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Corinthian Colleges, with about 75,000 students in the US and Canada as well as online classes, owns 3 for-profit higher education brands: Everest College, Heald College, and WyoTech schools.
Corinthian receives $1.4B a year from federal education financing programs ($4 out of every $5 of its income).
Late last week, the company appeared headed for permanent closure, but an agreement reached Monday with DoE will allow it to stay in business with Federal oversight.
The US Department of Education has limited its access to federal funds after it failed to provide documents and other information to the agency.
That follows allegations that the company altered grades, student attendance records and falsified job-placement data used in advertisements for its schools.
[...]
The Education Department said that it heightened its oversight of the company after requesting data "multiple times" over the past five months
The company, based in Santa Ana, California, has previously been sued by California Attorney General Kamala Harris
for marketing fraud, arguing that the company mislead prospective students about how its graduates fared in the job market.
Worse, Everest officials paid nearby companies to hire their graduates for just long enough to make the school's statistics look better, then let them go. One Everest campus in Georgia paid companies $2,000 a head to keep Everest graduates on staff for 30 days.
[...]
the company will reportedly get the bridge funding it needs long enough to act on several DOE requests, including closing some of its schools and bringing in an independent auditor for its remaining operations. The DOE is weighing whether or not to reauthorize several Corinthian-owned schools for participation in the federal financial aid system, according to the Associated Press. The company will attempt to sell off significant parts of its 107-campus network.
(Score: 4, Funny) by Leebert on Wednesday June 25 2014, @01:49AM
That seems a little out of scope for the Department of Energy, doesn't it? :D
(Score: 1) by Buck Feta on Wednesday June 25 2014, @01:51AM
Also it's not much of a "victory".
- fractious political commentary goes here -
(Score: 1) by Ethanol-fueled on Wednesday June 25 2014, @02:23AM
Meh, having a bachelor's degree from the University of Phoenix is worthless, because your lack of real-world skills makes you a liability compared to everybody else who graduated from a normal university, but having a master's from U of Phoenix with a bachelor's from somewhere reputable is worth gold to the company. It means the company can get exempt-tier hours from your servitude, somewhat-useful experience from your prior education, as well as a marginal pay increase that totally wasn't worth the costs to you, but it's the only bone we'll throw you because we know you need this more than we do.
Just like ITT tech, our alumni once planted will receive an under-the-table stipend for hiring you as long as you have red socks*. [youtube.com] So be sure to wear those red socks to your interview.
* note: the red sock must not be confused for the Pink Sock. [urbandictionary.com]
(Score: 0) by Anonymous Coward on Wednesday June 25 2014, @04:38AM
Insightful. Funny, right? Right?
(Score: 2) by davester666 on Wednesday June 25 2014, @07:37AM
somebodies got to produce the hamsters that spin the energy wheel
(Score: 3, Interesting) by bradley13 on Wednesday June 25 2014, @05:41AM
Of course, the biggest question remains: Why is the U.S. federal government involved in education at all? This is a mandate that is glaringly absent from the U.S. Constitution. And to be so involved that a no-name private college received 80% of its funding from the feds?
Everyone is somebody else's weirdo.
(Score: 4, Interesting) by aristarchus on Wednesday June 25 2014, @07:09AM
Hmm, very good question. One explanation I have seen of the push for accountability in higher education is that the for-profits want some measureable stats by which to compare themselves to actual universities and colleges. It is not surprising that these "businesses" have found it in their interest to bribe companies to hire their "graduates" to keep the stats up! But that leads us back to the original question, what is the government doing in higher education at all?
Stay with me, this may take a while. First, know that my user name is that of a Greek Astronomer of the 3rd Century BC. That means I predate the university system by quite a while. But even in my time schools had been established, the Academy of Plato, the Lyceum of Aristotle, and the Ptolemy's established the library of Alexandria and its attendant school. Now all this went to crap, probably due to the Romans, who were much more interested in strategy and engineering than science and philosophy. Universities, such are they are, were established in Europe in the mid-middle ages. This is probably due to the foresight of Charlemagne, or Charles Magnus of the house of Pepin. Franks, you know. The University of Paris, and Oxford, and Bologna became rather famous centers of learning. But one of my favorite stories is that at one point some flunky of the English Royal court asked how had Oxford managed to function for its first several centuries of existence without a Chancellor! The answer, of course, was quite well, since the chancellor was only instituted to be the representative of the crown, to keep an eye on those treasonous scholars.
