Posted on

Government to Cancel $6 Billion in Student Loans for Defrauded Borrowers


Around 200,000 former students who attended schools that they said defrauded them will have $6 billion in federal loans canceled under a sweeping settlement announced on Wednesday, the latest move by the Biden administration to address the student loan crisis by eliminating some debts.Those who applied for relief — some as long as seven years ago — will have their loans wiped out if they attended one of more than 150 schools named in the class-action settlement, nearly all of which are for-profit colleges and vocational programs. The deal reverses 128,000 denial notices — which a federal judge called “disturbingly Kafkaesque” — that were sent to relief applicants during the Trump administration.Many of the schools included in the settlement are out of business. They include large chains like the Art Institutes and other campuses run by the Dream Center, whose operations abruptly collapsed in 2019, and those owned by Career Education Corporation. The latter, at its peak, enrolled tens of thousands of students at more than 100 locations. The deal also includes a few colleg …

Read More