Approximately $28 million dollars in federal loans owed by over 1,000 students at Corinthian Colleges will be taken away. Reports say that the students had been swindled into taking out loans by the colleges false advertising of job placements.
This is the first time the federal law allowed student debtors to petition the Education Department to discharge debt coming from fraudulent schemes. An activist group called “Debt Collective,” released a statement saying
,”The department funneled billions of dollars to executives and shareholders of these fraudulent ‘schools’ for over a decade.It now wants to save face by creating a Rube Goldberg-type contraption to prevent as many people as possible from seeking the relief they deserve.”
According to California’s top prosecutor, the company aimed at “isolated, impatient people with low self-esteem and few people in their lives who care about them.” Washington Post says they sent false promises of employment. They targeted single mothers, veterans, and people with low income. Corinthian college also filed for bankruptcy in May.
Source: Complex