So we end up with a battle, the crown versus actual knowledge, and the result is certain traditions like tenure, where the government cannot just get rid of scholars whose scholarship it finds, um, inconvenient. And we are skipping over all the conflict with organized religion, since I assume everyone on Soylent News has seen the new Cosmos.
Democracy. The first requirement of a real democracy is that it respect the autonomy of every citizen. Of course, to do that, we have to make sure that the said citizen is educated enough to form his or her own opinion and not be lead by demagogues like Hitler and George W. Bush. Now in America, which does seem to be a special case, or at least first in this, the meant universal access to higher education. College was no longer for the the upper classes exclusively, something that first really came to pass with the GI Bill after WWII.
This lead to a bunch of working class people getting educated, and then their children all turned into Hippies, and so that whole "higher education for everyone" thing was backed away from. But the precedent had been set, where there is tax money available, there will be sleaze-ball entrepreneurs trying to make a buck off it. And since the whole real estate, sub-prime derivative "what was that?" market crashed, what better area to go into than education? People might realize that a loan on real estate is just insane at some point, but when do you realize that you spent too much on getting a bachelor's degree?
OK,summary: it is not that government has no business intervening in higher education, it is that it already has, and with what are actually good public interest reasons. But that intervention has introduced a profit potential with has attracted sharks, scumbags, and Republicans and the higher education version of Charter Schools, so the government has no choice but to counter-intervene to level the playing field, and hopefully leave questions of legitimacy up to those with the actual expertise, scholars. Any questions? There will be an exam in two days.
(Score: 0) by Anonymous Coward on Wednesday June 25 2014, @09:54PM
the for-profits want some [measurable] stats by which to compare themselves
They should be careful what they wish for.
As an example, in the first study of charter school performance, 83 percent of the time they did no better than the standard public schools. [google.com]
Subsequent studies have reached similar conclusions.
One wonders how poor the results of the charter schools would be if they didn't get to cherry-pick their students to start with and couldn't expel them on a whim.
More on the "excellence" of charter schools. [wordpress.com]
...and with "measuring", you're heading in the direction of standardized testing--another boondoggle that sends public money to private hands.
.
we have to make sure that the said citizen is educated enough to form his or her own opinion and not be lead by demagogues
You're remembering the '60s (the children of the first GI Bill graduates).
California Governor Ronald Reagan et al tried very hard to totally crush the free thinking that you prescribe.
(When he became US President, that former president of the Screen Actors Guild made every effort to crush unions in a similar way.)
The 1 Percent needs cheap, compliant workers.
If those workers are heavily in debt, that is to the advantage of the elite class (re: compliance).
If they elites can't find those serfs here, they know that they can find them offshore.
That is the current paradigm.
-- gewg_
(Score: 1) by rheaghen on Thursday June 26 2014, @03:55AM
Why oh why indeed! The last time I checked the governments rolein Society is to, well, GOVERN! Alas! The truth has been revealed unto thee. Go forth and quell this non-igorance to the willfully ignorant ignoramuses who ignore the meaning of the word "government"!
(Score: 2) by RedBear on Wednesday June 25 2014, @06:55AM
I read the entire summary and have no idea what the purpose of this crackdown is, why funds are being restricted, or why this is considered (by someone) a "victory". Worst summary I've seen in a long time. Aside from being "for-profit" (is that not allowed in the US college system?), what was this company doing wrong? Is it only a problem because they accept federal funds?
Without reading the entire linked article I have no idea what we're even supposed to be commenting on. The linked article is pretty bad too, for anyone not already familiar with whatever the article is talking about. Where is the victory, and why is it a victory? The word is not found in the linked article.
Color me confused.
¯\_ʕ◔.◔ʔ_/¯ LOL. I dunno. I'm just a bear.
... Peace out. Got bear stuff to do. 彡ʕ⌐■.■ʔ
(Score: 2) by VLM on Wednesday June 25 2014, @11:35AM
"what was this company doing wrong?"
Its a problem of magnitude not direction.
They tell the same lies all higher ed institutions tell, but they went a little overboard compared to other higher ed institutions.
The .biz model Everest uses is advertise heavily on lower class TV (judge judy, that type of thing) promising the world (easy classes, high paying jobs in the game design field, etc) then open a campus in a diverse (poor) neighborhood, sign up students for as many loans as the .gov will allow at the absolute maximum amount allowed, then close. Almost none of the kids will get a job in the field, of course. A stereotypical example would be the Milwaukee experience.
