Durbin Statement on Judge's Decision to Require Corinthian Colleges to Pay Restitution

[WASHINGTON, D.C.] – U.S. Senator Dick Durbin (D-IL) today released the following statement after learning that a federal district court judge has ordered the bankrupt Corinthian Colleges, Inc. to repay $531 million – including more than $400 million in student loans – to the now-shuttered school’s former students.


“Corinthian Colleges, Inc. – a for-profit college – defrauded students and taxpayers out of more than $500 million,” said Durbin, who was the first to ask for an investigation into Corinthian Colleges in 2013 following an article in the Huffington Post.  “Two questions: will anyone at Corinthian be held personally responsible?  And when will our government hold this industry accountable for the damage it is causing students across America?”


Yesterday’s decision came in a lawsuit brought by the Consumer Financial Protection Bureau (CFPB) against Corinthian Colleges, Inc. in the U.S. District Court for the Northern District of Illinois.  In the lawsuit, the CFPB alleged that Corinthian engaged in illegal deceptive practices including making misrepresentations about prospective students’ career opportunities, presenting falsified and overstated job placement rates, and misrepresenting the availability and utility of its career services.  After filing for bankruptcy earlier this year, Corinthian ceased defending itself in this lawsuit which prompted U.S. District Judge Gary Feinerman to take CFPB’s allegations as true and to enter a default judgment against Corinthian.


In December 2013, Durbin sent a letter to the Secretary of Education, Arne Duncan, asking him to investigate Corinthian Colleges, Inc. and their fraudulent marketing practices which included a subsidy program for employers to hire graduates temporarily and outright lying by the company through their advertisement of numbers substantially higher than actual job placement rates.  In February, following an investigation, the Department of Education took action against Corinthian Colleges, Inc. by denying the company’s pending new program applications and increased scrutiny in light of deceptive job placement practices.