Corinthian Colleges Inc. Case Study

The Corinthian Colleges, Inc. (CCI) which directed the Everest, Wyotech and Heald colleges and were all considered Private Postsecondary schools deceived their students by making them believe hollow promises that had no intentions of being true. They fabricated false job placement rates for students. The Corinthian Colleges declared bankruptcy after the Consumer Financial Protection Bureau (CFPB) affirmed that students were being cheated and that the job prospects were only an advertisement to attract more enrollees and to have them apply and take out private loans. Therefore, "the Everest College, Wyotech and Heald College campuses, abruptly closed its California sites, leaving more than 10,000 students out in the cold" (Bernick, 2015). Also, according to the Federal Register, which is the Daily Journal of the United States Government, the CFPB function is to
These types of schools appealed to low-income individuals, most of whom would probably be the first to graduate in their family. They did not understand the loans they were taking out and may have been encouraged to take out the maximum amount allowed. In reducing the amount that Corinthian could receive in federal funding, the 90/10 rule was to be enforced. The 90/10 rule is the following, “a federal law mandating they receive no more than 90 percent of their funding from federal student aid programs” (Schuman, 2015). Therefore, Corinthian could receive 90% of Federal funds for student to pay for schooling, but the other 10% had to come from other sources such as VA benefits, State Grants, Scholarships, Agency payments, or cash payments. Other Private Postsecondary schools have to abide by this type of rule, but they may have different parameters such as 85/15 or 95/5 based on the