For Real? Yes (Surprise!)

http://www.edcentral.org/ecmc-bankruptcy/

"According to multiple sources, ECMC is asking Congress to make a special change to the rules that govern a college’s eligibility for federal student aid once it declares bankruptcy. Under current law, a bankrupt college is no longer considered to be an institution of higher education, a change that immediately triggers its loss of federal student aid. While we do not know exactly why ECMC is pursuing this exemption for Corinthian, it presumably would help the sale still go through if Corinthian cannot stay solvent until the deal closes. It also might stop creditors from going after Corinthian and further insulate ECMC from the troubled for-profit college chain.......

Seeing ECMC pursue such a special loophole is particularly rich because it has a contract with the Department of Education to handle some federal student loans when they are in bankruptcy proceedings. As detailed earlier this year by The New York Times, ECMC has been known to aggressively pursue borrowers to the point that it has been accused of wasting legal resources and abusing the bankruptcy process."

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Imagine that. A federal loan laundromat (CCi) gets up to its eyeballs in shit and convinces a federal loan collector to buy the sack of shit. Then the federal loan collector asks Congress to please, please allow the laundromat to continue to launder after they file for bankruptcy. So that the spin cycle keeps running on students who can't read and don't understand that the loan repayment schedule is the only thing that the "new" organization won't cheat on. This is federally funded paradise!

You really are morons! First of all federal students loans cannot be discharged in bankruptcy and the judge has no discretion. Secondly, ECMC is requesting an exception to the bankruptcy code that disenfranchises a college from being a place of higher learning after filing bankruptcy. In plan English they want to file bankruptcy and still be allowed to operate as a college. They might just grant their request as part of the back room deal that they made with the DOE to buy CCI and save the DOEs a**. Get it????

098: The bankruptcy judge has some discretion there, so it's more like a recommendation. I've had quite a few students who had fed student loans discharged in bankruptcy. One managed to get it done three times (I didn't ask her how). So ECMC tries to dissuade the judge from allowing it. Not illegal, but their methods are ethically questionable, especially considering the folks they go after. This is on top of the complaints about their especially aggressive collections approach and the insights into their collector's astronomical pay packages.

098, where is your irony and social issue detector? In most cases corporate legal peeps must search for it because it has become a vestigial organ. You know, like your appendix.

I am not a supporter of ECMC taking over CCi. However, I believe that according to current Bankruptcy laws anyone filing a Chapter 7 or 13 cannot bankrupt their federal student loans. Therefore, what is ECMC doing wrong legally? They may be morally wrong, but legally?

So ECMC's take on bankruptcy is "If you're a U.S. citizen and declare, screw you, no way you wiggle out of your obligations Mister!" but also "But your honor, we paid pennies on the dollar for these schools, we shouldn't also have to be inconvenienced by their failed legal obligations!" What next? Maybe a "special exemption" to force us to work for free so their debt collectors can keep pulling down a half mill a year? I'm out. I have a very bad feeling about ECMC. Those of you who stay, please keep collecting docs, and consider sending them to the press instead of the feds/AGs next time. This abuse of taxpayer dollars has been disgusting and looks like it's not stopping anytime soon.

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For Real? Yes (Surprise!)

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