Corinthian Colleges

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https://www.motherjones.com/politics/2022/06/education-department-student-debt-cancellation-:{**corinthian**:(style="background-color:#ff9900;"):}:/

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http://www.help.senate.gov/imo/media/for_profit_report/Contents.pdf

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https://assets.documentcloud.org/documents/2073227/corinthian-bankruptcy-filing.txt

searchable

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https://www.alternet.org/2019/10/betsy-devos-held-in-contempt-and-gets-100000-fine-for-gauging-defrauded-students/

no lnx

Betsy DeVos held in contempt and gets $100,000 fine for gauging defrauded students

Written by Laura Clawson / Daily Kos October 25, 2019

Education Secretary Betsy DeVos was held in contempt of court and slapped with a $100,000 fine (which the government will pay) for continuing to collect loan payments from students who were defrauded by the now-closed for-profit Corinthian Colleges. U.S. Magistrate Judge Sallie Kim had ordered the Education Department to stop collecting on loans owed by around 16,000 former Corinthian students, an order the Education Department mostly ignored.

In issuing the rebuke, Kim said that “the evidence shows only minimal efforts to comply with the preliminary injunction.” In some cases, the government even seized tax refunds or wages to collect the money that the former students were not supposed to have to pay.

When Sen. Elizabeth Warren confronted DeVos over this issue at a Senate hearing earlier this month, DeVos tweeted, “Loan servicers made an error on a small # of loans.”

Again, 16,000 borrowers are involved. Blaming loan servicers is the Education Department’s strategy for responding to the contempt citation, because, as usual, when rich people like Betsy DeVos get called out on their abuses, they scream that it’s unfair and demand to evade accountability, even as they insist that students who were literally defrauded by a for-profit college should get no relief.

The Education Department is refunding “at least 3,200” of the borrowers, but 3,200 is a long way from 16,000. The $100,000 fine will go to help some of the students. The judge is also requiring the Education Department to provide monthly updates on what it’s doing to make things right, and if the agency continues dragging its feet, she might “impose additional sanctions, including the appointment of a Special Master to ensure compliance with the preliminary injunction.”

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http://www.alternet.org/education/exposing-profit-colleges-cynical-project-make-money-kids-low-self-esteem

https://www.propublica.org/article/how-a-for-profit-college-targeted-homeless-and-kids-with-low-self-esteem

How a For-Profit College Targeted the Homeless and Kids With Low Self-Esteem

Newly released emails and PowerPoints show first-hand Corinthian Colleges’ predatory practices.

Perhaps you remember Corinthian Colleges. It was the country’s second largest chain of for-profit colleges, before it collapsed into bankruptcy last year amid evidence of phony marketing and predatory loans.

The shenanigans brought investigations from more than 20 state attorneys general and the federal Consumer Financial Protection Bureau.

But the actual emails and testimony underlying the allegations haven’t been public. Until now.

Earlier this week, California’s Attorney General quietly filed thousands of pages of documents and testimony as part of an ongoing lawsuit against Corinthian. We trudged through them and, well, just read the upshots.

Corinthian recruited homeless students and then helped them get federal loans they couldn’t pay back.

Hollie Harsh testified that she and her fiancé Brian French were homeless and living in a tent on vacant land in Northern California when they toured one of Corinthian’s campuses. They told a recruiter they were homeless and unemployed. Despite that, the recruiter enrolled both of them that day, promising strong future job prospects. They took on thousands in federal loans that, given their circumstances, would be difficult to pay back.

The day before classes started, Harsh and French moved their tent to an empty lot across the street from campus. They were kicked off the lot by a deputy sheriff two weeks later, so they moved the tent to the school’s grounds instead, with the knowledge of the campus president. Harsh’s testimony describes tough 2010, Reeder worked as a counselor at a nonprofit organization that assists homeless and former foster kids. One of the former foster kids under her care, a 20-year-old single mother living in a transitional apartment, enrolled at a Corinthian school after the school told her that they would provide additional attention because of her learning disabilities. Like Harsh, she signed up for thousands in loans. A few days after the program started, she realized that she could not keep up with the pace of the courses and dropped out of the program with $6,000 in debt.

Her unpaid loans were sent to a collection agency, ruining her credit. And because of her tarnished credit, she could potentially become homeless, Reeder said:

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http://files.consumerfinance.gov/f/201409_cfpb_complaint_corinthian.pdf

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halprin overview

everest crim justice read 3rd grade:

http://www.huffingtonpost.com/davidhalperin/for-profit-college-enroll_b_5433550.html

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**http://www.bloomberg.com/politics/articles/2015-04-29/marco-rubio-goes-to-bat-for-corinthian-colleges**

Last summer, Senator Marco Rubio of Florida asked the U.S. Department of Education to "demonstrate leniency" toward Corinthian Colleges by permitting the wealthy for-profit company to continue accessing millions of dollars in federal financial aid while it was cooperating with a federal investigation.

Ten months later, the company shuttered its remaining 28 campuses, instantly displacing some 16,000 students just days after it was fined $30 million by the Department of Education for a scheme involving "confirmed cases of misrepresentation of job placement rates" for as many as 947 students. The decision to close shop came after years of federal and state investigations into the company.

The top-tier Republican presidential candidate had made his plea in a letter—obtained by Bloomberg Politics—dated June 20, 2014 and addressed to Jim Shelton, the deputy secretary of education, and Ted Mitchell, the undersecretary for post-secondary education.

"It has been brought to my attention that the U.S. Department of Education has recently placed extreme financial constraints on Corinthian Colleges, Inc. by restricting the company's timely access to federal financial aid. It is my understanding the the Department of Education has requested extensive documents be provided by Corinthian Colleges for review, and Corinthian has acted in good faith to try to provide these documents as expeditiously as possible," Rubio wrote.

"While I commend the Department's desire to protect our nation's students from fraudulent and malicious activity by any institution of higher education, regardless of tax status, I believe the Department can and should demonstrate leniency as long as Corinthian Colleges, Inc. continues to expeditiously and earnestly cooperate by providing the documents requested."

Founded in 1995 by five for-profit education operators, the company once ran more than 100 campuses across the country, including in Rubio's home state of Florida. (He described his letter as written on behalf of his constituents.) In February, the Consumer Financial Protection Bureau announced $480 million in debt relief for students it deemed were "harmed by Corinthian's predatory lending scheme."

Mitchell responded to Rubio on April 2, explaining that the federal investigation found "systemic deficiencies" in the company's operations and mentioned that the organization had "admitted to falsifying placement rates and/or grade and attendance records at various institutions."

In its final year, Corinthian Colleges reportedly said it received $1.2 billion in federal student loans.

"Senator Rubio felt it was important to protect the thousands of students in Florida from being punished and having their educations disrupted while the investigation was underway," Rubio spokeswoman Brooke Sammon told Bloomberg Politics in a statement. "His priority has always been to improve access to higher education options and increase transparency ‎in higher education."

Corinthian Colleges contributed $5,000 to Rubio's Reclaim America PAC during the 2014 election cycle, according to the Center For Responsive Politics, a nonpartisan organization that tracks political donations.

But that's not the full story.

Rubio is a noted supporter of "alternative" forms of higher education, describing them in various speeches and statements as a way to help middle class Americans deal with rising tuition costs in an era where college degrees are increasingly vital to success. In 2014, he introduced legislation to encourage federal agencies to hire people with "alternative educational experience." As recently as two days ago, Rubio tweeted about his education proposals. Ironically, his message mirrored that of Corinthian's critics.

Students deserve to know how much a degree will help them earn BEFORE taking out a #studentloan. My plan: http://t.co/Siw5VLnkTW

— Marco Rubio (@marcorubio) April 28, 2015

Two weeks ago, the Floridian pressed his message to students at Manchester Community College in New Hampshire. "We have only one way of providing higher education in America, and that is, we tell everybody, ‘You either go to a traditional college or you go nowhere,’” he said, according to the New York Times. "That isn't working."

In July 2000, anticipating the good results, Credit Suisse First Boston upped its 18-month price target for Corinthian stock from $35 to $40 a share. Wall Street didn't seem to be paying attention at first; by July Corinthian stock was at just over $23 a share, and that was down from a high of $27.25. It jumped again following the announcement of the yearly results in August, however, and reached $55 a share by early September. Stock prices dropped again later in the month, by nearly 20 percent when the company announced that its executives and some major institutional investors would release about three million of their own shares for public trading in a secondary stock offering. The stock was offered to the market in October 2000 for $50 a share. Just a day later the shares had risen to $54. In November, Corinthian's stock was strong again. Its value had increased fourfold since the spring, reaching $65.63 per share. The company's board of directors announced that a two-for-one split of Corinthian common stock would take place in mid-December. After the split, the company had some 23 million shares available for trading.

Beginning in October 2000, Corinthian Colleges made more substantial additions to its portfolio of schools. First it acquired four colleges from Educorp, Inc. Located in Los Angeles, Whittier, Ontario, and Long Beach, California, the schools had about 1,400 students enrolled primarily in allied health programs. Just days after the Educorp acquisition, Corinthian purchased the two campuses of the California Training Academy. The information technology and business schools added about 500 students to Corinthian's total student body. Later, in January 2001, the company opened a branch campus in Rancho Cucamonga, California. By the start of 2001, Corinthian had record numbers of students in Internet-based distance learning courses. 1,276 students were enrolled 28 different courses offered via eleven Corinthian campuses. The company planned to add 18 courses and five additional campuses, as well as the possibility of earning associates and bachelors degrees online by the middle of 2001. Moreover, at the beginning of February the company purchased the Grand Rapids Educational Center Inc. for approximately $3.1 million. The acquisition included three Michigan campuses in Grand Rapids, Kalamazoo, and Merrillville, with about 460 students altogether. Corinthian planned to merge its campus in Wyoming, Michigan, into the Grand Rapids campus. Early in 2001, the company announced plans to open new schools in Dearborn, Michigan, and one in Skokie Illinois. The Skokie campus would be Corinthian's first in the Chicago area.

Principal Divisions: Corinthian Schools, Inc.; Rhodes Colleges, Inc.

Principal Competitors: ITT Educational Services Inc.; Apollo Group, Inc.; DeVry Inc.

http://www.fundinguniverse.com/company-histories/corinthian-colleges-inc-history/

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The U.S. Department of Education has blessed a deal under which a non-profit student debt collection company, Minnesota-based Education Credit Management Corporation (ECMC), will pay $24 million to acquire 56 campuses, operating under the brands Everest and WyoTech, owned by collapsing Corinthian Colleges, one of the most abusive and deceptive for-profit college companies. The terms of this deal are extraordinarily unfavorable to students.  The agreement creates a remarkable conflict of interest for the Department itself, and it sets terrible precedents for future failing colleges.

