Borrower Defense Claims Surpass 750,000. Consumers Empowered. Subprime Colleges and Programs Threatened.

The Higher Education Inquirer has posted a number of articles about student loan debt. In 2023, the student loan mess has reached epic proportions. Not only has the US Federal Student Aid debt portfolio reached more than $1.6 Trillion, we learned that $674 Billion was estimated to be unrecoverable. 

In California, the US District Court in Sweet v Cardona agreed to a $6 Billion settlement between student debtors and the US Department of Education. 

In Texas, a group representing for-profit colleges has sued the US Department of Education for their actions in settling Borrower Defense claims. 

And across the US, about 40 million student debtors and their families are awaiting a decision from the US Supreme Court—a decision that will not likely favor the debtors.

Borrower Defense, Subprime Colleges, Subprime Programs

Borrower Defense to Repayment claims are claims by student loan debtors that their school misled them or engaged in other misconduct in violation of certain state laws. The Department of Education may discharge all or some of the student loan debt and hold the school and its owners responsible. 

As of January 2023, there are more than three quarters of a million Borrower Defense claims against schools. And each month, about 16,000 new claims are added.  Evidence from the Sweet v Cardona case revealed that only about 35 workers were responsible for processing hundreds of thousands of claims. Those claims have been disproportionately made against a number of for-profit colleges and formerly for-profit colleges, what we call “subprime colleges.”   

Some of these subprime schools have closed (Everest College, ITT Tech, and Westwood College for example), some remain in business as for-profit colleges (like University of Phoenix and Colorado Tech), some have changed names and become covert for-profit colleges or robocolleges (like Purdue University Global, University of Arizona Global Campus, and the Art Institutes), and some schools act act like subprime colleges regardless of tax status. This includes low-return on investment programs at several US robocolleges and overly expensive graduate programs offered by 2U, an online program manager for elite colleges.  

In the Sweet v Cardona case, more than 200,000 student borrowers are expecting to receive full debt relief after years of struggling.  A Facebook group Borrower Defense-Sweet vs. Cardona currently has more than 14,000 members. 

Named plaintiffs Theresa Sweet (L) and Alicia Davis (R) outside the federal district court in San Francisco on November 6, 2022, three days before the final approval hearing in Sweet v Cardona (Image credit: Ashley Pizzuti)

Transparency and Accountability 

The US Department of Education keeps an accounting of Borrower Defense claims, but only publishes the aggregate numbers, not institutional numbers. Those institutional numbers do make a difference in promoting transparency and accountability for the largest bad actors. So why does the Department of Education not publish those institutional numbers?

 
The National Student Legal Defense Network submitted a FOIA (22-01683F) to the US Department of Education (ED) in January 2022 asking just for that information. And what HEI has discovered is that just a small number of schools garnered the lion's share of the Borrower Defense claims. To get a digital copy of that information, please email us for a free download.

Related links:

Borrower Defense-Sweet vs Cardona (Facebook private group)  

Project on Predatory Student Lending

Sweet v. Cardona Victory (Matter of Life and Debt podcast)

I Went on Strike to Cancel My Student Debt and Won. Every Debtor Deserves the Same. (Ann Bowers)

An Email of Concern to the People of Arkansas about the University of Phoenix (Tarah Gramza)

People's Rally for Student Debt Cancellation to be held outside Supreme Court, February 28, 2023

 
A Letter to the US Department of Education and Student Loan Servicers on Behalf of Student X (Heidi Weber)  

The Growth of "RoboColleges" and "Robostudents"

Subprime College Crash Continues Under the Radar

2U Virus Expands College Meltdown to Elite Universities

Maximus, Student Loan Debt, and the Poverty Industrial Complex

 
More Transparency About the Student Debt Portfolio Is Needed: Student Debt By Institution  

The Future of Federal Student Loans

The U.S. student loan system, now exceeding $1.7 trillion in debt and affecting over 40 million borrowers, is facing significant challenges. As political pressures rise, the management of student loans could be significantly altered. A combination of potential privatization, the elimination of the U.S. Department of Education (ED), and a new role for the Department of the Treasury raises critical questions about the future of the system.

U.S. Department of Education: Strained Resources and Outsourcing

The U.S. Department of Education (ED) is responsible for managing federal student loan servicing, loan forgiveness programs, and borrower defense to repayment (BDR) claims. However, ED has faced ongoing issues with understaffing and inefficiency, particularly as many functions have been outsourced to contractors. Companies like Maximus (including subsidiaries like AidVantage) manage much of the administrative burden for loan servicing. This has raised concerns about accountability and the impact on borrowers, especially those seeking loan relief.

In recent years, ED has also experienced staff reductions and funding cuts, making it difficult to process claims or maintain high-quality service. The potential for further cuts or even the elimination of the department could exacerbate these problems. If ED’s role is diminished, other entities, such as the Department of the Treasury, could assume responsibility for managing the student loan portfolio, though this would present its own set of challenges.

Potential for Privatization of the Student Loan Portfolio

One of the most discussed options for addressing the student loan crisis is the privatization of the federal student loan portfolio. Under previous administration discussions, including those during President Trump’s tenure, there were talks about selling off parts of the student loan portfolio to private companies. This would be done with the aim of reducing the federal deficit.

In 2019, McKinsey & Company was hired by the Trump administration to analyze the value of the student loan portfolio, considering factors such as default rates and economic conditions. While the report's findings were never made public, the idea of transferring the loans to private companies—such as banks or investment firms—remains a possibility.

The consequences of privatizing federal student loans could be significant. Private companies would likely focus on profitability, which could result in stricter repayment terms or less flexibility for borrowers seeking loan forgiveness or other relief options. This shift may reduce borrower protections, making it harder for students to challenge repayment terms or pursue loan discharges.

The Department of the Treasury and its Potential Role

If the U.S. Department of Education is restructured or eliminated, there is a possibility that the Department of the Treasury could step in to manage some aspects of the student loan portfolio. The Treasury is responsible for the country’s financial systems and debt management, so it could, in theory, handle the federal student loan portfolio from a financial oversight perspective.

