Finkelstein Thompson LLP announces that it is investigating potential shareholder claims against Corinthian Colleges, Inc. (Nasdaq:COCO) (“Corinthian” or the “Company”).
On August 2, 2010, the U.S. Government Accountability Office issued a report concluding that the recruitment practices of certain for-profit colleges, including Corinthian, encouraged applicants to falsify information on federal financial aid application forms so the schools could receive more federal aid dollars. Subsequently, on August 13, 2010, the U.S. Department of Education issued a report suggesting that Corinthian students had been slow to repay their loans – a factor that would affect the school’s ability to obtain funding. An article in
later noted that Corinthian’s loan repayment rate was just 22% for the Company’s Everest College, which made up 85% of the Company’s revenue. Once this news was released, Corinthian shares fell to $5.22 per share on August 16, 2010, a drop of more than 43% from the share price on August 2, 1010, before these revelations were made public.
According to a recently-filed securities fraud class action complaint, from August 30, 2007 to August 19, 2010, Corinthian made false and/or misleading statements and/or failed to disclose, among other things: (1) the Company had overstated its growth prospects by engaging in illicit and improper recruiting activities, which artificially inflated the Corinthian’s reported results and future growth prospects; and (2) the Company's financial results were overstated in that the Company's colleges inflated tuition costs and its student loan repayment rates were well below levels required for participation in federal loan programs.
If you are interested in discussing your rights as a Corinthian shareholder, or have information relating to this investigation, please contact Finkelstein Thompson's Washington, DC offices at (877) 337-1050 or by email at
Finkelstein Thompson LLP has spent over three decades delivering outstanding representation to institutional and individual clients in financial litigation, and has been appointed as lead or co-lead counsel in dozens of shareholder class actions. Indeed, the firm has served in leadership roles in cases that have recovered over $1 billion for investors and consumers.