The deal is so bad that it seems that the Department is determined to prop up these Corinthian campuses at all costs.  In other words, it has concluded that Corinthian Colleges is too big to fail.  It is making a terrible mistake.

The Obama administration has done a great deal of hard work to try to stop the torrent of waste, fraud, and abuse engaged in by many companies in the for-profit college industry, which has been grabbing more than $30 billion a year in taxpayer money, mostly to offer career education programs in fields like medical assisting, criminal justice, and auto repair. The bad institutions in this sector offer poor to middling quality programs, charge sky-high prices, and use deceptive and high-pressure marketing to sign up as many students as possible, and deposit their federal aid checks, regardless of whether they will benefit from the program. Corinthian has been among the worst along those lines. The administration has been doing some good things to try to target federal aid away from such bad programs and toward those that actually help students build careers. But the ECMC-Corinthian decision puts that progress at risk.

It’s not too late, though, for the Department to change course.

Minutes ago, 46 civil rights, veterans, student, and consumer groups, part of a coalition in which I am a participant, sent a letter to Secretary of Education Arne Duncan, Attorney General Eric Holder, and CFPB director Richard Cordray sharply criticizing the ECMC-Corinthian deal and listing multiple specific problems with the proposed agreement. Our group, which includes the NAACP, League of United Latin American Citizens, Iraq Afghanistan Veterans of America, Student Veterans of America, AFL-CIO, Consumers Union, and many others, did so after extensive discussions between coalition representatives and Department of Education officials, as well as multiple conversations with ECMC executives, during which we expressed our strong concerns.

The deal had already been attacked by advocates for students on Capitol Hill. “I’m puzzled and upset by this outcome,” Senator Dick Durbin (D-IL) told Buzzfeed. “I can’t see how students get a break in this scenario. They’re now stuck in this debt collection university.” In the wake of the proposed sale, Durbin, Elizabeth Warren (D-MA), and eleven more Democratic senators have written to Duncan asking that his Department exercise its authority to discharge federal student loans for students with legal claims against Corinthian. Representatives Steve Cohen (D-TN), Raul Grijalva (D-AZ), and Mark Takano (D-CA-41), issued a statement noting that “ECMC has no prior experience operating institutions of higher learning, but,” as the New York Times reported earlier this year, “it does have a checkered history that includes using ruthless collection tactics against student loan debtors who should have reasonably qualified for bankruptcy relief.”

There are indeed real questions about whether ECMC has the corporate character and capacity to undertake the enormously complicated task of suddenly running one of the nation’s largest school systems. But no less concerning are (1) the nature of assets being acquired and (2) the proposed terms of the deal.

There are good programs and instructors, and many fine students, in the Corinthian chain; I have spoken with scores of well-intentioned teachers and staff in the past few years. But they have complained about a company that has sacrificed student outcomes to the company’s bottom line. Corinthian’s deceptive practices and poor record of student success has given many of its programs a weak reputation and left many of its students — people of color, single parents, veterans, and others struggling to build a future — deep in debt. That tarnished image increases the challenges for graduates in finding jobs in their chosen field. It also increases the challenges for any acquirer to recruit new students without engaging in the kind of deceptive marketing that has delivered students to Corinthian programs. It’s not at all clear that anyone, including ECMC, can turn the quality of programs around fast enough to effectively help enough of the current students, who total about 39,000, 51 percent of them studying exclusively online.

It’s thus doubtful that it makes sense to have a plan that depends on new students enrolling at these Corinthian campuses, as opposed to seeking educational opportunities elsewhere. Why would the Department of Education force taxpayers to invest in a risky scheme to prop up these campuses for perhaps decades to come, mostly just to avoid having to redirect the current students to new educational opportunities, especially at a time when various sectors of higher education have excess capacity?

Closing Corinthian programs and campuses will likely occur in California, where Attorney General Kamala Harris refused to agree, as other regulators have now agreed, to shield ECMC from financial claims for past harm to Corinthian students. Thus ECMC declined to buy those campuses, which operate as Everest schools and also under the brand Heald College (a once higher-quality, independent institution that Corinthian bought and promptly ruined, as Heald’s former president recently charged). Shuttering of campuses would create hardships for those students who like their current Corinthian programs, however overpriced they are. It also, of course, would cost many Corinthian employees their jobs. But Attorney General Harris is right to stand up; current and future students, and the country’s long-term interest, is best served without the current anti-student Corinthian-ECMC deal.

Many of the current Corinthian students were defrauded, and they deserve the option of getting their money refunded, or attending another school.

If the Department is reluctant to spend federal dollars on forgiving the Corinthian students’ loans, and if Corinthian’s collapse was hastened when the Department froze federal aid and the company claimed it was almost out of cash, it’s fair to ask where all the federal tax dollars sent to Corinthian are now. Santa Ana, California-based Corinthian, at its peak, was hauling in more than $1 billion a year in federal student grants and loans.

Corinthian CEO Jack Massimino took home more than $3 million a year.  He recently put on the market, listed at $11.5 million, his 10,000-square-foot, mountain-view second home in Park City, Utah; the listing says it is “Simply THE finest home in Kamas Valley and possibly the Intermountain West,” and it offers a heated horse barn, a “Children’s ‘Art Barn,’” and a pond on 61 acres.

The complaint against Corinthian filed by California AG Harris, one of many state and federal law enforcement actions taken against the company, alleges that Massimino and other “senior [Corinthian] executives” had “firsthand knowledge of the misconduct,” i.e., the deceptions at the center of Harris’s lawsuit.

Our coalition letter, the text of which is below, lists many of the glaring problems with the ECMC-Corinthian deal, but I will highlight two particularly bad ones:

First, ECMC has insisted on — and the Department of Education has not rejected — requiring students when they enroll to waive any right to pursue disputes in court; instead they must resolve matters through private arbitration. Such mandatory arbitration agreements, which strongly favor companies over individuals, are common when it comes to anti-consumer business like the credit card industry and — of course — the for-profit college industry.  The Department could, and should, demand that all recipients of federal student aid, including for-profit colleges, allow students who have been lied to, assaulted, or otherwise harmed by the institution, the option of a day in court.  Instead, with this agreement, the Department appears to be moving in the opposite direction, acquiescing in ECMC forcing harmed students into arbitration, even though it plans to run its school system as a non-profit; few, if any, non-profit colleges currently use mandatory arbitration clauses. Denying students such basic legal rights shields a college from accountability for treating its students fairly. ECMC executives’ insistence on arbitration may be revealing of how they really would operate the schools, however well-intentioned and public-spirited they believe they are now. And the Department of Education’s apparent acceptance of that position is another sign of its desperation to have someone take over these campuses before they fold — regardless of the harms and dangerous precedents.

Second, the agreement builds in an extraordinary conflict of interest for the Department of Education. ECMC has insisted it won’t pay more than $24 million up front. So in order to recoup some of the taxpayer investment, the agreement includes an “Earn Out” provision providing that ECMC’s new college subsidiary, Zenith, will pay the Department “up to $17.25 million ... over a seven-year period” based on a still-unspecified “percentage of funds that exceed targets specified by the Department.” In other words, the agreement would essentially give the Department an equity position, dependent on ECMC making a good deal of money.  What’s the problem with that? The Department is charged with overseeing ECMC’s conduct — that it is not engaged in predatory marketing, or leaving too many students defaulting on their loans, or lying to the Department itself. How can an oversight body have a financial stake in a company it is charged with regulating? It’s a blatant and unacceptable conflict. It could easily be avoided by ECMC, whose coffers are full of cash, ponying up a bit more money now. But the Department isn’t insisting on that, again suggesting its desperation to prevent these Corinthian campuses from failing.

Right now, at least two other huge for-profit college companies — ITT Tech and Education Management Corporation (EDMC, no relation to ECMC) — may be at serious risk of collapse, with declining enrollments, depleted share prices, and a pile of federal and state law enforcement investigations and lawsuits. Other big industry players are also in trouble.  Treating Corinthian as too big to fail, and thus sacrificing students and common sense, simply to find a buyer, any buyer, is a terrible course and a terrible precedent.  The time to stop this bad decision is right now.

Here’s the text of our coalition letter:

...

Sincerely,

Air Force Sergeants Association (AFSA)

AFL-CIO

American Association of University Professors Counseling (AAUP)

The American Association of State Colleges and Universities (AASCU)

American Federation of Teachers (AFT)

Center for Responsible Lending

Children’s Advocacy Institute

Consumer Action

Consumer Federation of California

Consumers Union

Covenant House

Demos

East Bay Community Law Center

The Education Trust

Generation Progress

Higher Ed, Not Debt

Housing and Economic Rights Advocates

The Institute for College Access & Success

Iraq and Afghanistan Veterans of America

The Leadership Conference on Civil and Human Rights

League of United Latin American Citizens

Military Officers Association of America (MOAA)

NAACP

National Association for College Admission Counseling

National Association of Consumer Advocates

National Consumer Law Center (on behalf of its low-income clients)

National Consumers League

National Education Association

One Wisconsin Now

Paralyzed Veterans of America

Project on Predatory Student Lending of the Legal Services Center of Harvard Law School

Public Advocates, Inc.

Public Citizen

Public Counsel

Public Law Center

Service Employees International Union (SEIU)

Student Debt Crisis

Student Veterans of America

United States Student Association

U.S. PIRG

Veterans Education Success

Veterans Student Loan Relief Fund

VetJobs

Vietnam Veterans of America

Woodstock Institute

Young Invincibles

This article also appears on Republic Report.

http://www.huffingtonpost.com/davidhalperin/declaring-corinthian-coll_b_6342124.html

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Sharon P. Robinson, the president and chief executive officer of the nonprofit American Association of Colleges for Teacher Education (AACTE) has served, since January 2011, on the board of directors of Corinthian Colleges, a publicly-traded corporation that runs the for-profit colleges Everest, Heald, and WyoTech. While Robinson’s organization advocates for strong professional teacher education, Corinthian has a record of poor-quality education programs, sold to students through deceptive recruiting, and the company is now under investigation by more than a dozen state attorneys general and at least four federal law enforcement agencies.