However, while the Treasury has experience in financial management, it lacks the specialized knowledge of student loans and borrower protections that the Department of Education currently provides. For example, the Treasury would need to find ways to process complex Borrower Defense to Repayment claims, a responsibility ED currently manages. In 2023, over 750,000 Borrower Defense claims were pending, with thousands of claims related to predatory practices at for-profit colleges such as University of Phoenix, ITT Tech, and Kaplan University (now known as Purdue Global). Additionally, some of these for-profit schools were able to reorganize and continue operating under different names, further complicating the situation.

The Treasury could also contract out loan servicing, but this could increase reliance on profit-driven companies, possibly compromising the interests of borrowers in favor of financial performance.

Borrower Defense Claims and the Impact of For-Profit Schools

A large portion of the Borrower Defense to Repayment claims comes from students who attended for-profit colleges with a history of deceptive practices. These institutions, often referred to as subprime colleges, misled students about job prospects, program outcomes, and accreditation, leaving many with significant student debt but poor employment outcomes.

Data from 2023 revealed that over 750,000 Borrower Defense claims were filed with the Department of Education, many of them against for-profit institutions. The Sweet v. Cardona case showed that more than 200,000 borrowers were expected to receive debt relief after years of waiting. However, the process was slow, with an estimated 16,000 new claims being filed each month, and only 35 ED workers handling these claims. These delays, combined with the uncertainty around the future of ED, leave borrowers vulnerable to prolonged financial hardship. 

Lack of Transparency and Accountability in the System

While the U.S. Department of Education tracks Borrower Defense claims, it does not publish institutional-level data, making it difficult to identify which schools are responsible for the most fraudulent activity. 

In response to this, FOIA requests have been filed by organizations like the National Student Legal Defense Network and the Higher Education Inquirer to obtain detailed information about which institutions are disproportionately affecting borrowers. 

In one such request, the Higher Education Inquirer asked for information regarding claims filed against the University of Phoenix, a school with a significant number of Borrower Defense claims.

The lack of transparency in the system makes it harder for borrowers to make informed decisions about which institutions to attend and limits accountability for schools that have harmed students. If the Treasury or private companies take over management of the loan portfolio, these transparency issues could worsen, as private entities are less likely to prioritize public accountability.

Conclusion

The future of the U.S. student loan system is uncertain, particularly as the Department of Education faces the potential of funding cuts, staff reductions, or even complete dissolution. If ED’s role diminishes or disappears, the Department of the Treasury could take over some functions, but this would raise questions about the fairness and transparency of the system.

The possibility of privatizing the student loan portfolio also looms large, which could shift the focus away from borrower protections and toward financial gain for private companies. For-profit schools, many of which have a history of predatory practices, are responsible for a disproportionate number of Borrower Defense claims, and any move to privatize the loan portfolio could exacerbate the challenges faced by borrowers seeking relief from these institutions.

Ultimately, there is a need for greater transparency and accountability in how the student loan system operates. Whether managed by the Department of Education, the Treasury, or private companies, protecting borrowers and ensuring fairness should remain central to any future reforms. If these issues are not addressed, millions of borrowers will continue to face significant financial hardship.

HEI Files FOIA to Expose Delays and Disparities in Borrower Defense Discharges

The Higher Education Inquirer has submitted a Freedom of Information Act (FOIA) request to the U.S. Department of Education, seeking critical data on Borrower Defense to Repayment claims tied to some of the most notorious for-profit and career college chains in the United States. Filed on July 13, 2025, and formally acknowledged by the Department on July 14, this request seeks to uncover how many borrowers have received student debt relief, how many remain in limbo, and how many have been left in the dark despite being eligible.

The FOIA request includes a list of institutions with long histories of documented fraud, federal investigations, lawsuits, and closures. These include Corinthian Colleges (which operated Everest, Heald, and WyoTech), ITT Technical Institute, Westwood College, Marinello Schools of Beauty, the Art Institutes, Argosy University, American National University, Charlotte School of Law, DeVry University, Globe University/Minnesota School of Business, Independence University, Kaplan College/Kaplan University, Le Cordon Bleu, Missouri College, Mount Washington College, University of Phoenix, Virginia College, and Vatterott College.

For each institution, the Inquirer is requesting the number of borrowers identified for group discharge under the Borrower Defense authority. Of those, we are asking how many have had their loans discharged, how many cases remain pending, how many borrowers have been approved for discharge but not yet notified, and how many claims overlap with the class-action lawsuit Sweet v. McMahon (formerly Sweet v. Cardona and Sweet v. DeVos). For Corinthian Colleges specifically, the request also asks for the number of discharged borrowers under previous Department announcements and how many were also part of the Manriquez v. McMahon or Sweet settlements.

This data request covers the one-year period from July 13, 2024, to July 13, 2025, and asks for results in a structured, electronic format, preferably Excel.

The significance of this request cannot be overstated. Despite multiple well-publicized borrower defense settlements and mass discharge announcements, many defrauded students still have no clear idea whether they qualify for relief or when it might arrive. While the Department has made headlines for forgiving billions in student debt, especially for borrowers from predatory for-profit schools, those announcements often lack transparency and specificity. The FOIA request aims to fill those gaps and provide an accurate picture of the Department’s implementation of debt relief and justice for defrauded borrowers.

The Department of Education’s FOIA Service Center responded that the request has been received and is in queue. No further clarification is needed at this time, and no fees have been assessed. The Department did note that the current average processing time is 185 business days—over nine months. This timeline means that meaningful public disclosure may not happen until spring 2026, even as policymakers, advocates, and student debtors continue to push for faster relief and more accountability.

This FOIA request is part of the Higher Education Inquirer's ongoing efforts to investigate the afterlife of failed for-profit colleges, the bureaucratic delays in loan discharges, and the long shadow these schools have cast over the lives of working-class students. In many cases, these students were the first in their families to attend college and were aggressively targeted by institutions that promised fast-track careers and delivered financial ruin instead.

We will continue to monitor the Department’s response and will publish any findings we receive. If you are a former student of one of these schools and have filed a Borrower Defense claim—or have questions about whether you qualify—we invite you to share your experience. Your voice matters, and transparency is key to understanding how widespread the damage remains.

Contact the Higher Education Inquirer at gmcghee@aya.yale.edu.

