The U.S. Department of Education announced Friday that it would be granting student loans to more than 1,800 borrowers attending a trio of for-profit colleges who made false recruitment claims and many students were unable to find jobs.
The Biden administration is paying off more than $ 55 million in debt for former students at Westwood College, Marinello Schools of Beauty, and the Court Reporting Institute. All three chains have been closed for years after being accused of fraud and deceit in their advertisements.
It is another step in the Department of Education’s efforts to clear a backlog of claims in the Borrower Defense Program that provides loans to students who have been defrauded by their schools. Applications piled as the Trump administration halted the program while it was rewriting the rules, leaving a recent backlog of more than 100,000 pending applications.
“The ministry will continue to do its part to quickly and fairly screen and approve borrowers’ defense claims so that borrowers can get the relief they need and deserve,” Education Minister Miguel Cardona said in a statement.
He added that the new round of approval “should serve as a warning to any institution showing similar behavior that this type of misrepresentation is unacceptable”.
Most of the newly approved claims relate to former students at Westwood College, which had campuses across the country before it closed in 2015. The chain advised students that their course could be transferred to other colleges, but often that wasn’t the case, the Department of Education said. Many students stuck to starting their college careers all over again after moving.
The company also made false claims about a criminal justice program in Illinois, saying graduates could get jobs as police officers in the Chicago area, the department said. But many law enforcement agencies refused to accept loans from Westwood, so many graduates had to take minimum wage jobs in other areas.
About 200 of the loan relief are for Marinello Schools of Beauty, which closed in 2016 after the federal government stopped funding. The college has failed to deliver the promised education in the past, the department said, and in some cases students left students without teachers for months. As a result, some beauty students never learned key skills like cutting hair, and many struggled to pass state license exams.
The department cleared 18 lawsuits filed by the Court Reporting Institute, which had offices in Washington, California and Idaho prior to its closure in 2006. The college was found to have lied about the amount of time it took to complete its court reporter training. Only about 6% of students actually graduated, the department found, and those who did took much longer than the college said.
Last month, the Biden government canceled the student debt of more than 18,000 borrowers from ITT Technical Institute, another defunct for-profit college. And in March it paid off $ 1 billion in debt for former ITT and Corinthian college chain students. In total, the government has granted loans totaling $ 1.5 billion to nearly 92,000 borrowers.
The Borrower Defense Program is one of several to be overhauled by the Biden administration to reverse Trump-era policies. Former Education Minister Betsy DeVos enacted new rules to reduce lending, which she felt had become too easy.
DeVos has also implemented a new formula that only offers partial credit relief even if claims are granted. Cardona overturned that formula in March, saying that any borrowers given relief would erase their loans entirely. The department held a hearing on the matter last month as it is considering changing the rules.
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source https://collegeeducationnewsllc.com/loan-relief-approved-for-more-for-profit-college-students/
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