Corinthian College board members generally receive $60,000 per year in cash plus $90,000 in deferred stock. As a member of the board’s compensation committee, Robinson is entitled to an additional $10,000 per year, bringing her Corinthian compensation to $160,000. She earned $340,000 from her job at AACTE in 2012, the most recent reported year.

Robinson joined the Corinthian board in January 2011, at a time when the for-profit college industry was lobbying Congress and the White House intensely for the Obama administration to weaken its proposed “gainful employment” rule, aimed at cutting off federal aid to career education programs that consistently leave students with insurmountable debt. The industry has used a chunk of the $33 billion it receives each year from taxpayers to buy influential endorsers, and the presence of a well-credentialed education leader like Robinson on the Corinthian board could have been a useful selling point for industry lobbyists. The administration did end up issuing, in June 2011, a substantially weaker rule than was contained in its previous proposals. (The for-profit colleges then managed to get a federal judge to strike down the rule, forcing the administration to start over, which is why the fight over gainful employment is now again in full swing.)

Corinthian also has for years managed to keep mollified the private accrediting bodies that must certify its educational quality.  As accreditors have felt pressure from government regulators to get tougher on predatory institutions like Corinthian, having on the board a respected educator like Robinson, who previously served as U.S. Assistant Secretary of Education for the Office of Educational Research and Improvement, might have come in handy.

Santa Ana, Calif.-based Corinthian now faces a major lawsuit, filed last summer, from California attorney general Kamala Harris, who has charged that the company has engaged in “false and predatory advertising, intentional misrepresentations to students, securities fraud and unlawful use of military seals in advertisements.” In January, Corinthian disclosed that it had received a request for documents and information regarding its recruiting and business practices by a group of another thirteen state attorneys general (Arkansas, Arizona, Connecticut, Idaho, Iowa, Kentucky, Missouri, Nebraska, North Carolina, Oregon, Tennessee, Washington and Pennsylvania).

Federal investigators also are probing Corinthian. In June 2013, the Securities and Exchange Commission issued a subpoena to the company concerning student recruitment, degree completion, job placement, loan defaults and compliance with U.S. Education Department rules. In September 2013 Corinthian reported that the U.S. Justice Department is investigating claims that the company violated the False Claims Act with respect to its recruiting and financial aid practices and by, among other things, manipulating attendance records to keep federal aid for students no longer in attendance. In December 2013, the Consumer Financial Protection Bureau notified Corinthian that it expected to pursue legal action against the company for violation of federal laws with respect to private students loans. And in January, even the U.S. Department of Education, whose enforcement efforts have generally failed to address for-profit colleges abuses, moved toward taking tough measures with Corinthian, saying in a letter to the company that there were signs of “systematic deficiencies” in its operations and charging that the company “has admitted to falsifying placement rates and/or grad and attendance records at various institutions and because of ongoing state and federal investigations into serious allegations.”

Corinthian has denied all these allegations, but it has poor record of serving students. The company charges students $47,000 a year for an associates degree in business at Everest College in Florida, while the same program at nearby Miami Dade Community College costs $6,400. Two-thirds of Corinthian’s associate degree students drop out, three-quarters of former students can’t pay down their loans, and 36 percent default within three years, the highest rate of all publicly-traded college businesses. Corinthian gets almost 90 percent of its revenue from federal taxpayer dollars. Meanwhile, its CEO, Jack Massimino, has taken home  as much as $3 million a year in compensation, awarded by the board committee on which Robinson sits.

Corinthian is now in trouble.  Although the company tried to put on a happy face in recent reporting to investors, student enrollments are down, revenue is down, the stock price has declined. The company is laying off staff and recently cancelled its annual lavish party for executives and high-achieving employees. One market research company concluded in a report to investors in February, “simply put, we believe management is running out of options.”

Another Corinthian board member is National Urban League CEO Marc Morial, whose organization, which advocates for African-American opportunity, has received at least $1 million from Corinthian. The same month that Robinson joined the Corinthian board in 2011, Morial wrote an op-ed publicly criticizing the gainful employment rule. He joined Corinthian’s board last year. The predatory practices of for-profit colleges have disproportionately harmed students of color, as well as veterans.Former Secretary of Defense Leon Panetta joined the Corinthian board at the same time as Morial but resigned eleven weeks later, citing his busy schedule, after he was criticized.

Several education organization officials told me they are dismayed by Robinson’s presence on the board of predatory Corinthian, especially given her own organization’s mission of standing up for strong professional training and quality education — and because they respect her talents and achievements.

Sharon Robinson’s office told me she was unavailable to respond this week to my request for comment. Corinthian Colleges did not respond to my request for information on Robinson’s board service.

*This article also appears on Republic Report.

http://www.huffingtonpost.com/davidhalperin/head-of-teachers-college_b_5078769.html*

morial panetta:

http://www.huffingtonpost.com/davidhalperin/leon-panetta-quits-corint_b_3646152.html

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little sis

Jack Massimino Chairman of the Board and Chief Executive Officer, Corinthian...

• Board Member

Sharon Robinson President and CEO of the American Association of Colleges for...

• Director

Donors

The Walmart Foundation Wal-Mart foundation

- Grant ⋅ $500,000

Other Affiliations

Generation: A McKinsey Social Initiative 5 countries + 5 years + YOU = 1...

• Affiliation

--

http://www.republicreport.org/2014/law-enforcement-for-profit-colleges/

Corinthian Colleges (Everest, Heald, Wyotech) (company sold or shut down all campuses and declared bankruptcy 2015)

• State attorneys general investigation of Corinthian

Corinthian SEC 8-K, 01-27-14:

“On January 24, 2014, Corinthian Colleges, Inc. (the “Company”) was notified by the Iowa Attorney General’s office that it is leading an investigation by thirteen states (Arkansas, Arizona, Connecticut, Idaho, Iowa, Kentucky, Missouri, Nebraska, North Carolina, Oregon, Tennessee, Washington and Pennsylvania) into the Company’s business practices. The Company has received Civil Investigative Demands (“CIDs”) from most of those states that are substantially similar. The Iowa Attorney General’s office indicated that it will be the primary point of contact with the Company on behalf of all of the states involved in the investigation. The CIDs seek documents and answers to interrogatories related to the students recruited from the various states; organizational information; tuition, loan and scholarship information; lead generation activities; enrollment qualifications for students; complaints; accreditation; completion and placement statistics; graduate certification and licensing results; and student lending activities, among other matters. The Company is aware that several other companies in the for-profit education sector have received similar CIDs. The Company intends to cooperate with the inquiry.” https://www.sec.gov/Archives/edgar/data/1066134/000129993314000113/htm_49175.htm

Corinthian press release in conjunction with 3rd quarter earnings call, May 6, 2014:

“As reported in an 8-K on January 24, 2014,the Company was notified by the Iowa Attorney General’s office that it is leading an investigation by 13 Attorneys General into the Company’s business practices. In April, the Iowa AG notified the company that three additional states – Colorado, Hawaii and New Mexico, had joined the multi-state investigation, bringing the total to 16 states. The Company continues to cooperate with the investigation.”

http://investors.cci.edu/releasedetail.cfm?ReleaseID=845503

• Civil complaint against Corinthian filed by California attorney general, 10-10-13

“The People bring this action to hold Corinthian Colleges, Inc. and its subsidiaries that operate Heald, Everest and Wyotech schools (collectively “CCI”) accountable for violating California law by misrepresenting job placement rates to students, misrepresenting job placement rates to investors, advertising for programs that it does not offer, unlawfully using military seals in advertising, and inserting unlawful clauses into enrollment agreements that purport to bar any and all claims by students.”

https://oag.ca.gov/system/files/attachments/press_releases/Complaint%2C%20filed%20stamped_0.pdf

Corinthian answer to complaint, 11-12-13:

“The Government’s false allegations and the aspersions cast on the School’s relationship with its students are offensive and demeaning—to the School and its employees; to its students who are striving for a career and a better life; and to the employers who hire its thousands of qualified graduates.”

http://s3.documentcloud.org/documents/889232/corinthian-reply.pdf

U.S. Department of Education and California attorney general announcement, 11-17-15:

“… new factual findings by the U.S. Department of Education, which are the result of a joint investigation by the Department and the California Attorney General.  The Department of Education analyzed job placement rates at Everest and Wyotech Colleges, as well as additional evidence provided by Attorney General Harris, and concluded that placement rates were widely misrepresented to both enrolled and prospective students.

These findings will lead to enhanced and streamlined debt relief opportunities for thousands of former students at Everest College and Wyotech College campuses in California as well as students nationwide who attended Everest University online.”

https://oag.ca.gov/news/press-releases/attorney-general-kamala-d-harris-incoming-us-education-secretary-john-king

https://www.insidehighered.com/quicktakes/2015/11/17/breaking-feds-conclude-more-corinthian-campuses-misled-students

• Civil complaint against Corinthian filed by Massachusetts attorney general, 04-03-14

“We allege that this for-profit school aggressively recruited and misled students by falsely promising high quality, successful training programs, and instead left them with exorbitant student loan debt and without proper training or a well-paying career.”

http://www.mass.gov/ago/news-and-updates/press-releases/2014/2014-04-03-corinthian-complaint.html

• Civil complaint against Corinthian filed by Wisconsin attorney general, 10-27-14

“The State of Wisconsin brings this enforcement action against Defendant Corinthian Colleges, Inc., for its use of false, misleading and deceptive misrepresentations to induce students to enroll in its post-secondary school ‘Everest College, Milwaukee.’ Among Corinthian’s many misrepresentations were deceptive statements about critical facts such as the availability of externships in fields of study the school offered and job placement rates of the school’s graduates.”

http://www.doj.state.wi.us/media-center/2014-news-releases/october-27-2014

Corinthian SEC 8-K, 08-13-14:

“In January 2013, the Company received a request from the Wisconsin Department of Justice (the “WI AG’s Office”) for information and documents regarding the Company’s Milwaukee, WI campus that has been taught out. The request seeks records regarding the Company’s students enrolled at the Milwaukee campus since August 2009, including the enrollment process and outcomes achieved by the students, documents related to employers, externships, placement, completion, graduation, loans, marketing, advertisements, communications with state regulators and accrediting agencies, employees during the period, and other matters. On July 24, 2014, the WI AG’s Office sent a notice of intent to bring an enforcement action against the Company for purported violations of state consumer protection laws. The WI AG’s Office agreed to meet with the Company to discuss the allegations prior to filing suit. The Company is providing reasonable cooperation to the WI AG’s Office.”

