DeVos loses- U.S. Federal Court refuses to stick students with 150 million in loan debt
In a second U.S. Federal Court admonishment, Secretary of Education Betsy DeVos will begin loan forgiveness procedures for 15 thousand students who are currently paying loans to mostly for-profit colleges that have since been closed down- mostly for financial improprieties and granting of near-worthless diplomas. DeVos had sided with the for-profit colleges in keeping the loans in place, despite an earlier Obama Administration policy that should have eliminated them.
A federal judge ruled in September that DeVos’ attempts to undermine the established 2016 “borrower defense” regulations were illegal. And in October, the same judge rejected for-profit colleges legal attempts to stop the regulations, which cleared the way for the Obama-era policy to take effect.
Secretary DeVos is also being forced to implement a package of regulations that will create more protections for student loan borrowers who were impacted by a school closure or defrauded by their college.
These loan cancellations are a direct result of a California consumer advocacy group lawsuit targetting DeVos in November for failing to carry out the federal loan cancellation policy under the 2016 “borrower defense” rules.
Department of Education officials will begin emailing students Friday in order to retire the 150 million dollar debt; an outreach they believe will take about 90 days.