Sources
U.S. Department of Education FOIA Acknowledgment Letter, July 14, 2025
FOIA Request No. 25-04397-F
Sweet v. Cardona (formerly Sweet v. DeVos), Case No. 19-cv-03674, N.D. Cal.
Manriquez v. DeVos, Case No. 3:17-cv-07210, N.D. Cal.
U.S. Department of Education Borrower Defense Updates – studentaid.gov

Borrower Defense Case Goes to US Supreme Court. How will it decide?

On January 10, 2025, the U.S. Supreme Court granted the Department of Education’s petition for a writ of certiorari to review the U.S. Court of Appeals for the Fifth Circuit’s decision in Career Colleges and Schools of Texas v. Department of Education. The Fifth Circuit had preliminarily enjoined the 2022 Borrower Defense to Repayment (BDR) final rule on a nationwide basis. This rule, published on November 1, 2022 (87 Fed. Reg. 65,904), is a key component of the Biden administration’s broader student loan forgiveness efforts.

The Supreme Court’s review will focus on one pivotal question: whether the court of appeals erred in holding that the Higher Education Act does not permit the assessment of borrower defenses to repayment before default, in administrative proceedings, or on a group basis. Notably, the Court will not address the second question posed by the Department: whether the appeals court erred in ordering the district court to grant preliminary relief on a universal basis.

Background and Legal Battle

The lawsuit originated on February 28, 2023, when the Career Colleges and Schools of Texas (CCST) filed in the United States District Court for the Northern District of Texas. CCST sought to enjoin and vacate the 2022 BDR rule, arguing that it creates unlawful processes, serves no legitimate purpose under the Higher Education Act, and constitutes executive overreach by the Biden administration, violating the Department’s statutory authority and the Constitution’s separation of powers.

After the U.S. District Court for the Western District of Texas denied the preliminary injunction, CCST pursued an interlocutory appeal to the Fifth Circuit. On April 4, 2024, the Fifth Circuit overturned the lower court’s decision and, despite the Department’s objections, postponed the effective date of the 2022 BDR rule pending final judgment. The Department’s petition for rehearing was denied, prompting its appeal to the Supreme Court.

What’s at Stake

The Supreme Court’s decision will likely have significant consequences for both borrowers and institutions. If the Court rules against the Department of Education, it could severely limit the scope of borrower defense claims, especially on a group basis, making it harder for defrauded students to receive relief. For-profit colleges and other institutions might feel emboldened to challenge similar regulations and forgiveness measures.

A ruling in favor of the Department, while seemingly less likely given the Court’s conservative majority, would affirm the Biden administration’s approach to processing borrower defenses and may secure loan forgiveness for thousands of borrowers who attended predatory institutions.

The Political Dimension

The timing of this case is crucial. Just days before the Supreme Court granted certiorari, the Biden administration announced the cancellation of loans for 150,000 borrowers—most of which were through the borrower defense process. Shortly afterward, additional forgiveness for income-based repayment plan borrowers and individual borrower defense approvals was announced. However, the future of these forgiveness efforts remains uncertain, as the second Trump administration has signaled intentions to rollback or revise Biden’s loan forgiveness policies.

A Conservative Court’s Approach to Executive Power

Given the Supreme Court’s current composition and its recent track record in cases like West Virginia v. EPA, it seems likely that the justices will scrutinize the executive authority wielded in crafting the BDR rule. The conservative majority may favor a narrow interpretation of the Higher Education Act, signaling that large-scale forgiveness should come from Congress rather than executive agencies.

Conclusion

The Supreme Court’s ruling on the 2022 BDR rule will set a precedent that could define the future of student debt relief and the Department of Education’s authority. For borrowers hoping for widespread relief, the outcome could mean the difference between long-awaited forgiveness and a protracted legal battle. For institutions, particularly for-profits, a ruling against the Department could bolster their resistance to accountability measures.

Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; Comment Request; Borrower Defense to Loan Repayment Universal Forms

A Notice by the Education Department on 05/19/2025

Department of Education[Docket No.: ED-2025-SCC-0002]

AGENCY:

Federal Student Aid (FSA), Department of Education (ED).

ACTION:

Notice.

SUMMARY:

In accordance with the Paperwork Reduction Act (PRA) of 1995, the Department is proposing a revision of a currently approved information collection request (ICR).

DATES:

Interested persons are invited to submit comments on or before June 18, 2025.

ADDRESSES:

Written comments and recommendations for proposed information collection requests should be submitted within 30 days of publication of this notice. Click on this link www.reginfo.gov/​public/​do/​PRAMain to access the site. Find this information collection request (ICR) by selecting “Department of Education” under “Currently Under Review,” then check the “Only Show ICR for Public Comment” checkbox. Reginfo.gov provides two links to view documents related to this information collection request. Information collection forms and instructions may be found by clicking on the “View Information Collection (IC) List” link. Supporting statements and other supporting documentation may be found by clicking on the “View Supporting Statement and Other Documents” link.

FOR FURTHER INFORMATION CONTACT:

For specific questions related to collection activities, please contact Carolyn Rose, 202-453-5967.

SUPPLEMENTARY INFORMATION:

The Department is especially interested in public comment addressing the following issues: (1) is this collection necessary to the proper functions of the Department; (2) will this information be processed and used in a timely manner; (3) is the estimate of burden accurate; (4) how might the Department enhance the quality, utility, and clarity of the information to be collected; and (5) how might the Department minimize the burden of this collection on the respondents, including through the use of information technology. Please note that written comments received in response to this notice will be considered public records.

Title of Collection: Borrower Defense to Loan Repayment Universal Forms.

OMB Control Number: 1845-0163.

Type of Review: A revision of a currently approved ICR.

Respondents/Affected Public: Individuals and Households.

Total Estimated Number of Annual Responses: 83,750.

Total Estimated Number of Annual Burden Hours: 217,750.

