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US to fire monitor overseeing formerly for-profit colleges

In this March 11, 2016 photo, Shane Satterfield, a roofer who owes more than $30,000 in debt for an associate’s degree in computer science from one of the country’s largest for-profit college companies that failed in 2014, holds his diploma in Atlanta. "I graduated in April at the top of my class, with honors," says Satterfield. "And I can’t get a job paying over $8.50 an hour." Despite pledging to distance itself from the poor business practices of the for-profit Corinthian Colleges Inc, the new owner of the Everest career college chain has retained key members of its staff and some of its hard-charging sales tactics. (AP Photo/David Goldman)
In this March 11, 2016 photo, Shane Satterfield, a roofer who owes more than $30,000 in debt for an associate’s degree in computer science from one of the country’s largest for-profit college companies that failed in 2014, holds his diploma in Atlanta. "I graduated in April at the top of my class, with honors," says Satterfield. "And I can’t get a job paying over $8.50 an hour." Despite pledging to distance itself from the poor business practices of the for-profit Corinthian Colleges Inc, the new owner of the Everest career college chain has retained key members of its staff and some of its hard-charging sales tactics. (AP Photo/David Goldman) In this March 11, 2016 photo, Shane Satterfield, a roofer who owes more than $30,000 in debt for an associate’s degree in computer science from one of the country’s largest for-profit college companies that failed in 2014, holds his diploma in Atlanta. "I graduated in April at the top of my class, with honors," says Satterfield. "And I can’t get a job paying over $8.50 an hour." Despite pledging to distance itself from the poor business practices of the for-profit Corinthian Colleges Inc, the new owner of the Everest career college chain has retained key members of its staff and some of its hard-charging sales tactics. (AP Photo/David Goldman)

By Associated Press 4 min read

WASHINGTON (AP) – The Education Department is removing a law firm hired to oversee the turnaround of schools owned by Corinthian Colleges Inc., a for-profit education company whose financial collapse had placed at risk more than $1 billion in federal student loans.

An Associated Press investigation identified conflicts with the ostensibly independent monitor.

The department said it was removing the firm, Hogan Marren Babbo & Rose Ltd. of Chicago, after the AP reviewed with senior agency officials its findings last week after a nine-month investigation examining the Obama administration’s response to Corinthian’s extraordinary collapse in 2014 amid allegations of mismanagement and fraud. The department had previously said only that it intended to review the firm’s performance going forward.

The chairman of the firm’s education practice, Charles P. Rose, declined Monday to discuss his firm’s removal.

The monitor has been overseeing the business practices of Zenith Education Group, an offshoot of a student-loan debt collection firm that took over Corinthian’s operations. It was serving as the U.S. government’s close-up eyes and ears, reviewing Zenith’s marketing materials and admissions phone calls and the accuracy of graduation and employment statistics.