A Corinthian Colleges investor filed a lawsuit on behalf of all persons who purchased or acquired COCO securities during the period from October 30, 2007 through including August 19, 2010, over alleged violations of Federal Securities Laws by Corinthian Colleges. Meanwhile an investigation on behalf of current long term investors of Corinthian Colleges, Inc. (NASDAQ:COCO), also including those who purchased prior to October 2007 and continue to hold those COCO shares, over possible breaches of fiduciary duties by certain officers and directors of Corinthian Colleges Inc. was announced.

According to the complaint filed in the United States District Court for the Central District of California the plaintiff alleges on behalf of all persons who purchased or acquired Corinthian Colleges, Inc. (NASDAQ:COCO) securities during the period from October 30, 2007 through including August 19, 2010, that Santa Ana, California based Corinthian Colleges, Inc violated the Securities Exchange Act of 1934 by issuing between October 30, 2007 through including August 19, 2010, false and/or misleading statements, as well as by failing to disclose material adverse facts about its business, operations, and prospects. The investigation on behalf of behalf of current long term investors in Corinthian Colleges, Inc. (NASDAQ:COCO) seeks to determine whether certain officers and directors of Corinthian Colleges breached their fiduciary duties in connection with the alleged securities laws violations.

On August 4, 2010, the Senate Health, Education, Labor, and Pensions Committee conducted a hearing on for-profit education firms, where Government Accountability Office representative, George Kutz, presented the findings of report GAO-10-948T, 'For-Profit Colleges: Undercover Testing Finds Colleges Encouraged Fraud in Deceptive and Questionable Marketing Practices.' The report detailed undercover investigations into 15 for-profit schools that uncovered misconduct by school staff. According to this GAO study, the college personnel at schools may have encouraged applicants to falsify their financial aid forms to qualify for federal aid and pressured applicants to sign a contract for enrollment prior to allowing them to speak to a financial advisor.