http://www.sec.gov/Archives/edgar/data/1066134/000110465914060150/a14-18886_18k.htm

• Florida attorney general investigation of Corinthian

Corinthian SEC 8-K, 08-13-14:

“On October 19, 2010, the Company became aware of news stories which reported that the Florida Attorney General’s Office (the “FL AG’s Office”) had begun an investigation into certain private sector education companies in Florida, including the Company, seeking information on potential misrepresentations in financial aid, recruitment and other areas. On October 21, 2010, the Company received a subpoena from the FL AG’s Office seeking a wide range of documents from January 1, 2006 to the present. The Company’s attorneys have met with representatives of the FL AG’s Office multiple times and the Company has provided voluminous materials in response to the subpoena. Additionally, the Company has filed a motion to quash portions of the subpoena and for a protective order with respect to certain confidential and proprietary information. The Company expects to continue to provide reasonable cooperation to the FL AG’s Office.”

http://www.sec.gov/Archives/edgar/data/1066134/000110465914060150/a14-18886_18k.htm

• New York attorney general investigation of Corinthian

Corinthian SEC 8-K, 08-13-14:

“In May 2011, along with other private sector education companies, the Company received a subpoena from the New York Attorney General’s Office (the “NY AG”) seeking information on potential issues related to financial aid, admissions, students, securities and other areas. The Company is cooperating with the NY AG’s requests for information.”

http://www.sec.gov/Archives/edgar/data/1066134/000110465914060150/a14-18886_18k.htm

• Illinois attorney general investigation of Corinthian

Corinthian SEC 8-K, 08-13-14:

“In December 2011, after other private sector education companies had received similar requests, the Company received a civil investigative demand from the Illinois Attorney General’s Office (the “IL AG”) seeking information on potential issues related to financial aid, admissions, students and other areas. The Company has obtained protection of its confidential and sensitive business information and is cooperating with the IL AG’s reasonable requests for information.”

http://www.sec.gov/Archives/edgar/data/1066134/000110465914060150/a14-18886_18k.htm

• Minnesota attorney general investigation of Corinthian

Corinthian SEC 8-K, 08-13-14:

“On July 8, 2013, the Company received a civil investigative demand from the Minnesota Attorney General’s Office (the “MN AG”) seeking information on potential issues related to financial aid, admissions, students and other areas. The Company understands the MN AG is conducting inquiries into several other private sector colleges as well. The Company has obtained protection of its confidential and sensitive business information and is cooperating with the MN AG’s reasonable requests for information.”

http://www.sec.gov/Archives/edgar/data/1066134/000110465914060150/a14-18886_18k.htm

• Consumer Financial Protection Bureau lawsuit against Corinthian

Corinthian SEC 8-K, 01-06-14:

“As previously reported, in April 2012, Corinthian Colleges, Inc. …. was served with a Civil Investigative Demand (“CID”) from the U.S. Consumer Financial Protection Bureau (the ‘CFPB’). The CID, which was subsequently withdrawn by the CFPB and replaced with a substantially similar CID, contains extensive interrogatories and document production demands with the stated purpose to “determine whether a for-profit post-secondary company, student loan origination and servicing providers, or other unnamed persons have engaged or are engaging in unlawful acts or practices relating to the advertising, marketing, or origination of private student loans.  Although the Company objected to both CIDs by filing a petition with the CFPB, the Company has voluntarily provided documents and other information to the CFPB and has cooperated with the CFPB in its investigation. In December 2013, the Company received a letter from the CFPB notifying the Company that, in accordance with the CFPB’s discretionary Notice and Opportunity to Respond and Advise (“NORA”) process, the CFPB’s Office of Enforcement is considering recommending that the CFPB take legal action against the Company (the “NORA Letter”).  The NORA Letter states that the staff of the CFPB’s Office of Enforcement (the “Staff”) expects to allege that the Company violated the Consumer Financial Protection Act of 2010, 12 U.S.C. §5536.  The NORA Letter also states that if such action is brought the CFPB may seek injunctive and monetary relief against the Company.  The NORA Letter confirms that the Company has the opportunity to make a NORA submission, which is a written statement setting forth any reasons of law or policy why the Company believes the CFPB should not take legal action against it. The Company understands that a NORA notice from the Staff is intended to ensure that potential subjects of enforcement actions have the opportunity to present their positions to the CFPB before an enforcement action is recommended or commenced.  The Company intends to make a NORA submission to the CFPB, and continues to believe that its acts and practices relating to student loans — financing that is essential to preserving our students’ access to post-secondary education — are lawful. The Company cannot provide any assurance that the CFPB will not ultimately take legal action against it or that the outcome of any such action, if brought, will not have a material adverse effect on the Company’s financial condition and results of operations.”

https://www.sec.gov/Archives/edgar/data/1066134/000110465914000595/a14-1250_18k.htm

Corinthian SEC 8-K, 08-25-14:

“On August 21, 2014, the Company’s lawyers met with attorneys for the U.S. Consumer Financial Protection Bureau (the “CFPB”), and subsequently received a letter memorializing certain aspects of the discussion, in which the CFPB asserted violations by the Company of the Dodd-Frank Act and the Fair Debt Collections Practices Act [sic] indicated its willingness to engage in settlement discussions with the Company, so long as the Company would agree to certain conditions.  These conditions include (i) providing certain financial disclosure materials, (ii) ceasing the sale or transfer of private student loans, (iii) ceasing to engage in certain in-school collection efforts the CFPB considers unlawful, (iv) providing students and prospective students with the same disclosures regarding the potential sale of certain campuses that the Company has provided to California students as part of an agreement with the California Attorney General, and (v) notifying the CFPB of any indications of material interest in purchasing any of the Company’s assets.  The CFPB also requested certain documents relating to a recently-completed sale of student notes … and certain information relating to the student loans that the Company continues to hold and any private lending arrangements to which the Company is currently a party.  The CFPB provided the Company until August 29, 2014 to indicate whether it would agree in principle to such conditions.”

https://www.sec.gov/Archives/edgar/data/1066134/000110465914062927/a14-19968_18k.htm

CFPB federal court complaint against Corinthian, 09-16-14:

“Corinthian induced students to enroll in its programs through false and misleading representations about its graduates’ career opportunities …”

http://files.consumerfinance.gov/f/201409_cfpb_complaint_corinthian.pdf

Default judgment against Corinthian entered by U.S. District Court, 10-27-15:

“Plaintiff is entitled to an Order imposing permanent injunctive relief and declaratory relief, and requiring Corinthian to make restitution of $531,224,267 to the borrowers of the private loans that are the subject of this action….

Based on the well-pled allegations of the Complaint, which are taken as true, Defendant Corinthian has violated the CFPA’s prohibition on deceptive practices, 12 U.S.C. § 5536(a)(1)(B), by misrepresenting career prospects and career services available to Corinthian students and prospective students in order to induce them to enter into Genesis Loans …. Defendant Corinthian has violated the CFPA’s prohibition on unfair practices, 12 U.S.C. § 5536(a)(1)(B), 12 U.S.C. § 5531(c)(1), by causing substantial injury to Genesis Loan borrowers by barring or pulling them from class, withholding educational resources, and otherwise preventing them from gaining access to educational courses or materials for which they had already paid, in order to pressure them to pay their Genesis Loans…. Defendant Corinthian has violated the FDCPA, 15 U.S.C. § 1692d, by engaging in harassing, oppressive, or abusive conduct against Genesis Loan borrowers in connection with the collection of debts from the Genesis Loans.”

http://www.republicreport.org/wp-content/uploads/2015/06/corinthian-default-judgment.10.27.15.pdf

• Justice Department False Claims Act investigations of Corinthian

Corinthian SEC 10-K, 09-03-13:

“On April 11, 2011 the Company’s Everest Institute in Jonesboro, Georgia was sent a subpoena from the Atlanta office of ED’s Office of Inspector General (the “OIG”) requesting documents related to the Jonesboro campus’s employment and placement rates reported to its accrediting agency, as well as correspondence with the accrediting agency. The Company has become aware that this matter is being supervised by an Assistant United States Attorney for the Northern District of Georgia who focuses primarily on civil False Claims Act matters, including qui tams. The Company does not know whether a qui tam action has been filed under seal or whether the United States Attorney’s Office has made a determination about whether to file a False Claims Act lawsuit in this matter. Additionally, the Company has also received inquiries from the Department of Justice and the Assistant U.S. Attorney involved in reviewing the previously-disclosed Lee qui tam matter regarding the Company’s attendance procedures. The Company infers, but has been unable to confirm, that these inquiries may relate to one or more additional qui tams filed under seal that may be pending the government’s investigation and intervention decision. Separately, on April 24, 2012, a complaint captioned United States of America ex rel. Carolina Marion v. Heald College Inc. and Corinthian Colleges Inc. was filed under seal in the U.S. District Court for the Northern District of California. Since the complaint was filed under seal, the Company has not been able to obtain a copy of the complaint but infers that this too is a qui tam action brought under the False Claims Act. The Company has also received an inquiry from the Assistant U.S. Attorney apparently involved in reviewing the Marion matter regarding attendance procedures at the Heald Salinas campus.”

https://www.sec.gov/Archives/edgar/data/1066134/000104746913008803/a2216385z10-k.htm

Corinthian SEC 10-K, 09-26-14:

“[I]n late August 2014 the Company received a civil investigative demand (the “CID”) from the United States Department of Justice, Civil Division, as part of a False Claims Act investigation concerning allegations related to student attendance and grade record manipulation, graduate job placement rate inflation and non-Title IV funding source misrepresentations. The CID requires the Company to provide written answers to interrogatories, documents, and testimony. The Company intends to cooperate with this investigation.”

https://www.sec.gov/Archives/edgar/data/1066134/000110465914068525/a14-21560_18k.htm

• Justice Department subpoenas to Corinthian

Corinthian SEC 8-K, 08-12-14:

“On August 8, 2014, the Company received a grand jury subpoena for documents from the United States Attorney’s Office in the Central District of California. The subpoena seeks documents and records relating to matters including job placement representations, graduation rates, transferability of credits for the Company’s students, advertisements and marketing materials, and representations regarding financial aid, military connections, student loans, and defaults by Corinthian’s students, as well as related statements to investors and disclosures in the Company’s public filings with the SEC. The Company is evaluating the subpoena and intends to cooperate fully with the request.”

http://www.sec.gov/Archives/edgar/data/1066134/000110465914060150/a14-18886_18k.htm

