Corinthian Fails to Reach Accord With Education Department
By Chris Staiti Jul 2, 2014 8:57 AM ET 2 Comments Email Print
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COCO:US0.27-0.01 -5.32%
Corinthian Colleges Inc. (COCO) failed to reach an agreement with the U.S. Education Department by yesterday’s deadline that would include a plan to sell or close the for-profit company’s 107 campuses.
Corinthian, which serves 72,000 students, expects to complete the agreement within days, the company said today in a statement. It owns the Everest, WyoTech and Heald schools. The Education Department released a similar statement.
Corinthian “continues to work cooperatively with the U.S. Department of Education,” the Santa Ana, California-based company said.
A shutdown of Corinthian would be the biggest-ever collapse in U.S. higher education. Corinthian is under investigation by 20 states, the U.S. Securities and Exchange Commission, the Consumer Financial Protection Bureau and the Justice Department for its recruitment and lending practices.
States have been rushing to make arrangements for Corinthian students who may soon be displaced. The California attorney general put up a website to give students information about possible places to finish their education. Education regulators in states including California and Illinois are reaching out to community colleges to find places for Corinthian’s students.
“We are optimistic that further conversations with the company will produce an acceptable plan in the next few days that protects the interests of students and taxpayers,” Education Undersecretary Ted Mitchell said in the statement.
To contact the reporter on this story: Chris Staiti in Boston at cstaiti@bloomberg.net
To contact the editors responsible for this story: Lisa Wolfson at lwolfson@bloomberg.net John Lear