Corinthian boosted figures to obtain federal funds

After wrapping up a nine-month electrician training program at Everest College-San Bernardino in 2011, Kenneth Dewar hoped to get the career placement assistance he had been promised.

Then he spotted his own photo on a campus wall featuring "successfully placed" graduates. The school had counted his sporadic gigs as a freelance audio engineer, work he secured before ever enrolling.

"I was a mark in their book, and they didn't want to change it," said Dewar, 39, whose attempts to get placement assistance went nowhere.

As federal regulators move to shut down Everest's parent company, Corinthian Colleges Inc., corporate documents and interviews with company insiders provide a behind-the-scenes portrait of how Corinthian persuaded hundreds of thousands of low-income students to fork over as much as $40,000 for vocational degrees.

Interviews with staffers and students, along with government lawsuits and company regulatory filings, reveal a systematic effort to manipulate data used to recruit students and retain eligibility for federal student aid the lifeblood of company profits.

Federal and state investigators have long viewed Corinthian, based in Santa Ana, as one of the most problematic players in the troubled for-profit college industry, which has come under scrutiny for predatory marketing.

The student loan pipeline fueled the company's rapid enrollment growth, peaking at more than 110,000 students in 2010. Corinthian charges students up to 10 times the cost of a comparable community college education. That requires many of them to take on more debt than they can repay leaving taxpayers on the hook for mass defaults.

"It just made you feel dirty after a while," said Tyrone Gaines, who worked in corporate marketing and training at Corinthian's Santa Ana headquarters for three years ending last July. "They don't make money; they take money from the taxpayers. That's their whole business model."

Corinthian spokesman Kent Jenkins declined to make company executives available for interviews. In a statement, he said there is "clear evidence that students at Corinthian Colleges are well served by their education."

Jenkins cited a 61% overall graduation rate and a 69% job placement rate. Allegations of manipulating job placement rates are "without merit," the company said.

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Corinthian boosted figures to obtain federal funds