“Federal prosecutors in California, Florida, and Georgia have all issued grand jury subpoenas to the company.”

https://www.insidehighered.com/quicktakes/2014/09/29/corinthian-facing-another-federal-investigation

• Securities and Exchange Commission subpoena to Corinthian

Corinthian SEC 8-K, 06-10-13:

“On June 6, 2013, Corinthian Colleges, Inc. (the “Company”) received a subpoena from the Securities and Exchange Commission (“SEC”).  In a letter accompanying the subpoena, the SEC stated that it is conducting an investigation of the Company.  The SEC’s subpoena requests the production of documents and communications that, among other things, relate to student information in the areas of recruitment, attendance, completion, placement, defaults on federal loans and on alternative loans, as well as compliance with U.S. Department of Education financial requirements, standards and ratios (including the effect of certain borrowings under the Company’s credit facility on the Company’s composite score, and 90/10 compliance), and other corporate, operational, financial and accounting matters.  The Company intends to cooperate with the SEC in its investigation.”

http://www.sec.gov/Archives/edgar/data/1066134/000110465913048089/a13-14724_18k.htm

• Department of Education actions regarding Corinthian

Department of Education letter, 01-23-14:

“The Department has denied approvals for certain new locations and new programs because CCI has admitted to falsifying placement rates and/or grade and attendance records at various institutions and because of ongoing state and federal investigations into serious allegations with respect to CCI’s improper administration of Title IV programs….. [T]he issues just referenced suggest systematic deficiencies in the operations of CCI…. Because of these concerns, the Department will not approve CCI’s Title IV growth through the addition of any new locations opr programs going forward until the Department ascertains whether CCI and its institutions possess the requisite administrative capability to ensure compliance with all Title IV program requirements.”

https://www.documentcloud.org/documents/1014987-corinthian-colleges-inc.html

Corinthian response, SEC 8-K, 02-05-14:

“The Company disputes ED’s characterization that the Company admitted wrongdoing, but plans to cooperate with ED in its review.   The Company believes ED is referencing isolated instances over a four-year period when the Company detected erroneous information, took corrective action and reported its findings to regulatory authorities.”

http://investors.cci.edu/secfiling.cfm?filingID=1104659-14-6539&CIK=1066134

Department of Education press release, 06-19-14:

“The U.S. Department of Education’s Federal Student Aid (FSA) office has placed Corinthian Colleges Inc. on an increased level of financial oversight after the company failed to address concerns about its practices, including falsifying job placement data used in marketing claims to prospective students and allegations of altered grades and attendance…. The Department has requested data from Corinthian multiple times in the last five months to address inconsistencies in the company’s job placement claims for graduates, but Corinthian officials have not turned over the documents.”

http://www.ed.gov/news/press-releases/us-department-education-heightens-oversight-corinthian-colleges

July 3, 2014, agreement between the Department of Education and Corinthian under which Corinthian will sell most of its campuses and wind down operations at all others — Department of Education press release, 07-03-14:

http://www.ed.gov/news/press-releases/us-department-education-accepts-operating-plan-corinthian-colleges-inc

Corinthian SEC 8-K, 07-07-14:

http://www.sec.gov/Archives/edgar/data/1066134/000110465914050216/a14-16628_18k.htm

Corinthian SEC 8-K, 08-25-14:

“On August 22, 2014, the Company received a letter from ED in which it denied recertification of Everest Cross Lanes, citing alleged misrepresentations and breach of fiduciary duty at the Decatur campus that was an additional location of Everest Cross Lanes until 2013.”

https://www.sec.gov/Archives/edgar/data/1066134/000110465914062927/a14-19968_18k.htm

Department of Education letter imposing $30 million fine, 04-14-15:

“[T]he Department’s findings demonstrate that Heald College failed to meet the fiduciary standard of conduct by misrepresenting its placement rates to current and prospective students and to its accreditors, and by failing to comply with federal regulations requiring the complete and accurate disclosure of its placement rates. Therefore, as described below, I have determined that due to the serious violations committed by Heald College, a fine in the amount of $29,665,000 is warranted.”

http://www2.ed.gov/documents/press-releases/heald-fine-action-placement-rate.pdf

Dade Medical College (school closed 2015)

==

omg

fang intercept

https://theintercept.com/2015/05/04/bankruptcy-filing-shows-corinthian-colleges-secretly-funded-d-c-think-tanks-dark-money-election-efforts/

The spectacular crash of Corinthian Colleges after years of systematically deceiving thousands of students into enrolling into low-quality, high-cost education programs has once again raised questions about how the for-profit college industry staved off stronger rules governing the$1.4 billion per year in federal loans that helped keep Corinthian afloat.

Some hints emerged today in the giant chain’s filing for Chapter 11 bankruptcy protection in Delaware. It shows that Corinthian made secret payments to an array of political consultants, think tanks and political dark money groups.

The filing doesn’t list amounts, but shows that Corinthian made payments to Crossroads G.P.S., a group co-founded by Karl Rove that has raised over $300 million to elect Republican members of Congress through campaign advertising. Crossroads G.P.S., a 501(c)(4) nonprofit, does not disclose any of its donors.

Crossroads G.P.S. spent over $700,000 to help elect Sen. Marco Rubio, R-Fla., during his 2010 election. As Bloomberg News revealed, Rubio later filed a letter with the Department of Education, requesting that the agency “demonstrate leniency” with Corinthian.

Corinthian registered only two lobbying firms last year — Akin Gump Strauss Hauer & Feld LLP and Akerman LLP. But the filing shows that Corinthian also paid a myriad of other consulting firms that work to influence the political process.

Corinthian’s creditor list includes: TheGroup DC LLC, a public affairs firm founded by Art Collins, an advisor to Barack Obama’s 2008 election; Stanton Communications Inc., a firm that specializes in “crisis management”; and Strategic Partnerships LLC, a Virginia-based public affairs company founded by Kenneth Smith, a former Reagan administration advisor who now serves as the president of Jobs for America’s Graduates, Inc.

APCO Worldwide, a lobbying firm, is among the Corinthian creditors, though the firm never registered to represent Corinthian under the Lobbying Disclosure Act.

The listing reveals a number of payments to influential D.C. groups that have battled regulations on the for-profit college industry. TheU.S. Chamber of Commereis listed multiple times as a Corinthian creditor. The Chamber has run campaign advertisements on behalf of opponents of the Department of Education’s “gainful employment” regulation, which would measure the performance of vocational programs. The Chamber made defeating the rules a top priority.

The American Legislative Exchange Council, a nonprofit that helps corporate interests draft model legislation, is listed as a creditor.As Republic Reportreported, although for-profit colleges are far more expensive for programs offered by community colleges and other public institutions, ALEC drafted a resolution calling for state officials to “recognize the value of for-profit providers.”

Another gainful employment regulation opponent, the American Enterprise Institute, is listed as a Corinthian creditor.AEI scholars have repeatedly attacked the rules, calling them an example of the Obama administration’s “crusade against for-profit colleges.” Last October, Andrew Kelly, AEI’s resident scholar on higher education reform, specifically defended Corinthian and criticized the “Obama administration’s bloodlust for such schools.”

Payments are listed for current and previous board members to Corinthian, including former Defense Secretary Leon Panetta, Urban League President Marc Morial, and Sharon Robinson, president and chief executive officer of the non-profit American Association of Colleges for Teacher Education. Payments are also listed directly to the Panetta Institute and Morial’s National Urban League.

Corinthian allegedly lied to students by providing bogus job-placement statistics, misled accrediting agencies by claiming unemployed graduates were employed, and steered students to in-house loans for bachelor’s programs with a price tag as high as $75,384.Though Department of Education rules state that students do not have to make loan payments while attending school, the Miami Herald reported that Corinthian “frequently demanded that its students pay while attending classes” and were publicly shamed through classroom removals if they did not pay.

“This is public money that’s going into a for-profit college, that then is used to fund organizations that do lobbying work and other PR work on behalf of this company,” says Ann Larson, an organizer with the Debt Collective, a group pushing for loan forgiveness for Corinthian students who say they were defrauded.  “In the end, Corinthian can file for bankruptcy while tens of thousands of students, most of them low-income, are stuck with this debt.”

“It’s certainly not surprising that the corporate and political elites managed to come up with this scam,” Larson said.

Ken Smith

President & CEO, Jobs for America's Graduates, Inc. (JAG)

Mr. Kenneth M. Smith serves as President and CEO of Jobs for America’s Graduates, Inc. (JAG), the nation’s largest, most

consistently applied model of

dropout prevention and school

-

to

-

career transition for at

-

risk young people of great promise.

In 1979, Mr. Smith worked with Governor Pete du Pont of Delaware on the design of the first statewide test of the JAG Model,

and

has served as President and CEO

since its inception.

JAG currently serves 48,000 at

-

risk young people annually, in more than 1,000

high schools in 32 states.

Over one million youth have been throughout JAG’s 35 year history.

The non

-

profit JAG national Board of Directors is chaired

by Governor Phil Bryant of Mississippi.

It includes among its 50

members

—

nine Governors and several executives of major corporations and business and community organizations.

In recognition of his knowledge of national employment and training issues, thr

ee Presidents have appointed Mr. Smith to national

commissions.

He was appointed in 1981 and again in 1983 by President Reagan as Chairman of the National Commission for

Employment Policy.

Designed to analyze the full range of government policy related t

o employment, the Commission continues with

a $2 million annual appropriation and a 15

-

member professional staff.

Mr. Smith also accepted an appointment by President Reagan

to the National Advisory Council on Vocational Education, where he had previously

served under appointment by President

Ford.

President Nixon appointed Mr. Smith as Vice Chairman of the National Advisory Council on the Education of Disadvantaged

Children for the period 1973

-

76.

Mr. Smith is also Chairman and Chief Executive of Strategi

c Partnerships LLC.

Prior to founding JAG, Mr. Smith served as staff aide to President Nixon (1969

-

70); as Director of Special Projects for the

Distributive Education Clubs of America; and founder and President of 70,0001 Ltd., a nonprofit organization de

dicated to helping

high school dropouts obtain employment.

Thereafter, he served in a new post as Senior Advisor to the Governor of Delaware on all

activities related to education at the secondary and postsecondary levels.

During this period, he chaired

the Commission of the Future

of Education in Delaware and was nominated to serve as the Chairman of the Board of Trustees of Delaware Technical College.

