"In Its Death Throes, For-Profit College Chain Spent Over $100,000 A Month On Lobbying"
From April to June, which turned out to be the last three months of its corporate lifespan, for-profit education chain Corinthian Colleges spent $320,000 lobbying Congress, according to Bloomberg.
Late last year, Corinthian was accused of falsifying statistics on how its graduates fared in the job market and of bribing local companies to aid in the deception. Investigations were launched in various states and by multiple government agencies, and the college chain failed to comply with records requests relating to its students’ performance. The Department of Education responded by restricting the company’s access to federal funds — it had been receiving over a billion dollars in taxpayer money per year up until this spring — and Corinthian decided to close or sell off all 107 of its campuses around the country.
But the company didn’t go quietly, lobbying disclosure records for the second quarter of the year show. Corinthian spent $320,000 dollars — about double what Harvard spent on lobbying in the same time window — influencing lawmakers and government officials in the three months prior to its demise. Much of that money went to a specific effort to tamper with government oversight of the for-profit college industry.
“It’s a classic case of a company that is not winning and perhaps cannot win its argument on the merits,” Center for Responsive Politics head Sheila Krumholz told Bloomberg. The argument, in this case, was that the for-profit college’s 72,000 student customers were receiving accurate information from Corinthians marketing materials.
Those materials included information about the job placement rate of graduates from the subsidiary Everest College brand of schools. Multiple Everest campuses in various states were reportedly paying local companies to hire graduates into make-work jobs for 30 days so that the company could inflate the statistics it used to lure more paying customers. After the nominal period of employment associated with the bribe was up, the companies fired the Everest graduates they didn’t have any actual use for, according to in-depth reports by the Huffington Post that cited interviews with multiple Everest employees and graduates.
At least a quarter of what Corinthians spent lobbying in its last three months as a fully-operational company was meant to make it harder to hold companies accountable for exactly the sort of performance metrics that Corinthians companies allegedly falsified. At least $90,0000 went to supporting a bill by Rep. Virginia Foxx (R-NC) that would gut the Department of Education’s ability to police for-profits’ performance. Foxx’s bill would block three proposed rules for these education corporations whose revenue streams come primarily from taxpayer-funded programs accountable, including one that would restrict funding access for a school if fewer than 35 percent of its graduates is able to actively pay down their loans. Many for-profit schools would likely struggle to meet such a threshold, and Foxx — who receives substantial campaign cash from the industry — has fought to spare the companies from such rules.