Abstract: On April 4, 2024 the U.S. Court of Appeals of the Fifth Circuit granted a preliminary injunction against 34 CFR 685.400 et seq. (“2023 Regulation”) enjoining the rule and postponing the effective date of the regular pending final judgment in the case. The current Borrower Defense to Repayment application and related Request for Reconsideration are drafted to conform to the enjoined provisions of the 2023 Regulation. This request is to revise the currently approved information collection 1845-0163 to comply with the regulatory requirements of the borrower defense regulations that are still in effect, 34 CFR 685.206(e) (“2020 Regulation”), 34 CFR 685.222 (“2016 Regulation”), and 34 CFR 685.206(c) (“1995 Regulation”) (together, the “current regulations”). These regulatory requirements are distinct from the 2023 Regulation's provisions. The revision is part of contingency planning in case the 2023 Regulation is permanently struck down. The Department of Education (“the Department”) is attaching an updated Borrower Defense Application and application for Request for Reconsideration. The forms will be available in paper and electronic forms on studentaid.gov and will provide borrowers with an easily accessible and clear method to provide the information necessary for the Department to review and process claim applications. Also, under the current regulations, the Department will no longer require a group application nor group reconsideration application.


Dated: May 13, 2025.

Brian Fu,

Program and Management Analyst, Office of Planning, Evaluation and Policy Development.


[FR Doc. 2025-08857 Filed 5-16-25; 8:45 am]

BILLING CODE 4000-01-P
Published Document: 2025-08857 (90 FR 21296)

University of Phoenix and the Ash Heap of Higher Ed History

 (Updated September 14, 2023)

The University of Phoenix (or at least its name) may soon enter the ash heap of US higher education history--and rise again as a state-run robocollege.  But it shouldn't--at least not yet. Once hailed as the leader in affordable adult education for workers entering middle management, it is a shell of its former self--in an economy less certain for workers and consumers. 

With the school's wreckage are approximately one million people buried alive in an estimated $14B-$35B in student loan debt.  

Pattern of Fraud

As of January 2023, more than 69,000 of these student loan debtors have filed Borrower Defense to Repayment fraud claims with the US Department of Education against the University of Phoenix (UoPX). Many more could file claims when they become aware of their rights to debt relief. In the partial FOIA response below, the US Department of Education reported that 69,180 Borrower Defense claims had been made against the school.

In a recent federal case, Sweet v Cardona, most if not all of the 19,860 "denied" cases were overturned in favor of the student loan debtors.  We estimate the smaller number of fraud claims alone to amount to hundreds of millions of dollars.  

Through a FOIA request, we also discovered 6,265 consumer complaints in the FTC database. In 2019, the FTC and the University of Phoenix settled a claim for $191M for deceptive employment claims.  Based on the consumer complaints, we have no reason to believe that Phoenix has changed its behavior as a bad actor. 

On May 3, 2023, six US Senators (Warren, Brown, Blumenthal, Durbin, Merkley, Hassan) called for the US Department of Education, Department of Veterans Affairs, and Department of Defense to investigate the University of Phoenix for launching a new program suggesting that it was a public university.  The letter stated that the school "has long preyed on veterans, low-income students, and students of color."

Wolves in Sheep's Clothing

University of Phoenix's owners could potentially be liable for refunding the US government for the fraud. But as a state-related organization, it may be more politically difficult to claw back funds, no matter how predatory the school is.  

Purdue University Global and University of Arizona Global set a precedence in state-related organizations acquiring subprime schools (Kaplan University and Ashford University) and rebranding them as something better. Whether they are better for consumers is questionable. Phoenix will have to cut costs, largely by reducing labor. Using Indian labor (like Purdue Global) and AI could be profitable strategies.  It's likely that this deal, even if profitable, will add fuel to the growing skepticism of higher education in the US. 

University of Phoenix's Finances

Apollo Global Management and Vistria Group currently own University of Phoenix but have been trying (unsuccessfully) to unload the subprime college for more than two years. Little is publicly known about the school's finances. What is known is that UoPX gets about $800M every year from the federal government, through federal student loans, Pell Grants, GI Bill funds, and DOD Tuition Assistance.

Despite this government funding, US Department of Education data show the school's equity value for the Arizona segment declined significantly, from $361M in FY 2018 to $187M in FY 2021. 

$347M of the University of Phoenix's $518M in assets are intangible assets. Intangible assets typically include intellectual property and brand reputation. The school has $348M in liabilities.  

The University of Phoenix has been reducing expenses by cutting instructional costs, from $70M in FY 2020 to $60M in FY 2021. UoPX spends about 8 percent of its revenues on instruction.

Marketing and advertising expenses are not available, but Phoenix has been visible on the Discovery Channel's Shark Week, CBS' Big Brother, and other television events. ISpot.tv reports that University of Phoenix spends millions of dollars each year on television ads.  On one ad alone, the ad spend from February 2023 to July 2023 was an estimated $3.5M. 

Attempts to Sell UoPX

There have been two known potential buyers for the University of Phoenix: the University of Arkansas System and the University of Idaho. In both cases, the owners required the potential buyers to keep the deal secret until the sale was imminent.  

Fear of the impending higher education enrollment cliff appears to be an important pitch to potential buyers. 

Arkansas, the first target, was in the process of making the deal, and it might have gone through if nit for the voice of one whistleblower and one outstanding investigative reporter, Debra Hale Shelton of the Arkansas Times.

In the case of Idaho, news of the potential deal was publicly noted just one day before the preliminary agreement was made with the Idaho Board of Education. Two other secret meetings were held before that.  

A number of journalists including Kevin Richert (Idaho EdNews), Laura Guido (The Idaho Press), Troy Oppie (Boise State Public Radio), and Noble Brigham (Idaho Statesman) have exposed some of the problems and potential problems with the deal.  In June, Idaho legislators began questioning the acquisition.  

More recently, the opinion editor at the Idaho Statesman argued that the deal may actually be worthwhile. 

Particulars about the finances are sketchy at best and misleading at worst.  The University of Phoenix is said to include $200M in cash in the deal, but they have not said how much of that sum is required by law as "restricted cash"--money the school needs if the Department of Education needs to claw back funds.  Phoenix also claims to be highly profitable, but without showing any evidence.  

What is known about the deal is that the University of Idaho will have to borrow $685M and put its (bond) credit rating at risk. The school has not identified important information how the bonds would be sold (underwriters, bond raters, date to maturity, interest rate). 

The University of Idaho has created an FAQ to answer questions about the sale, but HEI has identified a number of misleading statements about University of Phoenix's present finances (failure to report the school's equity), potential liability (cost of tens of thousands of Borrower Defense claims), and leadership (lack of background information about Chris Lynne, the President of the University of Phoenix).  These deficiencies have been reported to the University of Idaho and to the Representative Horman. 