Mr. Smith serves as a Trustee of the America’s Promise Alliance, founded in 1997 with General Colin Po

well as Chairman and

chaired today by Alma Powell, is a cross

-

sector partnership of more than 300 corporations, nonprofits, faith

-

based organizations and

advocacy groups that are passionate about improving lives and changing outcomes for children.

Mr. Smi

th holds a Bachelor of Arts in International Relations from the School of International Science at American University

==

ref above mostly ok?

Obama’s scattershot higher education plan

Some decent ideas, some bad ones, and all will be hard to execute properly.

Frederick M. Hess, Andrew P. Kelly

August 26, 2013 4:00 am | National Review Online

No politician has ever lost points for attacking high tuition. Taking that lesson to heart, President Obama went after excessive college costs last week, and then kept on going. In the end, he sketched a kitchen sink full of ideas intended to “shake up” higher education — some not quite ready for prime time, and some just subprime.

Obama’s big idea is to base colleges’ eligibility for student aid on how well they fare in new federal ratings that will compare institutions against their peers on things like low-income enrollment, tuition prices, debt loads, degree-completion rates, and labor-market outcomes. Students who attend highly rated colleges would be entitled to larger Pell Grants and lower interest rates on their loans.

Conceptually, linking outcomes to eligibility for public funds is an idea worthy of consideration. For half a century, Uncle Sam has offered grants and loans intended to defray steadily increasing tuition bills, while encouraging students to enroll anywhere they want. The expectation was that institutions would compete to provide the best education at the lowest price.

That didn’t work so well. Colleges spent more, relying on generous aid programs to help students afford the tuition. As prices climbed, policymakers expanded student-aid programs. The result: Student-loan debt today exceeds $1 trillion, and about 20 percent of borrowers are not repaying their loans.Every year, tens of thousands of students enroll in colleges from which they have a ridiculously small chance of graduating, with more than half of them doing so on the taxpayer’s dime.

The president got a second big thing right, too. Students have a responsibility in all this, one that pandering pols have too rarely addressed. Obama called for requiring aid recipients to complete a set percentage of their classes in order to be eligible for continued aid. That’s hardly a sufficient call for student responsibility, especially from an administration that has instituted loan forgiveness for graduates who become public employees, but it’s a step in the right direction.

All that said, it’s not clear that the conceptual appeal of the president’s accountability proposal can be translated to practice. Linking eligibility for aid to student outcomes without accounting for the “value added” by individual colleges would create a massively tilted playing field, one that would advantage elite, selective institutions. No one has any idea how to calculate value-added for colleges, and there would be vast opportunities to game the system. Oh, and the federal government is prohibited from collecting key data points under an existing 2008 law.

Some of the president’s other ideas missed the mark. This was especially true in the case of innovation and student-debt relief. Obama called for “challenging” college leaders to adopt “promising practices” like awarding credit for learning rather than time spent in class, redesigning courses using technology, and enhancing student services. That’s all well and good, but colleges have a long record of rolling new bells and whistles into their existing bundle of services, changing little or nothing about their business model, andusing any savings to add diversity coordinators and minimize faculty teaching loads. Meanwhile, Obama’s call for regulatory “waivers” to allow for more experimentation might work if the administration avoids its penchant for using waivers to prescribe particular pet reforms and for riding roughshod over statutory constraints.

Even more troubling was Obama’s call for expanding an income-based repayment system that creates perverse incentives for students and institutions and leaves taxpayers footing the bill. Under Obama’s “Pay as You Earn” program, qualifying students pay 10 percent of their income for a specified period. After that, loans are forgiven — even for borrowers with immense graduate-school debts and hefty incomes. Earlier this month *Politico*reported that Georgetown Law School had figured out how to exploit the public-service loan-forgiveness component of Obama’s “Pay as You Earn” system to ensure that its students don’t have to “pay a single penny on their loans” — while leaving taxpayers with the tab. Expanding this program even further will only add to the college-cost problem.

The president’s tendency to gravitate toward new executive prerogatives makes it harder than it should be to support even his good ideas. After all, this is the same administration that used a single phrase from legislation passed in the 1970s — “gainful employment” — to launch a crusade against for-profit colleges. The push to hold all colleges accountable for what they do with taxpayer funds is long overdue. But the devil is still very much in the details. Given that the good ideas are not well thought out and the bad ones are counterproductive, it’s just as well that this is largely an exercise in political theater.

— Andrew P. Kelly is director of the American Enterprise Institute’s Center on Higher Education Reform and the co-editor of the forthcoming volume “Stretching the Higher Education Dollar.” Frederick M. Hess is director of education-policy studies at the American Enterprise Institute.

This article was found online at:

https://www.aei.org/publication/obamas-scattershot-higher-education-plan/

==

A real education market

Andrew P. Kelly

October 21, 2014 12:54 pm | National Review

In mid June, the Department of Education put for-profit Corinthian Colleges out of business. Citing the company’s failure to respond to claims it had fudged job-placement data and falsified attendance records, the department placed a 21-day hold on any additional federal loan and grant money due the institution.Corinthian’s 107 colleges — serving 72,000 students under the Heald, Everest, and Wyotech brands — draw 83 percent of their revenue from federal sources, and the firm was already reeling from two years of declining enrollment and a dozen state-level investigations. Despite Corinthian’s $1.6 billion in revenues in 2013, the department’s hold left it without enough cash to pay the bills. In early July, the firm agreed to sell most of its campuses and close the rest.

The announcement sent a shock through the for-profit sector. The Obama administration’s bloodlust for such schools had put the industry on its heels since 2009. But before June, none of them had been effectively forced out of business by the government. Education Department officials themselves must have realized that they had overstepped, and feigned ignorance that the hold would be the final nail in Corinthian’s coffin.

Many conservatives were understandably outraged by the administration’s coup de grâce. The Wall Street Journal editorial page called it an “extraordinary violation of due process . . . akin to a judge issuing the death penalty while a case is in discovery.” Economist Richard Vedder called it an “ideological victory at the expense of many poor younger Americans.” A longtime Wells Fargo analyst of the sector called it a “chilling and aggressive new level of oversight.”

These critics are right to question the administration’s ideological campaign — more witch hunt than reform effort — against private enterprise in education.Still, it is also hard to ignore the incongruity here: Since when are conservatives the staunchest defenders of a company that takes nearly all of its revenue from taxpayers, let alone one that is known to charge substantial sums for a shoddy product? As of 2012, nearly 30 percent of Corinthian students defaulted on their federal loans within three years of entering repayment, and a 2013 investigation found that campuses had boosted job placement numbers bypaying temp agencies $2,000 to hire their graduates for short stints.

Two things can be true simultaneously: First, the department’s execution of Corinthian was an ideologically motivated and inappropriate use of federal power. Second, any rational market would have driven many of Corinthian’s programs out of business long ago. Indeed, perhaps the most telling aspect of the Corinthian saga is that it takes unprecedented federal overreach to drive a poorly performing college out of business.

The bigger problem is that for every Corinthian College there are literally hundreds more — public, nonprofit, and for-profit alike — that fail students and taxpayers but operate just below the radar. Thousands more charge far too much for a mediocre product, saddling students with debt that outweighs the value of what they were taught.

It’s time to ask why we subsidize so much failure in American higher education, and what we can do about it. Our goal should be to change the incentives that allow colleges— and not just the for-profit ones, but all of them — to survive and even thrive regardless of whether they deliver anything of value.

From the outside, federal higher-education policy looks like a conservative Shangri-La: Aid is given out as a voucher, and students can choose any college they want, including private institutions. Private accreditation agencies are tasked with ensuring academic quality, keeping government regulators at arm’s length. Ideally, market forces should reward good colleges and force the bad ones out of business, with accreditation agencies setting minimal standards: a model of market-based social policy.

But this market has been less successful in reality. Colleges have capitalized on goodwill, federal largesse, and hands-off regulation by doing whatever they please. That has included charging ever-higher tuition to finance ever-larger campuses while paying little attention to how their students fare once they enroll.

Unfortunately, the students aren’t faring particularly well. Evidence suggests that college students spend ten fewer hours studying per week today than they did in the 1960s. When two researchers tracked student learning at four-year colleges, they found that more than one-third made no perceptible gains in critical thinking between their freshman and senior years.

Nationally, just over half of all students who start a degree or certificate program finish a credential within six years, and those with some college but no degree now earn about as much as their high-school-educated peers. While those who graduate are better off, they are often unprepared for the world of work. The New York Fed found that 44 percent of recent college graduates were working jobs that did not require a college diploma in 2012, a fraction that has been on the rise since 2000.

All of this failure costs a whole lot more than it used to. Tuition prices at public four-year colleges have nearly quadrupled since the early 1980s, and the federal government now hands out $170 billion a year in grants, loans, and tax credits. Students are borrowing more than ever to finance college, but earnings have not kept pace. The effective delinquency rate on student loans is now as high as it was on subprime mortgages at the height of the housing crisi

If you ask progressives, many will tell you that for-profits are to blame for these troubling trends. For instance, in a recent New York Times op-ed, Cornell professor Suzanne Mettler argued that “tougher regulations of the for-profits, long overdue, are the quickest way to help the poorest Americans who seek college degrees.”

But the notion that problems are limited to a particular tax status — and one covering schools that enroll only about 12 percent of higher-ed students — is nonsense. According to the latest federal data, borrowers from 488 of the colleges eligible for federal student aid had three-year default rates of 25 percent or higher. True, the majority of those schools were for-profit, but 166 were public institutions and 40 were private nonprofits. When it comes to graduation rates at two- and four-year colleges, there is no shortage of embarrassing results. In 2012, 681 public colleges had graduation rates of less than 25 percent, a mark matched by 165 for-profits.

No, the problem is much deeper and more insidious than tax status alone. It’s a function of colleges’ self-interest and the flawed federal policies that indulge them. Democrats argue that for-profit colleges’ interest in maximizing revenue encourages bad behavior. What they fail to realize is that all colleges operate according to self-interest. Public and nonprofit institutions may not be out to maximize revenue per se, but they work instead to maximize prestige and influence. These colleges operate under what economist (and former president of the University of Iowa) Howard Bowen called the “revenue theory of costs”: They raise all the money they can and spend all the money they raise. And because the quest for prestige is open-ended, public and nonprofit colleges will tend to seek never-ending increases in spending, financed by never-ending fundraising and never-ending increases in tuition.

