Over the last two years, for-profit colleges have come under criticism from the government due to charges that their main focus is profit rather than providing a high-quality education. Graduates can find themselves saddled with large debts, all for a degree that doesn't get them a job.
Corinthian Colleges Inc. and its subsidiary colleges are the latest target, as a lawsuit filed by the California Attorney General alleges that Corinthian planned and executed predatory schemes that raked in profits while misleading students.
California Attorney General Kamala Harris filed a lawsuit on Thursday against Santa Ana, California-based Corinthian Colleges Inc. for allegedly misrepresenting its high job placement rates to lure low-income Californians whom the company described as "isolated," "impatient" and having "low self-esteem". As alleged by Harris, the company once paid a temporary employment agency to hire graduates to boost these placement figures.
"The predatory scheme devised by executives at Corinthian Colleges, Inc. is unconscionable. Designed to rake in profits and mislead investors, they targeted some of our state's most particularly vulnerable people — including low income, single mothers and veterans returning from combat," Harris said in a release on the Attorney General's website.
According to Paul Elias of Association Press, Harris said the majority of those students are minorities in their mid-20s with annual incomes of about $20,000. He said that many were single mothers.
"Corinthian College was serving not as an educator but as a predator of some of the most vulnerable people in our community," Harris said.
Additionally, Harris alleges that CCI, which says it serves more than 81,000 students on 111 campuses scattered throughout the United States and Canada, intentionally misrepresented job placement rates to investors and accrediting agencies.
The complaint was filed against Corinthian Colleges Inc. and its 3 subsidiaries – Heald, Everest and WyoTech colleges, all of which have campuses in California. Everest College is said to have paid a temporary employment agency, Remedy Temp, to hire graduates for two days in order to increase job placement figures, as cited by emails in the lawsuit. Among the expenses cited in the lawsuit were those for Heald College in San Francisco, which charged $39,510 in tuition and fees, in addition to $3,500 for books and supplies, for a 2-year applied science degree for medical assistants.
According to NBC4 Los Angeles, the complaint alleges that California Colleges Inc. advertised job placement rates for specific programs as high as 100 percent when, in some cases, there is no evidence that any students from the specified time frame obtained a job. It goes on to say that although Corinthian Colleges Inc. never offered x-ray, radiology and dialysis technician programs at their California campuses, it ran millions of online and mobile ads advertising those courses.
However, a spokesman for the company said that Corinthian was disappointed that Harris filed the lawsuit because it has been cooperating with the Attorney General's office for nine months. He said the company will fight the lawsuit.
"We were disappointed to learn today of the civil complaint filed by the California Attorney General," Kent Jenkins said. "We are committed to regulatory compliance and have robust processes in place to correctly record and disclose the job placement information we receive from our graduates and their employers."
Bridgepoint Education was also named in Harris' suit. The for-profit provider, which has ~80,000 students, most of whom are online, has been asked to provide records that the Attorney General believes will show improprieties.