On June 20, Idaho Attorney General Raul Labrador filed a lawsuit to halt, or at least slow down the deal. 

The University of Idaho submitted a Pre-Acquisition Review from the US Department of Education, and it may take up to three months before the application is completed. 

As of September 2023, the deal is far from done.  Since this article was first published there have been a number of developments:

On September 11,  US Senators Elizabeth Warren, Dick Durbin, and Richard Blumenthal called on University of Idaho President Green to abandon the sale.  The Senators also asked Green if he had a plan to pay for the Borrower Defense claims, noting that University of Arizona may be on the hook for thousands of claims against Ashford University (aka University of Arizona Global campus).

In November, the Joint Finance-Appropriations Committee of the Idaho Legislature is expected to discuss the issue again.

*The Higher Education Inquirer has made a FOIA request for more up-to-date numbers from the US Department of Education. We have also filed FOIA requests with the FTC. 

Related link: 

How University of Phoenix Failed. It's a Long Story. But It's Important for the Future of Higher Education.

The Growth of "RoboColleges" and "Robostudents"

More Transparency About the Student Debt Portfolio Is Needed: Student Debt By Institution

Borrower Defense Claims Surpass 750,000. Consumers Empowered. Subprime Colleges and Programs Threatened.

Seventh Quarterly Report under Settlement Agreement in Sweet, et al. v. Cardona (US Department of Education)

The latest report regarding Borrower Defense to Repayment settlements has been published. National Student  Loan Data System records indicate that discharges have been fully processed for at least 195,5908 Class Members eligible for relief. Refunds have been fully processed for at least 194,782 Class Members eligible for relief.  

Borrower Defense to Repayment is a debt forgiveness strategy for consumers if they believe they were defrauded by a school and can document that fraud. The Project on Predatory Student Lending (PPSL) has provided assistance to thousands of consumers defrauded by for-profit colleges and still offers help. 

For consumer support regarding about Borrower Defense claims, we also recommend joining the r/Borrower Defense group on Reddit.  

Trump's Department of Education Continues to Drag Feet on Borrower Defense

On June 26th, the US Department of Education was brought to the Ninth District Court (and Judge Alsup) to show how many the Borrower Defense to Repayment cases that have been resolved per court order.  

While we wait for a transcript of the latest episode of Sweet v McMahon, what we can tell you is that the Trump government continues to drag its feet in paying back debtors who have been defrauded.  

According to Theresa Sweet:

“We really need Borrower Defense applicants included in both the full and post class of Sweet to send any denials to the Project on Predatory Student Lending. It’s important for the legal team to be able to track this and make sure there are no patterns of boilerplate denials or mass denials. It’s also really important to remember that if a Sweet class or post class member gets a denial it should include a Revise and Resubmit notice, which *must* be resubmitted on time or the denial becomes final unless the person takes it to court on their own.”

More than 950.000 student loan debtors have filed borrower defense fraud claims.

Fraud Claims Against University of Phoenix Continue to Grow

The Higher Education Inquirer received a FOIA response today from the US Department of Education stating that 73,740 consumer fraud claims have been filed against the University of Phoenix. These claims have been made through the Department of Education's Borrower Defense to Repayment program.

The Sweet v Cardona lawsuit, concluded earlier in 2023, allowed for about 19,000 claims to be settled immediately--in favor of student debtors and against the University of Phoenix. Another 15,000 or so cases are supposed to be expedited as a result of the federal ruling.  

23-02373-F Final Response

We estimate that the potential liability of these immediate claims to be $200M-$600M with another $500M-$1.5B for the remaining cases. The higher estimates are based on the median federal loan debt among borrowers who completed their undergraduate degree ($32,421) and a study by Adam Looney and Constantine Yannelis that indicated University of Phoenix debtors, on average, paid off almost nothing of their principal. The authors also estimated that total student loan debt from more than a million University of Phoenix debtors was $35B. 

The Department of Education has not presented any estimates on the total debt by University of Phoenix students or its costs to the US government.  

Thousands of new cases continue to be filed. From January 2015 through January 1, 2022, there were 32,040 Borrower Defense claims made against the University of Phoenix. An additional 41,700 claims were filed between 2022 and August 2023. 

Idaho Sale

University of Phoenix's current owners are Apollo Global Management and Vistria Group, who have been trying to unload the online robocollege for years. The University of Idaho has been the most recent target, but the sale is far from being consummated.  The entire deal is expected to cost $685M. Idaho Attorney General Raul Labrador has filed a lawsuit to stop or at least slow down the acquisition. And members of the Idaho Legislature continue to have questions.

In order to shield itself from liability the University of Idaho created a non-profit organization called 43 Education. But the state university may be responsible if the non-profit fails to make enough money to repay the bondholders of the new non-profit. 

The liability of these Borrower Defense claims to the current or future owners of the University of Phoenix seems possible in light of a recent statement by Department of Education Undersecretary James Kvaal. Kvaal said the University of Arizona Global Campus may be liable for the misdeeds of Ashford University (UAGC's former name). The University of Arizona purchased Ashford in 2020 for one dollar. 

Related articles:

Feds Cancel Loans for 2,300 Students Scammed by Ashford U. So Why Does the School Still Get Tax Dollars? (David Halperin)

University of Phoenix and the Ash Heap of Higher Ed History

Borrower Defense Claims Surpass 750,000. Consumers Empowered. Subprime Colleges and Programs Threatened.

The Growth of "RoboColleges" and "Robostudents"

More Transparency About the Student Debt Portfolio Is Needed: Student Debt By Institution

 

People's Rally for Student Debt Cancellation to be held outside Supreme Court, February 28, 2023

[Update: This event will be livestreamed at https://www.cancelmystudentdebt.org/peoples-rally-livestream ] 

Sign up for the People's Rally for Student Debt Cancellation to be held outside the US Supreme Court, Tuesday morning, February 28, 2023.  And please share this event with people in your network. 

The Supreme Court case involves the constitutionality of President Biden's order to cancel more than $400 billion in student loan debt, that according to the NY Fed would provide a disproportionate amount of relief to low and middle-income families. 

Supporters of the People's Rally include the Debt Collective, NAACP, National Urban League, American Federation of Teachers, National Education Association, SEIU, the National Consumer Law Center, Young Invincibles, and Move On. Senator Elizabeth Warren will be one of the speakers. 

