Federal Judge Orders DeVos To Cancel Student Loans For 7,200 Defrauded Students

Yesterday, a federal judge ordered Education Secretary Betsy DeVos to cancel the coed loans for the 7,200 student borrowers in Massachusetts who attended the now-defunct Corinthian Colleges.

Massachusetts Attorney General Maura Healey applied for “borrower defense” on behalf of seven,200 former Corinithian College students as a gaggle application. Borrower defense is that the provision that helps defrauded students by giving the Secretary of Education the authority to discharge debt when schools lie and cheat their students.

DeVos refused to forgive the debt and Healey sued Secretary DeVos and therefore the Department of Education for his or her refusal to simply accept her application for debt forgiveness on behalf of the defrauded student borrowers in her state. The Project on Predatory Student Lending at Harvard graduate school also filed an identical suit.

Now the federal judge has said the Department must cancel the debt of those 7,200 students. “This ruling may be a clear and powerful statement of the rights of student borrowers, and a powerful rejection of the Department of Education’s ongoing and across-the-board refusal to acknowledge these rights and cancel fraudulent student loans, said Project on Predatory Student Lending Director Toby Merrill during a statement.

Attorney General Healey also celebrated the ruling. “Thousands of Massachusetts students cheated by Corinthian have finally had their day in court, and that they have won,” said Healey. “This landmark victory for college kids will cancel the federal loans for thousands of defrauded borrowers, mostly Black and Latinx students, targeted by a predatory for-profit school and abandoned by Secretary DeVos and also the Trump Administration.”

Senator Elizabeth Warren also applauded the choice during a tweet. The Massachusetts Senator has been very active in her time within the Senate usurping for-profit colleges and Secretary Betsy DeVos.

This ruling came almost simultaneously because the House of Representatives voted to override President Trump’s veto of a bill that may have overturned a replacement borrower defense rule that DeVos wrote. Her new rule would make it harder for defrauded students to urge relief. The bill passed both chambers originally, but there weren’t enough House Republicans to achieve the desired two-thirds threshold.

It’s likely this decision are going to be appealed, but this can be a win for defrauded students. Now, it’s likely 7,200 student borrowers will get their relief and have an opportunity at a chance.