Department of Education forgiving $171 million in debt owed by students of a bankrupt for-profit college
The U.S. Department of Education will forgive $171 million of debt owed by more than 11,000 former students of the for-profit school Corinthian Colleges Inc., which declared bankruptcy in 2015.
The government is forgiving the loans under a federal law known as the "borrower defense," the Los Angeles Times reports, which relieves the debt of people able to prove they've been defrauded. The now-defunct Corinthian ran several colleges, including Heald, Everest, and WyoTech, which had high tuition rates and few admission requirements. In March, a judge in San Francisco County found that Corinthian made false or misleading statements about job placement rates for graduates, and the company was ordered to pay $820 million to students. When it claimed bankruptcy, Corinthian claimed to have $143 million in liabilities and only $19 million in assets.
The government is only looking at claims of students who took out loans in 2010 or later, and the average amount of debt relief per student is $15,280, the Times reports. Since 2010, nearly 350,000 Corinthian students have taken out about $3.5 billion in federal loans. Former student Tasha Rincon, 34, told the Times she owes more than $46,000 in loans for classes she took at an Everest campus in Ontario, California. She said she studied to become a probation officer, and was told by Corinthian that 93 percent of students in the program would get well-paying jobs. She could only find a minimum wage job as a security guard, and now works three hours a day serving lunch at a high school.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Create an account with the same email registered to your subscription to unlock access.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Catherine Garcia is night editor for TheWeek.com. Her writing and reporting has appeared in Entertainment Weekly and EW.com, The New York Times, The Book of Jezebel, and other publications. A Southern California native, Catherine is a graduate of the University of Redlands and the Columbia University Graduate School of Journalism.
-
Today's political cartoons - April 21, 2024
Cartoons Sunday's cartoons - devilish decrees, biblical blunders, and more
By The Week US Published
-
5 carefully selected cartoons about the Trump-Daniels jury selection process
Cartoons Artists take on a stress-free life, rare peers, and more
By The Week US Published
-
Loire Valley Lodges review: sleep, feast and revive in treetop luxury
The Week Recommends Forest hideaway offers chance to relax and reset in Michelin key-winning comfort
By Julia O'Driscoll, The Week UK Published
-
USC under fire for canceling valedictorian speech
Speed Read Citing safety concerns, the university canceled a pro-Palestinian student's speech
By Rafi Schwartz, The Week US Published
-
Florida teachers can 'say gay' under settlement
speed read The state reached a settlement with challengers of the 2022 "Don't Say Gay" education law
By Peter Weber, The Week US Published
-
Biden administration to forgive $39B in student loan debt for 800K borrowers
Speed Read
By Theara Coleman Published
-
Advocacy groups challenge Harvard's legacy admissions policy
Speed Read
By Catherine Garcia Published
-
2 Michigan school districts ban backpacks after confiscating 4th gun this year
Speed Read
By Theara Coleman Published
-
Education Department to limit bans on transgender student athletes but allow exceptions
Speed Read
By Peter Weber Published
-
UAE becomes 1st Middle Eastern country to mandate Holocaust education in schools
Speed Read
By Justin Klawans Published
-
College admissions scandal mastermind sentenced to 3.5 years in prison
Speed Read
By Devika Rao Published