While there is no substitute for People on the ground, folks can also attend online.  

Before the hearing, the People are invited to use the #CancelItSCOTUS! hashtag and flood Twitter with personal and shared stories of why the cancellation is so vital. Access the toolkit to join the Twitterstorm on 2/28 at 9-11am.

Currently, there are about 45 million Americans carrying student loan debt. Based on our interpretation of the 2022 Financial Student Aid Annual Report, about 40 percent of the federal student loan debt portfolio ($674 Billion of $1.7 Trillion) is unrecoverable.* 

Meanwhile, student loan debt collectors like Maximus receive hundreds of millions of dollars from the US government while sometimes using unethical and predatory business practices. 

Students who attended subprime schools or who had low financial value majors have been hardest hit. And the debt takes its toll on millions of citizens, their families, and their communities--and reduces their opportunities to live the American Dream. 

About 200,000 student debtors who were defrauded by subprime schools are also facing a legal battle in the 9th Circuit Court to have their debt forgiven. Hundreds of thousands more have filed Borrower Defense to Repayment claims and are awaiting for decisions that can take several years, due to  understaffing and an enormous backlog at the US Department of Education.

 

So far, ED has only approved Borrower Defense to Repayment claims from a handful of closed schools, and it appears that victims of fraud from other subprime schools, like the University of Phoenix, have received blanket denials.  

Pushing back against the debtors, Republican lawmakers are calling for mandatory loan repayments to restart.  

Stay tuned to this post for more information.  #strikedebt 

 *We have asked the US Department of Education press team for a comment, but they have not responded, which is often the case.

Related link: I Went on Strike to Cancel My Student Debt and Won. Every Debtor Deserves the Same. (Ann Bowers*) 

Related link: Assessing the Relative Progressivity of the Biden Administration’s Federal Student Loan Forgiveness Proposal (NY Fed)

Related link:  Federal Student Aid FY 2022 Annual Report 

Related link: Sweet v Cardona (Borrower Defense to Repayment) 

Related link: Maximus, Student Loan Debt, and the Poverty Industrial Complex 

Related link: Borrower Defense to Repayment Loan Forgiveness Data

Corinthian Colleges: A For-Profit Empire, Lifelong Debt, and No Justice for the Victims

In the pantheon of higher education scandals, few match the scale and damage caused by Corinthian Colleges Inc. (CCI). Once hailed by Wall Street as a model for the future of "career education," Corinthian collapsed in 2015 amid federal investigations, lawsuits, and public outrage. The company left behind a trail of financial ruin: more than half a million former students burdened with life-altering debt and degrees of little or no value.

And yet—no one went to jail.

 
A Machine Built on Deception

Founded in 1995, Corinthian Colleges grew rapidly by acquiring small vocational schools and rebranding them under the names Everest, Heald, and WyoTech. Backed by investors and pumped with federal financial aid dollars, the company aggressively marketed to low-income individuals, single mothers, veterans, and people of color—those often excluded from traditional higher education.

Its business model depended not on education outcomes, but on enrollment numbers and federal subsidies. Behind its TV commercials and high-pressure call centers, Corinthian was fabricating job placement rates, enrolling unqualified students, and saddling them with tens of thousands in debt for programs that were often substandard or unaccredited.

At its peak, Corinthian enrolled more than 100,000 students and took in over $1.4 billion annually in federal aid.

 
The Collapse and the Fallout

In 2014, under pressure from federal and state regulators—particularly California Attorney General Kamala Harris—the U.S. Department of Education began tightening scrutiny. When CCI failed to provide accurate job placement data, the government cut off access to Title IV funds. Corinthian tried to sell off its campuses piecemeal before declaring bankruptcy in 2015.

The closure stranded tens of thousands of students mid-degree and left hundreds of thousands with massive debt for worthless credentials.
Lifelong Damage

Many Corinthian students never recovered. Some lost years of work and study. Many saw their credit scores destroyed. Others defaulted and faced wage garnishment, loss of tax refunds, and psychological trauma.

Although the Biden administration in 2022 announced $5.8 billion in loan cancellation for more than 560,000 former Corinthian students—the largest discharge of federal student loans in U.S. history—many students were excluded. Others had taken out private loans or never received proper notification. Some died before receiving relief. Others continue to pay interest on fraudulent debts.

 
The Executives Who Walked Away

While students and their families were left in financial ruin, Corinthian’s executives escaped virtually untouched.

Jack D. Massimino, Corinthian’s longtime CEO and chairman, collected millions in compensation over the years—reportedly more than $3 million in a single year (2010). Despite leading the company through its most fraudulent period, Massimino was never criminally charged. He quietly disappeared from public view after the company’s collapse.

Patrick J. Carey, former Chief Operating Officer and later CEO after Massimino stepped down, also avoided prosecution. Carey was involved in the company’s operations during the period when job placement numbers were allegedly falsified.

William D. White, former Chief Financial Officer, signed off on SEC filings during years of misleading statements to investors and regulators, yet he too faced no criminal charges.

A handful of lawsuits and civil enforcement actions targeted the company, but not its top brass. The Obama-era Department of Education fined Corinthian $30 million for misrepresentations at its Heald campuses in California—but again, no individuals were held accountable.

The Securities and Exchange Commission (SEC) filed a civil suit in 2016 against Massimino and two other executives—Robert Owen (former CEO of Everest) and David Moore (former Vice President of Career Services)—but the penalties were civil, not criminal. The matter was quietly resolved years later, with no admission of guilt and limited financial penalties.

 
A Legal and Regulatory Failure

The failure to prosecute Corinthian’s leadership reveals the broader dysfunction of federal oversight. The Department of Education continued to funnel billions to Corinthian even after whistleblowers and state attorneys general raised serious concerns. Accreditors rubber-stamped programs with low graduation and job placement rates. Congress held hearings but passed little reform.

And when the reckoning came, it was the students—not the executives or shareholders—who paid the price.

 
A Cautionary Tale Still Unfolding

The Corinthian Colleges scandal is not simply a story of corporate greed. It is a story of systemic complicity—of a regulatory system that rewards enrollment over outcomes, that protects corporate actors while ignoring the human cost.

