WASHINGTON, D. C. – Attorney General Karl A. Racine has joined 18 other attorneys general in demanding that the United States Department of Education (DOE) end extended delays in its program to cancel federal student loans for students victimized by predatory for-profit colleges.
Former Corinthian Colleges Inc. students are experiencing delays in review and approval of their loan cancellation applications. About 27,000 students nationwide who have already been approved for loan forgiveness have yet to see their loans discharged. Some students are nearing the end of 12-month forbearances on their loans, and face restarting monthly payments on debts that should be canceled.
In a June 5 letter to U.S. Secretary of Education Betsy DeVos, Attorney General Racine urged the Department of Education to review the mounting applications and work to timely finalize the discharge of loans where forgiveness has already been approved.
“Hard-working District students who made investments in a brighter future but were defrauded by Corinthian Colleges should not be on the hook for debts that are eligible for forgiveness,” said Attorney General Racine. “Secretary DeVos should move quickly to discharge these eligible loans and allow students to move on.”
The letter presses DeVos and DOE to provide information on what the department is doing to rectify the growing backlog of applications, and to provide a timeframe for discharge of the student debt. Moreover, since the Department of Education has already determined that these students are eligible for loan forgiveness, the letter urges DeVos to consider abandoning the application process altogether and automatically discharge all eligible loans.
After intense scrutiny by various government entities, for-profit Corinthian Colleges abruptly ceased operations in 2015. The Department of Education found that while it was operating, Corinthian made widespread misrepresentations between 2010 and 2014 about post-graduation employment rates for certain programs at its campuses.
Approximately 400 District residents who attended programs at Corinthian schools received a letter from the Office of the Attorney General in November of 2016 explaining that they are eligible for streamlined federal student loan cancellation based on DOE’s findings. The students were directed to fill out a short application for DOE.
District students were notified as part of a bipartisan effort by 47 attorneys general across the country to inform more than 100,000 former Corinthian students that they are eligible for streamlined loan cancellation.
“Relieving these hard-working Americans of their fraud-induced student debt will free them to participate more fully in their local economies, or even continue their educations with reputable schools,” the letter explains. A copy of the letter is attached.