WASHINGTON POST: How dozens of failing for-profit schools found an unlikely savior

Career College Central Summary:

It was once among the country’s most successful public companies, beloved by Wall Street for its simple, lucrative model: offering degrees to low-income students who borrowed heavily from the government to pay their tuition.
But the for-profit college giant Corinthian Colleges has spent much of the year in a tailspin. Investigations found the school used deceptive marketing to lure students into loans they had no hope of paying back, and the federal government suspended the schools’ access to federal aid.
Corinthian’s schools looked like they were toast. And then an unlikely savior swooped in.
The ECMC Group, which runs one of the biggest debt collectors used by the Education Department and has no experience teaching students, agreed last week to pay $24 million for more than half of Corinthian’s 107 campuses. The company plans to turn the for-profit campuses into nonprofit schools serving nearly 40,000 students.
The deal will create the country’s largest nonprofit system of career education and is the biggest sign yet that the beleaguered for-profit college industry, which currently has 2 million students enrolled, is trying to reinvent itself. Several other for-profit schools are also trying to turn into nonprofit institutions.
Critics say the Corinthian deal, which is unprecedented in scope, could put more taxpayer dollars and students at risk at a time when there is already $1 trillion in federal student debt.
“I find it ironic that a company whose history is in student debt collection is now going to run a set of colleges that excelled at sending students into default,” said Ben Miller, a senior policy analyst at the New America Foundation.

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WASHINGTON POST