Just when you think the accusations levied against now-defunct for-profit college chain Corinthian Colleges couldn’t get worse — inflating job placement rates, grade manipulation, and questionable marketing practices — they do. The California Attorney General’s office filed thousands of pages of documents and testimony as part of its ongoing lawsuit against the school highlighting an even more egregious practice: allegedly recruiting homeless students and assisting them in taking out thousands of dollars in loans they could never repay. 

ProPublica reports that the thousands of pages in testimony and other documents highlight the predatory practices used by Heald College, Everest University, and WyoTech.

In one instance a former student testified [PDF] that she and her fiancé were homeless and living in a tent in Northern California when they toured a Corinthian College campus.

Despite telling the school’s recruiter that they were homeless and unemployed, the recruiter promised them strong future job prospects, leading them to take out thousands in federal loans they could never pay back.

The woman tells of how she and her fiancé had to complete all of their studies and homework at the Heald Campus computer lab and how they relied on funds from the loans they borrowed from the student loan program.

“I also was able to get a work-study job on campus in the Academics office,” she said. “It was because of my work in this office that I learned that the credits I was earning at Heald were not automatically transferable to other colleges and that I had been deceived by the admission counselor.”

After three quarters at the school, the woman withdrew from classes, leaving her with $15,000 in debt.

“Shortly after I left Heald I received a bill from them stating I owed them $500,” she said. “With great difficulty, I paid that bill in amounts that ranged from $25 to $50 each month. I do not know how I will ever be able to repay this student loan. I now believe that I was taken advantage of and given false hope by Heald just so that I would enroll in their school.”

In another case, ProPublica reports that CCI pushed students to borrow from a bank the school had financial ties to.

According to the attorney general’s suit [PDF], Corinthian did not disclose to students its direct relationship with a lending program that the college had a backroom deal with.

Everest University’s Private Education Loan Preferred Lender List noted that “as a result of current conditions in the credit market, many lenders ceased making private education loans, or have tightened their credit criteria such that fewer borrowers are qualifying for such loans.”

The the school’s loan documents stated, “We do not promote or endorse this lender,” it still allegedly pressured students to seek funds through that lender.

At some campuses, ProPublica reports, school recruiters often promoted programs that didn’t exist.

For example, CCI repeatedly advertised for programs like “X-Ray Training School” and “Ultrasound Tech School.”

An email [PDF] between employees described ways in which the schools could take advantage of popular Google Keyword Trends.

“Please know that we have tons of data on keywords delivering leads to our campuses, which are often keywords for programs that we don’t offer,” the email states. “For example: x-ray technician programs, radiology schools, ultrasound technician schools, etc. These are definitely programs that are big in-demand – and we don’t offer them.”

A later email, which included a request to stop promotion of these programs, noted that the California AG had a “major problem with us bidding on terms that we do not offer.”

“We need to come up with a plan to immediately stop using certain keywords in our ad copy,” an email states.

ProPublica, which offers several more examples of CCI’s allegedly deceptive practices, reports that the college’s next court date is set for March 22.

At that point a the judge could issue a default judgment against the school and order it to pay civil penalties and compensation to the students.

How a For-Profit College Targeted the Homeless and Kids With Low Self-Esteem [ProPublica]

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