After coming under federal and state scrutiny, the for-profit giant Corinthian Colleges says it will shut down its more than two dozen remaining campuses. Massachusetts and other states have accused the career college of recruiting students with inaccurate job placement rates.
The Education Department is reviewing more than 250 claims against Corinthian, and Secretary Arne Duncan says everything - including student loan forgiveness - is on the table.
VIDEO: A Conversation with Sec. Arne Duncan
"There are certain things in the law that students would have to prove," Duncan told reporters gathered in Chicago for the annual Education Writers Association conference. "We're trying to make up for some real wrongs on the backend."
Barmak Nassirian, a policy analyst with the American Association of State Colleges and Universities, says the Education Department, which oversees the student loan program, faces a fundamental conflict of interest.
"[The Education Department] performs the role of financier of education," Nassirian said. "It puts them in a very difficult position when people raise very valid claims that an institution has ripped them off."
Corinthian, once one of this country's largest for-profit college chains, agreed in July to put 85 of its U.S. campuses up for sale and to close a dozen more. Last week, the Education Department fined the for-profit institution $30 million for misrepresenting its job placement statistics.
Corinthian still has about 16,000 students enrolled in five states - California, Hawaii, Oregon, New York and Arizona. The for-profit company says it will work with other schools and community colleges to provide them with ‘continuing educational opportunities.'
"We believe that we have attempted to do everything within our power to provide a quality education and an opportunity for a better future for our students," CEO Jack Massimino said in a statement. "Unfortunately the current regulatory environment would not allow us to complete a transaction with several interested parties that would have allowed for a seamless transition for our students."
