Giant College Chain Fined $30 Million
Los Angeles — U.S. Department of Education dealt a $30 million fine Tuesday to California-based Corinthian Colleges Inc., a for-profit college operator that has been on the brink of collapse following a federal crackdown last year.
The Education Department said Corinthian misrepresented job placement rates to students in its Heald College system, which operates campuses in California, Hawaii and Oregon. Placement rates often play a key role in recruiting efforts, a benchmark that indicates the value of a degree in the marketplace.
The department found 947 cases of misstated placement rates, including instances where Heald College paid companies to create temporary positions for graduates to count them as “placed.” Some of the positions lasted two days, according to the agency.
Corinthian, once one of the nation’s largest for-profit college operators, has been in the department’s sights since last year. In June, the Education Department said it was restricting federal student aid to Corinthian amid concerns the company had been falsifying job placement rates.
Faced with losing the vast majority of its funding, Corinthian agreed to sell off or wind down operations at its schools. The company sold off the majority of its schools to a nonprofit student loan servicer last November, but its California schools are still owned by the company.