Today, many former Corinthian students remain in financial limbo, excluded from relief due to paperwork errors, technicalities, or bureaucratic delays. Some have moved on, but with scars—financial, emotional, and psychological—that may never fully heal.

Meanwhile, the men who engineered this billion-dollar fraud have retired or moved on to new ventures. Their profits are intact. Their reputations barely scratched.

Borrower Defense to Repayment: A Broken Lifeline

In theory, Borrower Defense to Repayment (BDR) was supposed to be the lifeline for students defrauded by predatory institutions like Corinthian Colleges. Enshrined in federal law since the 1990s and expanded during the Obama administration, BDR allows borrowers to seek federal student loan cancellation if their school misled them or violated certain state laws. In practice, however, this “safety net” has been riddled with delay, denial, and political sabotage.

During the Trump administration, then-Education Secretary Betsy DeVos all but dismantled BDR, slow-walking or denying tens of thousands of claims and rewriting the rules to make relief nearly impossible to obtain. Her Department of Education sat on a mountain of applications, many of them from Corinthian students, and forced some defrauded borrowers to repay loans they never should have owed.

Legal battles ensued. A class action suit brought by student borrowers (Sweet v. Cardona) eventually compelled the Department of Education to process tens of thousands of long-delayed claims. But the damage from years of neglect and politicization left lasting scars.

The Biden administration, to its credit, sought to restore the original intent of Borrower Defense. In 2022, it wiped out $5.8 billion in federal loans for former Corinthian students—an unprecedented act of relief. And yet, it was not complete justice.

Thousands of borrowers still have pending BDR applications. Some were denied under DeVos-era policies and must reapply. Others have struggled to access relief due to confusing eligibility requirements or missing documentation. And those with private loans—outside the reach of BDR entirely—remain stuck with illegitimate debt and few legal options.

More troubling, the system remains vulnerable to future political manipulation. Without statutory protections, BDR can be gutted again by a future administration, leaving borrowers once more at the mercy of ideology and inertia.

Corinthian’s legacy, then, lives on—not just in the ruined finances of its former students but in the unsteady scaffolding of a student loan forgiveness system still prone to failure. If Borrower Defense to Repayment is to mean anything, it must become more than a postscript to scandals like Corinthian. It must become a durable right—shielded from politics, enforced with urgency, and backed by a real commitment to justice.

The Higher Education Inquirer will continue to investigate how many were excluded, why relief was delayed, and what deeper reforms are needed—not just to help the Corinthian generation, but to prevent the next generation from falling into the same trap.

Sources:

U.S. Department of Education press releases (2015–2024)
SEC v. Massimino, Owen, Moore (2016)
California v. Corinthian Colleges, Inc. (AG Kamala Harris)
The Atlantic, “The Lie That Got Half a Million People Into Debt”
The Chronicle of Higher Education archives
Debt Collective reports and legal filings
U.S. Senate HELP Committee (Harkin Report, 2012)
Inside Higher Ed, “Corinthian Execs Walk Away”
Sweet v. Cardona case documents and related rulings
Borrower Defense regulations: 34 CFR § 685.206 and subsequent amendments

Let us know if you have a Corinthian story to share. Justice demands it be told.

Higher Education FOIA Requests to US Department of Education

The Higher Education Inquirer has made a number of Freedom of Information Act (FOIA) requests to the US Department of Education.  Here's our current list.  

 

23-01436-F 

The Higher Education Inquirer is requesting copies of the current contracts between the US Department of Education and Maximus (including but not limited to subsidiaries such as AidVantage). If this is not possible we would like the reported dollar amount for each contract. This request is part of a larger effort to assess the student loan debt portfolio. (Date Range for Record Search: From 01/01/2010 To 04/03/2023)

23-01426-F  

The Higher Education Inquirer is requesting the dollar amount of student loan funds issued to for-profit colleges each year from 1972 to 2021.  We will accept interim or partial data.  (Date Range for Record Search: From 01/01/1973 To 04/03/2022)

23-01369-F  

 

The Higher Education Inquirer is requesting an estimate of the number of student loans in the student loan portfolio that originated (1) before 1978, (2) before 1983, (3) before 1988, and (4) before 1993.  This is part of a larger effort to understand the estimated $674B in unrecoverable student loan debt.   (Date Range for Record Search: From 01/01/2023 To 03/28/2023)

23-01324-F  

 

The Higher Education Inquirer is requesting a count of the number of Borrower Defense to Repayment claims against South University and the Art Institutes, in the Consumer Engagement Management System (CEMS) up to January 1, 2023.  We would also like to know if their parent company, Education Principle Foundation (EPF), is listed as the owner of both schools in the CEMS computer database.   (Date Range for Record Search: From 01/01/2023 To 03/22/2023)

23-01263-F

 

The Higher Education Inquirer is requesting a list of all the variables/categories in the Consumer Engagement Management System (CEMS).  CEMS is mentioned in FOIA 22-01683F filed by the National Student Legal Defense Network.   (Date Range for Record Search: From 01/01/2023 To 03/16/2023)

23-00865-F 

 

We are requesting an accounting of US Department of Education Borrower Defense to Repayment (BD) claims against the University of Phoenix.  Specifically, we are asking for the (1) number of BD claims, (2) the number processed, and (3) the number approved.  The date range is from February 20, 2016 to January 26, 2023. If there is a reasonable way to estimate the total dollar amount in a timely manner, we would also like that.  This request is similar to FOIA request 22-03203-F, and is a result of discovering that the University of Arkansas System has been in negotiations to acquire University of Phoenix through a nonprofit organization.   (Date Range for Record Search: From 02/20/2016 To 01/26/2023)

 

Related links:

 

Borrower Defense Claims Surpass 750,000. Consumers Empowered. Subprime Colleges and Programs Threatened. 

 

I Went on Strike to Cancel My Student Debt and Won. Every Debtor Deserves the Same. (Ann Bowers 

 

More Transparency About the Student Debt Portfolio Is Needed: Student Debt By Institution 

 
Erica Gallagher Speaks Out About 2U's Shady Practices at Department of Education Virtual Listening Meeting  

 
An Email of Concern to the People of Arkansas about the University of Phoenix (Tarah Gramza)  

 

 

 

 

Borrower Defense Story 3: Modern Indentured Servitude (Feral Woman)

[Editor's note:  This is the third story in our series on the social and philosophical dimensions of Borrower Defense to Repayment. We hope that by sharing these stories, more people will understand why Borrower Defense is morally essential.] 

