U.S. Sen. Dick Durbin (D-IL) on Tuesday applauded the federal government's decision to increase expedited student loan relief for a broader portion of former Corinthian College students.
The Department of Education currently offers Corinthian students who attended schools that were closed directly because of the company's bankrupcy declaration to apply to discharge their federal student loans. However, until Tuesday's announcement, students who attended any of the school's branches that were sold to a private debt collector were not allowed the same leniency.
The school has been the subject of dozens of federal and state fraud investigations, many based on deceptive or predatory advertising that exaggerated or fictionalized claims about job placement and the value of a Corinthian degree. Most recently, a lawsuit by the Consumer Financial Protection Bureau led to a federal judge ordering Corinthian Colleges Inc. to repay $531 million to former students.
“The evidence is clear: for-profit Corinthian Colleges defrauded the federal government and its students," Durbin said. "In just one instance revealed today by the Department of Education, Corinthian claimed one of its automotive programs had a 100 percent job placement rate when in reality, the college placed zero students. Expedited relief to students of these schools – including some in Illinois who attended Everest University online – is welcome news.”
Durbin, former students from Corinthian's Illinois campuses, and Illinois Attorney General Lisa Madigan recently met with U.S. Department of Education Special Master Joseph Smith to discuss ways to address the disparity in debt forgiveness. Joseph is the Department of Education's appointed manager of the federal debt relief program for former Corinthian students.
The new expansion of debt forgiveness comes after the Department of Education and California Attorney General Kamala Harris concluded an investigation that found Corinthian's Everest and Wyotech locations in California and online Everest University programs misrepresented their placement rates to prospective and current students. Because Corinthian operated in Illinois under the same Everest logo, the investigation sets a precedent that could also justify former Everest students in Illinois applying for the same benefits.
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