Under federal investigation, Corinthian Colleges denies wrongdoing

The U.S. Department of Education set its sights on Corinthian in January, requesting extensive data and documentation to justify the company’s job placement rates. In June, the Education Department contended Corinthian had failed to provide the information as requested, and put a 21-day hold on the company’s access to federal student aid. The sanctions put Corinthian on the brink of collapse. Last year, the company received nearly 85% of revenue from federal loans and grants. In a June regulatory filing announcing the financial penalties, the company told investors it might have to shut down without additional funds. Amid declining enrollments and problems with an internal student lending program, Corinthian had already been struggling with cash flow this year.