Mallory Heiney, a 21-year-old former student of the now-defunct Everest College, recently wrote a scathing op-ed in the Washington Post, criticising the college and refusing to pay back her student loans.
She is a member of the Corinthian 15, a group of students who are refusing to repay their student loans after attending schools run by the Corinthian Colleges, including Everest, which has closed along with a number of Corinthian schools.
They cite The Higher Education Act of 1965 as their legal defence for not repaying their loans, as the law states that students whose schools have closed are allowed to withdraw and have their loans discharged.
The group also claims that the school was financially predatory, sticking them with massive loans they couldn’t pay off, as well as academically insufficient, where classes were little more than teachers reading aloud from textbooks.
The Consumer Financial Protection Bureau (CFPB) and US Department of Education (USDOE) sued Corinthian in September 2014 for numerous allegations of misconduct against students. The suit alleges that Corinthian intentionally targeted students predisposed to feeling optionless, and those with low self-esteem.
The lawsuit cites the existence of internal Corinthian communications where the school described prospective students as people with “low self-esteem and few people in their lives who care about them”; who are “isolated,” “stuck, unable to see and plan well for future”; and “impatient, and want quick solutions,” according to the complaint The Bureau filed.
The lawsuit also accuses Corinthian of intentionally targeting students lacking financial savvy and those with bad credit history. Corinthian looked for applicants with “minimal to nonexistent understanding of basic financial concepts, as well as poor or no credit history,” the complaint states.
Corinthian targeted these students aggressively, using “persistent telemarketing and subjecting consumers who visited its campuses to high-pressure sales efforts,” the complaint alleges.
Many of these advertisements were run during daytime television shows such as Jerry Springer and Maury Povich, to target the people Corinthian believed would be more susceptible to their recruiting methods, according to a separate legal action filed by California’s attorney general.
In fact, there are a number of Everest College commercial parodies on Youtube, where users mimic the aggressive marketing techniques used by the college.
Corinthian Colleges responded to the complaint back in September, denouncing allegations of misconduct and stating that the CPFB “…
wrongly disparages the career services assistance that we offer our graduates and mischaracterizes both the purpose and practices of the “Genesis” lending program.”
The lawsuit was eventually settled, where ECMC group, owner of Corinthian schools, and the CFPB and USDOE came to an agreement. ECMC agreed to provide over $US480 million in debt relief to Corinthian victims, no longer offer private student loans, and remove negative information from student borrowers’ credit reports.
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