The Department of Education should be a responsible steward of the nation’s colleges and universities. These days it’s acting more like a debt collector for a predatory lender.
Today’s announcement of the sale of 56 Corinthian College campuses to Education Credit Management Corporation really drives this fact home. As former Everest student Geovanna Nieves noted, “This is another slap in the face from the DOE.”
We object to this sale for three main reasons.
1) It prevents current Corinthian students at the campuses that are sold from claiming the complete discharge of their debt under the Higher Education Act.
2) It ensures that Corinthian’s wealthy shareholders make a profit on a failing business.
3) It helps to revitalize these campuses by rebranding them under a new name.
Corinthian will get a fresh start, but students are stuck with debts they were deceived into. The DOE facilitated the robbery of over half a million current and former Corinthian students, yet the Department is effectively arguing that too many people were ripped off for it to pursue justice.
As Everest student Heather Wright said of the sale, “This is ridiculous. We were all charged a ridiculous amount to attend this so-called college and the DOE just wants to continue to support them?”
The Department’s claim that it is looking out for the best interests of students and the public is a smokescreen that masks the agency’s real agenda. If Corinthian closed its doors, current students would be entitled to a complete erasure of their debts. By approving this sale, the DOE illustrates the lengths to which it will go to keep students from getting their money back.
The sale of dozens of campuses to ECMC is a further sign that the Education Department is primarily interested in protecting investors and its own reputation. According to the New York Times, ECMC has been “the main private entity hired by the Department of Education to fight student debtors who file for bankruptcy on federal loans.” The company has recently has been accused of “ruthless tactics,” including demanding payments from people with terminal cancer and from those who had already paid off their debts.
Makenzie Vasquez, who attended Everest’s San Jose campus, called the the ECMC sale “outrageous. How can the DOE allow one horrible company to sell to another and act as if that fixes anything?” she asked. “I’m tired of these huge corporations that aren’t even people having more rights than we do.”
The Department’s ultimate loyalty to predatory lenders and to ensuring investor profits at all costs – even at the expense of defrauded students – is clear. We note that the California Attorney General’s office and other states are still pursuing their cases against Corinthian. We join with current and former Corinthian students – and with all student debtors – to fight this decision and to demand the discharge of these illegitimate debts.