For-Profit School Sued for Deceiving Students and Facilitating Unfair Loans
|Targeted News Service|
A for-profit school operating in the
The complaint links to PDF file, filed today in
"We allege that this for-profit school aggressively recruited and misled students by falsely promising high quality, successful training programs, and instead left them with exorbitant student loan debt and without proper training or a well-paying career," AG Coakley said. "Our office will continue to investigate the for-profit school industry as we continue to see students and taxpayers suffer the consequences of high default rates, inadequate training, and mounting debt."
The complaint alleges that Corinthian, which subsists largely on taxpayer-backed loans to students, focused intently on recruiting new students regardless of their qualifications or whether the students were likely to complete or benefit from Corinthian's programs. This includes using deceptive marketing and high pressure enrollment tactics, steering some students to additional private subprime loans, as well as providing poor instruction.
The complaint addresses diploma programs in dental assistant, medical administrative assistant, medical assistant, medical insurance billing and coding, and massage therapy, offered at Corinthian's
The complaint links to PDF file against Corinthian seeks restitution to affected students, civil penalties and fees, along with injunctive relief to prohibit future deceptive practices.
Corinthian allegedly told prospective students that a very high percentage of its
Corinthian also allegedly told prospective students that its programs had placement rates ranging from 70 to 99 percent, when actual placement rates in certain programs were between 20 and 30 percent. Additionally, Corinthian allegedly hid that it had failed its accreditor's standards for placement from 2008 to 2011, and allegedly counted temporary jobs lasting longer than one day as a placement, including students who assisted at a two-day health fair. One student even reported that in order to receive her diploma, she was forced to falsely fill out a form stating that she had obtained a job.
According to the complaint, Corinthian deceived students by falsely promising prospective students they were "guaranteed" jobs after graduating. Corinthian, on its Everest website, has long represented "we help our graduates find jobs after graduation." In fact, the complaint alleges that Everest provides little or no help to students looking for jobs. One student noted "my problem was with the job placement department. Every time I called I would leave a message never to have it returned."
Corinthian also allegedly misled students about the salaries they could expect after attending the school. One student in the medical assistant program was reportedly told the salaries of graduates start at
HIGH PRESSURE ENROLLMENT TACTICS:
Corinthian allegedly engaged in harassing and deceptive enrollment tactics, which included having recruiting agents make hundreds of calls per week to prospective students, often numerous times per day. Corinthian's recruiters allegedly made a litany of promises in order to get consumers through the door. As one student noted "[the recruiter] called me every day at any time during the day or night to tell me that car[eer] will change my life. Guess what? It didn't! I'm working at my city grocery store."
Corinthian's recruitment tactics also involved creating a false sense of urgency to pressure prospective students to enroll immediately. Corinthian sent mailings to prospective students stating that there was "LIMITED SPACE AVAILABLE" and that students should "call so we can reserve a pending spot for you." In reality, Corinthian's
Corinthian's recruiters allegedly enrolled students knowing that they would be unable to obtain employment in their fields of study due to criminal backgrounds, inability to speak or understand English, or lack of high school diplomas. One student even reported that Corinthian provided her with correct answers to ensure that she passed a test intended to measure her ability to benefit from the program. Corinthian also allegedly told prospective
According to the complaint, in some classes students received little instruction of any kind. As one student noted, "My instructor did not teach us. This was basically a hangout place for people." Another student stated, "A typical day consisted of discussing a lecture assignment: we would answer among ourselves... the instructor just sitting there in her chair doing nothing." Although Corinthian advertised its programs as providing "high quality private education" with "professional level standards for conduct and behavior," students reported that classes were reportedly subject to constant disruptions and teachers and administrators made no effort or failed to maintain control of the environment.
PRIVATE SUBPRIME LOANS AND HIGH COST OF PROGRAMS:
Although most of the debt that students incurred attending Corinthian's schools comprised federal loans, Corinthian also created, guaranteed, and steered students into a private subprime loan program with interest rates as high as 18 percent. According to the complaint, by
Corinthian's tuition prices are among the highest among for-profit schools, according to the complaint. Currently, while Corinthian's diploma programs typically cost between
Today's matter is being handled by Assistant Attorney General
Today's action is a result of AG Coakley's comprehensive and ongoing investigation into the for-profit education industry.
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