Its strongly implied by society if you go to ... UW Madison ... and get an education degree, you'll automagically end up in a $100K/yr public school job. And if they had over the top TV commercials like Everest they'd probably be in the same legal trouble. Reality is most ed grads end up waitresses, real estate agents, bartenders, etc, very few indeed end up spending a significant length of their career as "wealthy public school teachers" or as teachers of any sort (note no one ever says the phrase, "wealthy catholic school teachers" LOL as my sister in law ended up well under minimum wage working there before getting her big break into pub schools after a decade or so).
(Score: 1) by SecurityGuy on Wednesday June 25 2014, @04:32PM
Nah, if they're really paying companies to hire their grads for 30 days in order to boost their stats, they're engaging in blatant fraud and people should be in jail for it. When I went to university, stats were readily available for % of students with an offer by graduation, or 3 months after, I forget, and average salary. I graduated and made 20% over the average they quoted. Maybe things have changed in the last ~15 years, but real data wasn't at all hard to come by when I looked for it. The difference is that these guys are being accused of fraudulently manipulating the data.
(Score: 2) by VLM on Wednesday June 25 2014, @05:53PM
Eh, one mans "blatant fraud" is anothers advertising. I am told this is now BAU at most law schools, to boost rankings. Harvard Law will take care of itself, I'm talking about the less prestigious places.
Sometimes I wonder about that and how manipulated it is. I'm sure when I finally graduated night school with my BSCS they were thrilled to add the salary of a highly paid 30-something experienced programmer to their new grads stats, that doesn't mean some 22 yr old kid who can barely compile helloworld.cpp with googles help would have any relationship to the warped salary average.
(Score: 0) by Anonymous Coward on Wednesday June 25 2014, @12:38PM
Commdared Wyotech sells you a Pirozhki. You pay for it and take a bite. It's made of cardboard and filled with mouse turds. Additionally it was expensive. A cop comes along and tells Wyotech he can keep selling mouse-turd Pirozhkis, but that he's under observation.
(Score: 2) by hoochiecoochieman on Wednesday June 25 2014, @10:12AM
It's great that this is a private school, and not public.
If it was public, it would be a cesspool of corruption, vacuuming money from the taxpayers and indoctrinating the students.
Thank God for private education!
(Score: 2) by VLM on Wednesday June 25 2014, @11:39AM
You'll note the attacks are all against the brands. The people who did this will get away with it and run the same scam, but under a different name. Everest has gradually accumulated quite the reputation, and its good that it has this toxic reputation. The only real effect of this PR campaign by .gov is we're all going to have to learn a new toxic brand name, perhaps next year btripehgiv(.com) will be the "new" Everest running the same scam with the same employees. So in one way this story sucks.
(Score: 0) by Anonymous Coward on Wednesday June 25 2014, @01:24PM
The title states this is a victory, and while it may be a victory for the federal government, it is a loss to everyone else. The federal government has now grown in size and requires more money and more complexity to oversee this business, rather than shut the business down permanently. If what they did was so egregious, punish them by closing them as originally planned, and let other hopefully more responsible schools fill the vacuum. Instead they grew their empire and made everything more complicated while continuing to let this bad business remain, bilking customers and taxpayers for an indeterminate amount of time.
(Score: 0) by Anonymous Coward on Wednesday June 25 2014, @08:34PM
The title states this is a victory
Had I been a bit more ambitious, I would have crafted my own, more-apt title, as I often do.
bilking customers and taxpayers
I was going to post my link higher in the thread, but your rhetoric is even closer to my point.
The gov't of the USA (and I'm guessing most other places) is a scheme to redirect cash to cronies and potential cronies.
It seems the best we can do is to try to assure that the dough doesn't go to complete dicks.
Going further with my point, if the Feds were to e.g. cut out the private sector on handling the money (student loans), it would cost less than half of what is currently being spent.
How The Government Could Make Public College Free For All Students [googleusercontent.com] (orig) [popularresistance.org]
There was a time in this country (in my lifetime, in fact) when people graduated from college without a monstrous debt burden.
There were generations of people who had financed their degrees with only a summer job.
In those years, the gov't picked up 80 percent of the tab and the student only needed to provide 20 percent.
In the era of Reaganomics, those numbers have been flipped.
-- gewg_
(Score: 1) by Balderdash on Wednesday June 25 2014, @06:25PM
Once got spammed by an admissions headhunter from AIU Online.
His name was Artie something-or-other. He was a dick.
I stayed on the line a bit to find out what exactly he was selling.
Apparently I could have gotten a 4 year degree in one year if I claimed to have "real world experience" in the chosen area.
He kept pushing the Sallie Mae student loans bit.
That is how they make their money. Government student loans.
I browse at -1. Free and open discourse requires consideration and review of all attempts at participation.