Yesterday, the Consumer Financial Protection Bureau (CFPB) sued Corinthian Colleges, Inc., the for-profit college company. The consumer protection agency claims that Corinthian engaged in deceptive and predatory lending practices in an effort to recruit students, get them to take out private student loans, and then to collect on those loans.
Maura Dundon, senior policy analyst at CRL, issued the following statement:
Corinthian Colleges, one of the largest for-profit colleges companies in the United States, has long engaged in reprehensible practices that leave students with worthless debt. The CFPB has taken decisive action to collect restitution for the students affected by these abuses.
Students were manipulated into taking out expensive and expansive student loans by misleading information about job prospects and career assistance. Students overwhelmed by this debt were then subjected to aggressive and abusive debt collection techniques including pulling students out of class, denying access to academic resources, and withholding diplomas.
This action by the CFPB should further encourage the Department of Education to take strong steps to hold for-profit college companies to meaningful accountability standards in the forthcoming "gainful employment" rule. Students continue to be placed at risk by practices such as those documented in the Corinthian complaint. The time to act – on behalf of hopeful students across the country – is now.
For more information, contact Catherine An at 202.349.1878 or catherine.an@responsiblelending.org.