US will forgive $5.8 billion in student loans Corinthian Colleges: NPR
Christine Armario / AP
The U.S. Department of Education will forgive $5.8 billion in loans to students who attended Corinthian colleges, a chain of for-profit schools that misled students about job application rates and transferability student credit exchange.
This is the agency’s largest total of student loans.
The move, taken Wednesday, will impact 560,000 borrowers, the Education Department said.
Vice President Kamala Harris sued the company in 2013, when she was California’s attorney general, alleging it repeatedly used false advertising in its recruiting practices. Some other investigations by regulatory agencies and the federal Department of Education followed.
Education Minister Miguel Cardona said: “For too long, Corinthian has engaged in financial exploitation of students, leaving them increasingly in debt to pay for promises they will never keep.”
Affected students do not have to take any further action to secure their funds, and the agency will begin notifying those students soon.
Corinthian Colleges, Inc. was founded in 1995 and has since acquired several for-profit schools around the country.
In 2010, more than 110,000 students attended over 105 of its campuses, including Everest College.
In 2014 and 2015, Corinthian has sold or closed all of its facilities.
In 2016, Harris and the state of California won a $1.1 billion settlement in their case, which included $820 million in student restitution and $35 million in civil penalties.