’ concerns in good faith. Neither our Board of Directors, our management, our faculty, nor our students believe these schools deserved to be forced to close.”