Corinthian Colleges, Inc. (Corinthian) was once the country's largest for-profit chain of colleges. Corinthian ran colleges under the names Everest College, WyoTech, and Heald College. From 2007 to 2011, Corinthian gained revenue of $1.75 billion. Despite its rise in success, in 2014, Corinthian was hit with several investigations by state and federal authorities into its business practices. The investigations concerned falsified job placement rates and student attendance records to obtain access to federal student loans and grants. As a result of these investigations, Corinthian recently announced that it has shut down over two dozen of its campuses. As a result of the closure, over 10,000 California students will be displaced.
In January 2014, the U.S. Department of Education requested extensive data and documentation from Corinthian to justify Corinthian's job placement rates. By June 2014, Corinthian had failed to provide the information requested, and the Department of Education suspended the Colleges' access to federal student aid. In 2013, Corinthian received nearly 85% of its revenue from federal loans and grants, so without federal student aid in 2014, Corinthian lacked the cash flow it needed to survive and faced severe financial hardship. In early July 2014, Corinthian agreed to sell most of its schools and closed a dozen of schools in a deal with U.S. education officials. But its problems continued.
Corinthian also faced an ongoing lawsuit filed by California Attorney General Kamala Harris. Harris' office alleged that Corinthian had engaged in a fraudulent behavior, including financial arrangements with temp agencies to count students as being "employed." Previously, Corinthian had faced a similar lawsuit in 2007, which it settled for $6.5 million and admitted no wrongdoing.
In April 2015, the U.S. Department of Education levied a $30 million fine against Corinthian's Heald College system, which primarily operates in California. The penalties were for the falsified job placement rates that were boosted by paying temporary employment agencies to hire students for short periods of time after graduation. Corinthian was ordered to stop enrolling new students.
As a result of the investigations and financial ruin, Corinthian filed for bankruptcy and closed 13 Everest and WyoTech campuses in California and 12 Heald College campuses in California, Hawaii, and Oregon. Corinthian plans to close more schools and its online division located in Tempe, Arizona. This causes great difficulties for former Corinthian students, who must either transfer their credits or get a discharge of federal student loans and start their educations over at a new college. Transferring credits to a college that will accept credits from Corinthian is easier said than done. It is a time consuming process and there is no guarantee the credits will be accepted. Everest and WyoTech have nontraditional accreditations that typically apply to career colleges, which means it can be difficult to transfer the credits to a community college or four-year college.