Corinthian College Reaches Agreement with Ed Dept. on Phase-Out Plan

Corinthian Colleges, Inc. announced on Monday that it had reached an agreement with the U.S. Department of Education that is designed to keep the for-profit chain afloat long enough to sell off and shutter its campuses in an orderly fashion, The Chronicle of Higher Education reported.

The company – which owns Everest College, Everest Institute, WyoTech, and Heald College, serving nearly 72,000 students on 107 campuses – said last month that it was exploring "strategic alternatives," and it disclosed last week that the department had imposed financial restrictions that threatened its future. The department said the restrictions stemmed from Corinthian's delays in responding to its requests for data in an investigation into allegations that the company falsified graduates' job placement data and altered grades and student attendance records.

Corinthian said in a corporate filing on Monday with the U.S. Securities and Exchange Commission that the stop-gap measure would allow it to gain access to $16 million in student aid money immediately to allow current students to finish school.

Under the agreement, the company must hire an independent monitor that would have access to the company's financial and operating records and would oversee the company's progress on the transition plan. Corinthian also agreed to provide the data that the department had requested. The company and the department are expected to make the terms of the transition plan final by July 1.

"Throughout several days of intensive discussions with the Department, our goal has been to protect the interests of our students, 12,000 employees, taxpayers and other stakeholders," Jack Massimino, Corinthian's chairman and CEO, said in a statement. "This agreement helps achieve that goal. We worked collaboratively with the Department to reach consensus, and we will continue to do so as we finalize and implement the detailed transition plan."

 

Related Links

Corinthian Colleges, Inc. News Release

http://investors.cci.edu/releasedetail.cfm?ReleaseID=855922

The Chronicle of Higher Education

http://chronicle.com/blogs/ticker/corinthian-colleges-reaching-deal-with-u-s-will-sell-most-campuses/80367

Inside Higher Ed

http://www.insidehighered.com/news/2014/06/26/corinthians-failure-and-us-role-it-fuels-profit-critics#sthash.VAihrTM4.3fgcbNnB.dpbs