For-profit Corinthians Colleges Inc. will sell off 85 of its campuses and close 12 others in a new deal with the U.S. Department of Education following an investigation of allegations that the company was altering grades and attendance records and falsifying job placement data that was used in marketing material aimed at potential students. Per the deal, most students will be fully reimbursed.

Corinthians operates about 100-odd campuses in 26 states (and Ontario, Canada)—largely in California, Florida, and Texas— and includes Everest College, Heald College, and WyoTech schools. More than 70,000 students are enrolled in the company's colleges.

The company had been dogged by investigations from federal and state agencies looking into its use of the $1.4 billion in federal financial student aid it was receiving annually. Last month, the Department of Education put a freeze on its federal aid money. Their new deal with the department includes funds to help transition and reimburse students. From the San Jose Mercury-News:

Corinthian's luck ran out in June when the education department put a 21-day freeze on its federal student aid money, saying "the company failed to address concerns about its practices.''

Days later, the department agreed to release $16 million in exchange for a deal ensuring a shutdown that would minimize students' disruption. The original deadline was Tuesday night.

The education department agreed to release another $35 million in federal student aid to the company to be used exclusively to help students complete their programs if they choose to do so after being fully informed of their options.

"This agreement allows our students to continue their education and helps minimize the personal and financial issues that affect our 12,000 employees and their families," Jack Massimino, Corinthians' chairman and chief officer, said in a statement. "It also provides a blueprint for allowing most of our campuses to continue serving their students and communities under new ownership."

Corinthians' closing is another strike against for-profit colleges, long criticized for being overpriced and leading to poor job prospects. Should the students enrolled at a Corinthians school choose to attend to another college, their credits from a for-profit school likely won't transfer.

[Image via AP]