After being subjected to many government investigations, Corinthian Colleges Inc., one of the biggest for-profit college chains in the U.S., is going to close more than 24 of the schools that haven’t yet been shut down. The decision was taken on Sunday, the 26th of April.
This means 10,000 students in California will be displaced and some will have to transfer to other schools. Another option for them would be to ask for student debt forgiveness. These loans were the ones that both brought huge profits and led to the termination of any activity in the company. Because it was so easy for students to access federal loan, the tuition went higher by the year. This ceased, once the government stopped providing such generous loans because of allegations regarding job placement rates falsification. Due to these, many students were attracted by the prospect of well-paying jobs and did not hesitate to apply to Corinthian colleges. The company even received a fine of $30 million for advertising such jobs and were accused of having paid agencies to temporarily employ students soon after graduating. This situation occurred within the Corinthian Heald System, operating mainly in California. Representatives of Corinthian denied such accusations.
Now students are left with no perspectives, with huge debts, some with degrees that might be worth next to nothing, and others with a big chance to never graduate. The worst part is that both students and employees were taken aback by this decision, as they had received no previous notice, even if the closure had been discussed for a few months.
Corinthian’s situation serves as a lesson for all the institutions which base their profit mainly on student loans. The government has its huge share of blame as well, for a variety of reasons. Firstly for failing to solve the deficiencies regarding the accreditation system. The vice president of the Institute for College Access and Success, Pauline Albernathy stated that the government is to assume responsibility for having allowed a school to rely so much on student loan. This situation prompts a reform of the system from its very core. The government is also held responsibility for not acting sooner, for allowing the schools to continue to enroll students, even given the legal problems Corinthian had. This resulted in a loss mainly for students, who are now indebted and have nowhere to go. Efforts should be made to enroll the students somewhere else or to forgive their student debts. Government officials stated that the education department will put more effort into improving transparency in the career prospects of college industry.
The schools are to close today (the 27th of April) but Conrinthian has not filed for bankruptcy, even if it will stop any activity. The staff will help its students with the paperwork to obtain transfers and credits.
Image Source: Buzzfeed
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