But maximizing prestige may have little to do with the quality of the education students receive. In fact, since measures of student learning don’t factor into popular rankings or public-funding formulas, there’s little reason to invest in great teaching. University of Michigan economist Brian Jacob and his colleagues have found that outside of the highest achievers, students tend to choose campuses that spend the most on amenities, not the ones that spend the most on instruction. Of course, the same problem applies to the for-profits: Building the best recruiting and marketing departments will attract students and revenue, but it won’t help them learn anything.

Higher-education policy could try to change these incentives. But the federal student-aid system seems tailor-made to serve the interests of colleges. The problem is threefold.

First, federal aid programs encourage any high-school graduate to enroll in any accredited institution at any price. With no underwriting of any kind, federal loans provide no signal as to the expected value of a given program. A generous federal loan program for parents, which allows borrowing up to the cost of attendance, helps ensure that students will have the money to pay tuition bills. And access to easy credit gives colleges every incentive to enroll students. Whether they succeed or not, colleges are paid in full.

Second, prospective consumers have difficulty judging the quality of different options. Some of this is unavoidable; college is hard to evaluate until it is actually experienced. But some of these blind spots are self-inflicted. Basic pieces of information needed to make a sound investment — out-of-pocket costs, the proportion of students who graduate on time, the share who earn enough to pay back their loans after graduation — are either incomplete or nonexistent. That’s due, in part, to a 2008 law that prohibited the federal government from collecting data on all college students. Championed by the private-college lobby and congressional Republicans, the ban keeps useful (and potentially embarrassing) information — things like graduation rates, debt, and post-college earnings — out of the public eye. As a result, prospective students typically have no idea whether a given program will be worththeir while and are easily wooed by flashy amenities, high tuition prices, and promises of a high salary.

Information gaps would be less problematic if we could count on the accreditation agencies that serve as gatekeepers for federal aid programs to hold colleges accountable. Therein lies the third problem: Rather than protecting consumers, accreditation actually keeps poor-performing colleges in business. Accreditation is a process of peer review. Faculty from other campuses evaluate peer institutions, and accreditation agencies finance their operation with dues from the colleges they accredit. It is also a binary variable — you are either accredited or you’re not. Because federal aid is the lifeblood of colleges, the consequences of revoking accreditation are incredibly severe, with the result that accreditors are reluctant to go that far.

Together, these three structural problems have created a system in which poorly performing colleges that would never pass muster in a functioning market are rarely stripped of their access to federal aid. That aid, in turn, encourages consumers to buy substandard products they would otherwise avoid.

Conservatives typically respond to these problems with familiar calls to do away with federal aid entirely. But without any federal aid, we’d face the under-provision problem we started with: Many low-income students who would benefit from post-high-school education could not afford it. Phasing out federal aid would certainly lead to a drop in prices, but it’s not clear that the market alone would ensure equal opportunity for all qualified students.

In the absence of serious efforts to change the incentives for colleges, Republicans have ceded this ground to Democrats. As the existing system continues to deteriorate, progressive proposals to create an elaborate system of federal college ratings or a federally funded “public option” will get serious consideration. Conservatives who want to maintain and improve the market-based system must present their own set of solutions. Two ideas stand out.

The most direct way to align the interests of colleges with those of students and taxpayers is to give colleges “skin in the game” when it comes to student loans. Currently, colleges can enroll any high-school graduate with a pulse because they bear almost none of the risk that the student will fail. They’re held harmless unless and until more than 40 percent of their borrowers default on federal loans within three years. Default rates are easily gamed, though, and if students default after three years, the college gets off scot-free. Last month, the Department of Education went so far as to “adjust” some schools’ default rates at the eleventh hour in order to save them from losing aid eligibility.

As my American Enterprise Institute colleague Alex Pollock has argued, when mortgage lenders operated under a similar set of incentives — handing out risky loans, bundling them up, and then selling them to investors, thereby shedding the risk — the result was the subprime-mortgage crisis. “A principal lesson from mortgages, nearly universally agreed upon, is that those who create the mortgages should retain a material part of the credit risk,” Pollock wrote in 2012. It is a lesson that he argues we should extend to higher education.

The simplest approach would be to make colleges responsible for paying back a fixed percentage of the loans their students default on. A clear, objective risk-sharing policy would hit colleges where it hurts — their budget — and would not be all-or-nothing like current default-rate regulations or the accreditation system.

Democratic senators Jack Reed, Dick Durbin, and Elizabeth Warren have introduced legislation that would force colleges with high default rates to pay back a share of defaulted loans. But here again, Democrats would rather play favorites than hold all colleges to account. The bill includes exemptions for historically black colleges and universities and for community colleges, schools that have default rates higher than the national average. And the proposal would cover only campuses where more than 25 percent of students take out loans. In other words, Democrats believe that only a subset of colleges should have skin in the game.

Excluding groups of colleges from risk sharing would be akin to exempting some mortgage lenders from regulation because they lend to subprime clients. We know how such lenders behaved when they had no skin in the game, and it wasn’t pretty. A better way to avoid unintended consequences would be to couple risk sharing with rewards for serving low-income students well. For instance, the feds could provide colleges with a cash bonus for every Pell Grant recipient they graduate, providing schools with an incentive to lift students out of poverty.

The second way to align the interests of colleges, students, and taxpayers is to provide consumers of higher education with the information they need to make informed decisions. In K–12 education, Republicans have been the party of transparency and accountability. The No Child Left Behind Act failed on many fronts, but it did compel states to collect and publish valuable information on the performance of public schools. When it comes to higher education, though, many congressional Republicans have stood in the way of similar ideas, not only rejecting the Bush administration’s recommendation to collect better federal data but banning such collection outright. This policy has left consumers in the dark when it comes to basic facts about their options, leading to bad investments and stunted market discipline.

Not all Republicans have toed the line. Senator Marco Rubio (Fla.) teamed up with Democrat Ron Wyden of Oregon to propose the Know before You Go Act, which would require the federal government to collect data on graduation rates, debt, and post-college earningsand publish that information for each program a college offers. Without support from other conservatives, however, these efforts to empower and protect consumers will go nowhere.

Some might argue that skin-in-the-game and transparency reforms represent an expansion of federal power. Conservatives should strenuously disagree. Skin in the game is not an expansion of the federal role, but a way to ensure that federal investments don’t go to waste. This sort of arrangement is standard in other policy areas. In the food-stamp program, for example, if local agencies dole out too many benefits in error, states must pay financial penalties to the federal government. Since that policy was instituted, food-stamp error rates have plummeted.

Likewise, the federal government is the only entity that can systematically track and publish information on post-college earnings and debt. Some states have tried admirably, but they can’t follow graduates across their borders. Put simply, better consumer information is a public good without which the market will continue to fail.

Rather than micromanaging colleges from Washington, these reforms would compel them to consider taxpayers and students’ interests as well as their own. Conservatives should welcome such a change.

– Andrew P. Kelly is a resident scholar at the American Enterprise Institute, whose Center on Higher Education Reform he directs. This article originally appeared in the October 20, 2014 issue of National Review.

This article was found online at:

https://www.aei.org/publication/real-education-market/

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ref by fang

tom d CoC

Understanding that education and training can be a big competitive advantage in a tough job market, many laid-off workers and young adults have taken steps to skill up. Widely accessible institutions that equip students with a specific skill or trade—such as online universities, community colleges, and vocational schools—have played an increasingly important role in providing the stepping-stones to do so.  

Despite the opportunities that these schools are putting within reach of aspiring individuals, the administration is considering a misguided federal rule that singles out for-profit institutions and could threaten students’ access to education. The so-called gainful employment rule—almost exclusively targeting for-profit institutions—would rate them based on debt-to-income ratios and loan repayment rates for former students. Under the proposal, if the schools don’t meet a federally imposed standard (which many nonprofit colleges could not meet if the rule applied to them), they would see their federal student aid slashed.

Students would be hurt the most. Enrollment numbers in private sector educational institutions reflect a growing demand from students who come from low-income backgrounds and underserved communities. By throwing down additional financial obstacles, the federal government could prevent them from pursuing a life-changing opportunity.

The Department of Education admits that without the aid tens of thousands of students could be forced out of programs without immediately enrolling somewhere else.Independent studies project that one in five schools wouldn’t meet the standard, and thatas many as a third of all students at for-profit institutions would be displaced.

What happens to their job prospects and earning potential then? And where will employers find workers for jobs requiring specific skills? For a nation facing the twin challenges of a skills gap and an income gap, the rule is a pretty dumb idea!

What makes the proposal even more foolish is that it won’t actually accomplish what it sets out to do. Proponents of the rule argue that it would help rein in education costs. They may be right on the goal, but they’re wrong on the approach. If regulators truly believed that the gainful employment rule would make postsecondary education more affordable, they’d apply it to all institutions.

Rather than an arbitrary rule applied only to private sector colleges that would deny federal aid to lower income students, a better approach would be toencourage greater transparency across the system. That would naturally drive institutions to offer a better value—and it would equip consumers with the necessary facts to make an informed decision based on what they need, not on what the government says they should have.

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Yesterday, Corinthian Colleges, one of the worst-behaving for-profit college companies, capped its dramatic collapse by filing for bankruptcy. A business that was getting as much as $1.4 billion a year in federal aid now has claimed in court that it has just $19 million in assets, but $143 million in liabilities.So who is owed all this money, and what does that tell us about Corinthian’s conduct?

The Intercept‘s Lee Fang yesterday noted some of the most interesting Corinthian creditors, listed in the company’s court filing. Some of those whom Corinthian promised money were public cheerleaders for the school and the controversial for-profit college industry, underscoring that the company spent a good chunk of its revenue on buying political influence.

The bankruptcy filing doesn’t list amounts owed by all creditors, but creditors include: Karl Rove’s non-profit Crossroads GPS, which supports GOP candidates; DC public relations firms TheGroup DC LLC, founded by former Obama advisor Art Collins, and APCO Worldwide; the American Enterprise Institute, whose scholars have attacked Obama administration regulation of the industry; the U.S. Chamber of Commerce, which has lobbied against those same regulations; the American Legislative Exchange Council, which Corinthian joined and which has drafted bills favoring the industry; former Corinthian board member Leon Panetta, previously President Obama’s secretary of defense, as well as Panetta’s non-profit research institute; and current board members Marc Morial, president of the Urban League, and Sharon Robinson, president of the American Association of Colleges for Teacher Education.

