ECMC Group Inc., known for its work in the student loan industry, is acquiring 56 campuses from Corinthian Colleges Inc. in a $24 million transaction announced last month that will create the largest nonprofit career-college system in the U.S.

But three members of Congress raised objections to the plan in a letter sent to the Department of Education last week. Reps. Steve Cohen (D-Tenn.), Raul Grijalva (D-Ariz.), and Mark Takano (D-Calif.) argue that ECMC Group is not a good choice to acquire Corinthian's Everest and WyoTech campuses because ECMC Group is one of the largest U.S. student loan guaranty agencies and also has benefited from collecting student loan payments using, at times, "dubious tactics."

ECMC Group is forming a non-profit arm, Zenith Education Group, to complete the purchase and to operate the campuses. The letter from the lawmakers explains that once the deal is complete, Zenith will not have to meet new standards involving for-profit institutions, including job placement goals and the ability of its students to repay student loans.

ECMC Group is the parent company of Premiere Credit of North America, a collection agency that pursues student loan debts on an Education Department contract. It also is the parent of Educational Credit Management Corp., a large student loan guaranty agency.

ECMC Group's plan is to buy campuses in 17 states along with online programs. The deal is expected to close in January, subject to regulatory approvals.

The Congressmen wrote that they are concerned that ECMC Group has no experience operating an academic institution.

ECMC Group said that the transition from for-profit to non-profit status would involve changing "the culture and education model at the acquired schools, including lowering tuition and introducing strict accountability standards for program completion and job placement rates."

ECMC Group came under fire earlier this year in a front-page article in The New York Times that called the company's collection work "ruthless" in actions against student debtors. The article actually was about Educational Credit Management Corp., ECMC Group's arm that guarantees approximately $30 billion in federal student loans and serves as a contractor for the federal government and other guarantee agencies to collect student loan debts.

Corinthian, based in Santa Ana, Calif., has been under investigation by several federal agencies. In June, the Education Department withheld the company's access to federal aid funds, causing liquidity problems. Corinthian then began liquidating assets by working to sell or close its 107 campuses.

In July, Corinthian agreed to warn prospective students online of its plans to sell most of its campuses. That move was in response to legal action by California Attorney General Kamala D. Harris.

The Consumer Financial Protection Bureau previously requested documents related to the sale and Corinthian reported in a regulatory filling in September that the CFPB accused the company of violating the Fair Debt Collection Practices Act and the Dodd-Frank Act.

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