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For three years, Cheyney University failed to meet its requirements to track federal student aid awarded to its students, The Pittsburgh Post-Gazette reported. Colleges and universities are required to do such tracking to make sure students are eligible, and Cheyney could have to repay funds for which it can't document student eligibility. Just under $50 million in aid awards was not tracked, and that process has now started. It is unclear how much the university could owe. Cheyney, a historically black college in Pennsylvania, is already facing significant financial problems.
U.S. Senator Marco Rubio, a candidate for the Republican presidential nomination, last year sought leniency for Corinthian Colleges after the Education Department imposed tight limits on the for-profit provider's access to federal aid, Bloomberg reported. In a letter to senior department officials obtained by Bloomberg, Rubio argued that the department should show leniency to Corinthian while it was cooperating with the department's investigation. “It has been brought to my attention that the U.S. Department of Education has recently placed extreme financial constraints on Corinthian Colleges, Inc. by restricting the company's timely access to federal financial aid. It is my understanding the Department of Education has requested extensive documents be provided by Corinthian Colleges for review, and Corinthian has acted in good faith to try to provide these documents as expeditiously as possible,” Rubio wrote.
The Bloomberg article also noted that Corinthian Colleges contributed $5,000 to Rubio's political action committee during the 2014 election cycle.
A spokesperson for Rubio defended the letter, telling Bloomberg, “Senator Rubio felt it was important to protect the thousands of students in Florida from being punished and having their educations disrupted while the investigation was underway. His priority has always been to improve access to higher education options and increase transparency in higher education.”
Parents who are saving money for their children to attend college said they are earmarking 10 percent of their total savings for that purpose, according to a new report from Sallie Mae, the student lender. But the average amount parents said they have set aside for college has declined by 25 percent since last year, to $10,040 from $13,408.
"Parents are allocating approximately 10 percent of their total savings for their children’s college, a rate that has remained stable over the past three years," said the report. "However, since savings overall are down, the dollar amounts being saved for college are also lower."
This is the fifth installment of Sallie Mae's college saving study, which it first released in 2008. The report found that 4 in 10 of the surveyed parents said they were confident they could pay for the future price of college.
CHICAGO -- Education Secretary Arne Duncan said Tuesday that he remains open to having his agency cancel the federal student loans of some borrowers who attended Corinthian Colleges.
“Everything’s on the table,” Duncan said during remarks at the Education Writers Association conference here.
Duncan said that the Education Department was working to figure out “a fair and impartial” way to handle the more than 250 claims filed by former Corinthian students formally asking to have their debt canceled.
They have pointed to a mostly dormant provision of federal law that allows borrowers to assert misconduct by a college as a reason why they shouldn’t be legally responsible for repaying their loans.
Over the past 15 years “we’ve had, like, four of these cases,” Duncan said Tuesday. “So we don’t have a lot of practice on this. The rules aren’t very clear.”
“There are certain things in the law that students would have to prove” in order to have their loans canceled, he added.
Duncan also framed the Corinthian debt forgiveness issue in the larger context of the administration’s crackdown on for-profit colleges. The department last week fined Corinthian-owned Heald College $30 million over allegations it misrepresented job placement rates.
“We’re trying to make up for some real wrongs at the back end,” Duncan said.
Separately, state regulators in California announced this week that they have ordered Corinthian’s campuses operating under the Everest and WyoTech brands to stop enrolling new students. The emergency action, which takes effect Thursday, means that only a handful of remaining Corinthian-owned campuses, such as its Rochester, N.Y., and Phoenix locations, are allowed to seek new students.
California's consumer protection agency on Tuesday ordered Corinthian Colleges' campuses in the state to stop enrolling students after tomorrow, the Orange County Registerreported. An official of the Bureau for Private Postsecondary Education said the order would "protect individuals who may have been thinking about enrolling at these schools." The California agency's move is the latest blow -- among many -- for the crumbling for-profit provider; last week, the U.S. Education Department fined the company $30 million.