WASHINGTON — The Biden administration announced Wednesday was canceling approximately $5.8 billion in student loans held by students who attended Corinthian Colleges, The Associated Press reported.
Hundreds of thousands of students who attended the for-profit colleges will automatically have their loans canceled.
Under the cancellation action, anyone who attended the defunct chain between its founding in 1995 until it collapsed 20 years later will have their federal student debt forgiven, the AP reported. That will affect more than 560,000 borrowers.
“This has been a long time coming,” Nathan Hornes, who attended Everest College in Ontario, California, told The New York Times.
“As of today, every student deceived, defrauded and driven into debt by Corinthian Colleges can rest assured that the Biden-Harris Administration has their back and will discharge their federal student loans,” Department of Education Secretary Miguel Cardona said in a statement. “For far too long, Corinthian engaged in the wholesale financial exploitation of students, misleading them into taking on more and more debt to pay for promises they would never keep.”
In 2010, Corinthian Colleges enrolled more than 110,000 students at 105 campuses, CNN reported.
“It’s really hard to overstate how transformative this is going to be for hundreds of thousands of people,” Thomas Gokey, a founder of the Debt Collective activist group, told Times.
Vice President Kamala Harris, who was California’s attorney general in 2013, filed a lawsuit accusing the company of a “predatory scheme” aimed mostly at lower-income students, the Los Angeles Times reported.
San Francisco Superior Court Judge Curtis Karnow ruled in 2016 that the company misled students about job placement rates for its graduates and advertised degree programs it did not offer, according to the newspaper.
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