The bankruptcy filing does list the amounts owed to the 30 largest unsecured creditors, and those include one of law firms charged with defending Corinthian in court, the fabulously-named California firm Payne & Fears ($344,529); the national law firm Cooley ($367,184); various other legal technology, recruiting, and travel business; and Paul Dimeo, Corinthian’s Vice President, Real Estate & Facilities Operations, whom the company owes $184,903 in long-term compensation. (Corinthian CEO Jack Massimino is also a creditor, for an unspecified amount; in a recent year he was paid $3 million, and managed to buy a magnificent vacation house that was recently on the market for $11.5 million.)

The longer list of some 50,000 Corinthian creditors,without amounts listed, raises a number of intriguing questions. Republic Report has not yet reviewed the whole list, but we post it here for your review. Following are some highlights we’ve found so far, all of which would need further investigation:

1. Neutron Interactive. Last fall, Republic Report exposedSalt Lake City-based Neutron’s bait-and-switch scam — posting fake job listings and then trying to sell the desperate job-seekers overpriced for-profit college programs. Former employees involved in implementing this cruel hoax told me that one customer company was Corinthian. The creditor list provides further evidence that Corinthian and Neutron were in business together. UPDATE 10:40 am: Neutron’s partner call center, [EduTrek, whose employees first blew the whistle on this scam, is also on the creditor list (as “Edu Trek”).]

2. Dickstein Shapiro, the powerhouse Washington DC law firm, one of whose specialties, as described in the New York Times, is currying favor with state attorneys general on behalf of corporate clients, including, as the firm acknowledges in its own promotional brochure, Corinthian Colleges. 37 state attorneys general are now investigating abuses at for-profit colleges.

3. APSCU, the for-profit colleges’ Washington DC lobbying group, which has pressed policymakers to abandon common sense rules that would hold accountable predatory actors like Corinthian. Corinthian is no longer an APSCU member, just an APSCU debtor.

4. Something called the “Higher Ed Allied Leaders Coalition,” located at the same DC address as Akerman LLP, one of the two DC law firms recently registered as lobbyists for Corinthian.

5. The American Council on Education. The Corinthian creditors list includes three different departments of ACE, the leading lobby group for U.S. colleges and universities, including the “membership department.” What was Corinthian’s relationship with ACE? [UPDATE May 8: Corinthian was indeed a member of ACE; it joined in 2007.]

6. The Harvard Law Review. Did Corinthian order copies of the legal style manual The Bluebook from the Harvard journal and not pay up?  Did it make donation pledges and then fail to fulfill them?

7. A litigation attorney at the U.S. Consumer Financial Protection Bureau, which has sued Corinthian for misleading students. It’s hard to fathom why Corinthian owed money to this government lawyer. Maybe one of its vehicles damaged his car when he came to investigate? [UPDATE 10:40 am: A government official says this likely is just an inartful reference to the fact that the CFPB is suing Corinthian for damages; the U.S. Justice Department, which is also investigating Corinthian, is also listed.]

While many on this creditor list may be disappointed that they likely won’t be paid what Corinthian owes them, the greater tragedy concerns the tens of thousands of students who attended Corinthian’s Everest, Heald, and WyoTech schools and have been left deep in debt and often without the jobs they sought. Corinthian is now under investigation by more than 20 state attorneys general and at least four federal agencies. It has been accused of coercive and deceptive practices, including misleading students and oversight bodies about job placement performance in order to justify career training programs with sky-high prices. But whether Corinthian students who were deceived will have their debts forgiven remains very much unresolved.

This article also appears on Republic Report.

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http://apscu.org/about/board-of-directors/Mark-Pelesh.cfm

Mark Pelesh

Corinthian Colleges, Inc.

Santa Ana, CA

PeleshMr. Pelesh has served as Corinthian's Executive Vice President for Legislative and Regulatory Affairs since September 2003. Prior to joining Corinthian, Mr. Pelesh was a partner in the Washington DC law firm of Drinker Biddle & Reath LLP from 1997 to September 2003, where he founded and led the firm's Education Law Group. His work with Drinker Biddle & Reath LLP encompassed dealing with Congress, the U.S. Department of Education and many state authorities, as well as representation of accrediting agencies. He also served as a participant in the Department of Education's negotiated rulemaking procedures.

From 1981 to 1997 Mr. Pelesh was with the law firm of Cohn and Marks, where he served as partner from 1985 to 1997 and associate from 1981 to 1985. At Cohn and Marks, Mr. Pelesh helped establish the firm's education practice and served on its management committee. He began his career at the law firm of Arnold & Porter, where as an associate from 1978 to 1981 his work focused on corporate, antitrust, real estate and litigation matters.

Mr. Pelesh holds a J.D. degree from Yale Law School, where he was an editor of the Yale Law Journal, and a Bachelor's degree with Honors in History from Stanford University, where he was elected Phi Beta Kappa. His articles on the legal issues surrounding education have been published in law reviews at Duke and Notre Dame and for the National Association of College and University Attorneys, among other publications.

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university herald?

Education Department to Relieve Loan Debt of Students Affected by Corinthian Closures

The U.S. Education Department (ED) announced a plan to relieve the student loan debt of students affected by the for-profit Corinthian Colleges system.

According to *the Los Angeles Times*, the sweeping debt relief is expected to apply to tens of thousands of students who were left with useless credits when a number of Corinthian schools abruptly closed in April. The relief will also extend to students whose schools announced their closure and were offered assistance.

In the latter's case, the student will have to have withdrawn after June 20, 2014 to qualify for debt relief.

"You'd have to be made of stone not to feel for these students," ED secretary Arne Duncan told reporters in a teleconference. "This has to be a wake-up call to Congress... Congress has to be part of the solution, not part of the problem, and candidly, members on both sides of the aisle have been part of the problem."

Corinthian Colleges initially came under federal investigation for allegations they falsified job placement statistics to attract prospective students.The system announced a full-scale closure of its campuses after the ED determined the allegations were true.

"I am committed to ensuring that every student has access to an education that will put them on solid footing for a career, and I will hold schools accountable for practices that undercut their students and taxpayers," Duncan said in a press release. "Where students have been harmed by fraudulent practices, I am fully committed to making sure students receive every penny of relief they are entitled to under law. We will make this process as easy as possible for them, including by considering claims in groups wherever possible, and hold institutions accountable."

It is not clear how much the ED will pay out, but the Times noted Corinthian enrolled 350,000 students since 2010 who then racked up about $3.5 billion in student loans.

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Corinthian Colleges is a for-profit college chain that operates campuses under names like Everest, Heald, and WyoTech, in addition to offering degrees online. It has become notorious for aggressive recruiting practices and leaving students unprepared for the job market and saddled with massive student loan debts. In Milwaukee, for example, where a Corinthian Everest campus was financed with $11 million in city bonds,just 25% of students found jobs and over half dropped out; the campus closed two years after it opened. Nationally, over 40 percent of Corinthian's students default on their loans, and only 60% of students complete their coursework. In June, Corinthian disclosed that it is under investigation by the Securities and Exchange Commission (SEC) and has been subpoenaed by California's Attorney General for its recruiting practices and financial responsibility. cmd

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7/14

WASHINGTON-- Iraq and Afghanistan veterans have flocked to for-profit colleges, including a troubled chain that is closing or selling its campuses amid a series of federal and state investigations.

A report to be released Wednesday from the office of Sen. Tom Harkin, D-Iowa, a critic of the for-profit education industry who chairs the Senate Education Committee, finds that for-profit colleges received $1.7 billion in Post-9/11 GI Bill benefits in the 2012-2013 school term. About a quarter of benefits paid under the program went to the for-profit sector.

Among the top 10 recipient schools in terms of GI Bill funds, eight were from the for-profit sector. One of them was Corinthian Colleges, a chain based in Santa Ana, California, that recently reached an agreement with the Education Department to sell or close its more than 90 U.S. campuses. The Education Department has said it has concerns about the chain's operations that included allegations of falsifying job placement data used in marketing claims to prospective students, and allegations of altered grades and attendance.

Since the new GI Bill rolled out in 2009, Corinthian has received $186 million in the new GI Bill funds, the report said. Last week, the advocacy group Student Veterans of America placed the schools under the Corinthian umbrella - Everest College, Heald College and WyoTech schools - on its "not recommended" list.

Including Corinthian, the report finds that seven of the eight companies face investigations by states attorneys general or federal agencies for "deceptive and misleading recruiting" or other possible federal violations. Even as overall enrollment decreased at the eight schools since 2009, it says the number of veterans enrolled at these schools increased.

For-profit colleges have been popular among veterans, in part, because of offerings in skilled trades and flexibility such as online classes.The new GI Bill program provides the most generous school benefits paid to warfighters since the original bill was enacted in 1944. It can be used by a veteran or a member of the immediate family - and more than a million people have used it so far.

Michael Dakduk, the vice president for military and veterans affairs with the Association of Private Sector Colleges, said in a statement: "It is no surprise that members of the military choose our institutions because we provide them with career-focused programs, important support services and flexibility they need to complete their education."

But, the for-profit sector has among the highest student loan default rates and lowest graduation rates in higher education and has been a target of Democrats. The Obama administration has pushed "gainful employment" regulations that would penalize career-oriented programs that produce graduates without the training needed to find a job with a salary that will allow them to pay off their debt.

Harkin's report finds that the average cost for a veteran to attend a for-profit college is $7,972, compared to $3,914 for a public college - about twice the price.

The two top recipients of GI Bill money not in the for-profit sector were the public University of Maryland system and the non-profit Embry-Riddle Aeronautical University, according to the report.

Earlier this year, the Student Veterans of America issued a report that said a little more than half of the veterans who got college money under the GI Bill since 2009 eventually graduated. The rate was lower than the graduation rate for traditional students, who generally enroll out of high school, but higher than for veterans' non-traditional peers - those students who also tend to be older and have families and jobs.

It found that about three-quarters of the student veterans who graduated did so from public institutions. Another 15.5 percent attended private universities, while about 13 percent attended for-profit schools.

Another group, the Iraq and Afghanistan Veterans of America, has lobbied against what is known as the "90/10" rule that requires colleges to receive at least 10 percent of their revenue from sources other than the federal government. Students using the new GI Bill don't count toward the limit, so the veterans said they are aggressively targeted by the for-profit industry.

Last month, the nation marked the 70th anniversary of the Servicemen's Readjustment Act of 1944, more commonly known as the GI Bill.

The bill has been credited with providing millions of military veterans with college educations and creating the American middle class.

http://files.consumerfinance.gov/f/201409_cfpb_complaint_corinthian.pdf

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