Corinthian Colleges Forced To Pay $1.1 Billion For Misleading Students

A California judge has ruled Corinthian Colleges, a defunct for-profit college company, must pay more than $1.1 billion in damages for false and illegal advertising that misled students’ perception of the school, the Los Angeles Times reported.

Corinthian Colleges made false claims to students about job placement rates of graduates from their schools and used military seals in ads, which is illegal, San Francisco Superior Court Judge Curtis Karnow found Wednesday. The judge also found the colleges advertised degrees they didn’t in fact offer, such as degrees for X-ray technicians.

“For years, Corinthian profited off the backs of poor people — now they have to pay. This judgment sends a clear message: There is a cost to this kind of predatory conduct,” California Attorney General Kamala Harris said in a statement.

The judge found this not only misled students, but also investors in the college company. Students were barred from going to class if they didn’t make their loan payments, which was found to be an unfair debt collection practice.

Harris filed the lawsuit against Corinthian Colleges in 2013, saying that the company had profited from predatory advertising and securities fraud. The company was forced to file for bankruptcy in May, just a week after it closed its remaining 30 facilities, the Huffington Post reported.

At one point, the company operated more than 120 colleges in North America. The U.S. Department of Education slapped the company with a $30 million fine in April 2015, arguing one of its college systems, Heald College, paid temp agencies to employ their students for brief periods of time to increase placement rates.

“For too many students, Corinthian turned the American dream of higher [education] into a nightmare of debt and despair,” former student financial services regulator for the Center for American Progress Rohit Chopra tweeted in April.