More Debt Relief for Corinthian Students

Education Department says students who attended dozens of Corinthian-owned campuses across the country are now eligible for federal loan forgiveness.

March 28, 2016
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Education Secretary John B. King Jr.

The U.S. Department of Education on Friday announced that thousands more students who attended campuses owned by Corinthian Colleges would be eligible to have their federal loans forgiven.

The department said it had enough evidence of fraud at 91 former Corinthian campuses to grant debt relief claims for students who attended those institutions, so long as they fill out a form on the department’s website.

The additional Corinthian colleges covered by the announcement include campuses that operated under the Everest and WyoTech brands across more than 20 states.

The department previously announced that students at some California-based Everest and WyoTech campuses were eligible for loan forgiveness, but Friday’s announcement was the largest batch -- tens of thousands of additional students -- made eligible for debt relief.

Education Secretary John B. King Jr. announced the new batch of possible loan forgiveness at a press conference in Boston with Massachusetts Attorney General Maura Healey, who with other state attorneys general and some Senate Democrats had been pressing the Obama administration to more expansively grant debt relief to former Corinthian students.

Healey said the department’s decision was “completely unprecedented” in how many borrowers at one time would be made eligible to have their loans canceled.

While she praised the department’s announcement on Friday, she also called for “clear rules” that govern federal loan forgiveness going forward. Negotiations over such rules -- in which Healey’s office participated -- ended earlier this month in a stalemate, freeing the department to move ahead with its own plans.

“There is a tight timeline to get these rules finalized before the end of the Obama administration,” Healey said.

The department also said Friday that it had already approved $42.3 million in loan forgiveness for 2,048 former Corinthian students who filed claims under the “borrower defense to repayment” provision of federal law. Another 6,838 former students who enrolled in Corinthian programs around the time of its collapse last year have been granted $90 million worth of “closed school” loan discharges, according to the department.

In addition, a report by the department official overseeing the debt relief process, Joseph Smith, shows that the number of claims filed by students attending other colleges has also increased in recent months. More than 1,000 federal loan borrowers attending the Art Institutes, owned by Education Management Corporation, have asked the department to cancel their loans, as have 344 borrowers from ITT Tech.


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