I went to school so I could lift myself out of poverty. I went and learned a trade in healthcare that I was told would have an income that would be more than enough to pay my loans. I vetted current providers in the field and learned what would be needed to be successful. 

The school made a lot of promises, but they misrepresented information and, in some cases, completely lied about our profession and our income ability. My profession at the time was averaging 25k-35k/yr in income. They told us it was 100k-125k in order to justify taking out 100k to pay for the education. 

I lived simply and thought that as long as I made 100k I could easily pay my loans back within two years. No student loan should take more than 3 years to pay back, and I had a plan to do it in two.

 
I graduated in the height of the second financial crash of my lifetime - 2007/2008. Turns out there were no jobs available prior to this crash and certainly wasn't during the crash. Opening a practice was impossible and due to illness of both myself and my partner at the time, we were in deep poverty with only a roof over our head due to family. I was able to secure a part-time job at a grocery store. During this time, I also found out that my 4 year medical degree meant nothing outside of the field I was in - also another lie from the school. I couldn't transition to any other medical profession without starting over.

I made 12- 20k a year for several years in unrelated fields, meanwhile catastrophic interest was building. Congress had also passed a law to block bankruptcy and to add capitalized interest to student loans in 2005 - which is considered predatory lending in almost all types of lending, especially for large loans. My interest rate was averaging 8%. As a former business analyst, I knew this was going to have catastrophic impacts.

Since that time, I have tried to pass a student loan bill for the last 17 years that would solve this for 95% of borrowers from the past, current and future. 

I borrowed 108k, paid 85k and I owe close to 260k for this specific degree. I have tried leaving the profession for the last 15 years but have been stuck because of the loans and no one wanting to hire me outside of my profession. I've had a few part-time jobs, but those have also dried up.

I filed for Borrowers Defense, but don't have high hopes that this will be approved under this administration, despite my school being closed down. My education has been a lifetime sentence of indentured servitude. I've been in crisis since I graduated and have never known a moment of peace. I had started to feel some hope in 2019, but lost everything and more in the pandemic and have now declared bankruptcy and will attempt an "adversarial proceeding" to get relief from my student loans as well. It will cost between 6-12k to file for adversarial proceedings with no guarantee I'll win.

I also recently found out that my IBR should have been approved in Jan 2025 for full cancellation, but instead the administration INCREASED the number of years of repayment another 12 years.

If it weren't for my son, I would have fled this country 18 years ago and started over. As it is, I'm preparing to leave because of the fear of debtors' prisons for people like me. I absolutely can not afford any additional payment to my student loans. Despite hard work to change careers and well over 3k applications in the last 4 years, not including prior to that, I keep being told my education and credentials are not enough, even in the field I'm in.

This insanity is easy to fix. Yet, neither Democrats nor Republicans have been willing to pass basic laws to restore (yes restore) sanity to education and student loans.

Biden-Harris Administration Announces Final Student Loan Forgiveness and Borrower Assistance Actions (US Department of Education)

Total Approved Student Debt Relief Reached Almost $189 Billion for 5.3 Million Borrowers

The Biden-Harris Administration today announced its final round of student loan forgiveness, approving more than $600 million for 4,550 borrowers through the Income-Based Repayment (IBR) Plan and 4,100 individual borrower defense approvals. The Administration leaves office having approved a cumulative $188.8 billion in forgiveness for 5.3 million borrowers across 33 executive actions. The U.S. Department of Education (Department) today also announced that it has completed the income-driven repayment payment count adjustment and that borrowers will now be able to see their income-driven repayment counters when they log into their accounts on StudentAid.gov. Finally, the Department took additional actions that will allow students who attended certain schools that have since closed to qualify for student loan discharges. 

“Four years ago, President Biden made a promise to fix a broken student loan system. We rolled up our sleeves and, together, we fixed existing programs that had failed to deliver the relief they promised, took bold action on behalf of borrowers who had been cheated by their institutions, and brought financial breathing room to hardworking Americans—including public servants and borrowers with disabilities. Thanks to our relentless, unapologetic efforts, millions of Americans are approved for student loan forgiveness,” said U.S. Secretary of Education Miguel Cardona. “I’m incredibly proud of the Biden-Harris Administration’s historic achievements in making the life-changing potential of higher education more affordable and accessible for more people.” 

From Day One the Biden-Harris Administration took steps to rethink, restore, and revitalize targeted relief programs that entitle borrowers to relief under the Higher Education Act but that failed to live up to their promises. Through a combination of executive actions and regulatory improvements, the Biden-Harris Administration produced the following results for borrowers: 

Fixed longstanding problems with Income-Driven Repayment (IDR). The Administration has approved 1.45 million borrowers for $57.1 billion in loan relief, including $600 million for 4,550 borrowers announced today for IBR forgiveness. 

IDR plans help keep payments manageable for borrowers and have provided a path to forgiveness after an extended period. These plans started in the early 1990s, but prior to the Biden-Harris Administration taking office, just 50 borrowers had ever had their loans forgiven. The Administration corrected longstanding failures to accurately track borrower progress toward forgiveness and addressed past instances of forbearance steering whereby servicers inappropriately advised borrowers to postpone payments for extended periods of time. These totals also include borrowers who received forgiveness under the Saving on a Valuable Education (SAVE) plan prior to court orders halting forgiveness under the SAVE plan. 

Today, the Department also announced the completion of the IDR payment count adjustment, correcting eligible payment counts. While the payment count adjustment is now complete, borrowers who were affected by certain servicer transitions in 2024 may see one or two additional months credited in the coming weeks. The Department is also launching the ability for borrowers to track their IDR progress on StudentAid.gov. Borrowers can now log in to their accounts and see their total IDR payment count and a month-by-month breakdown of progress.   

Restored the promise of Public Service Loan Forgiveness (PSLF). The Administration has approved 1,069,000 borrowers for $78.5 billion in forgiveness.  

The PSLF Program provides critical support to teachers, service members, social workers, and others engaged in public service. But prior to this Administration taking office, just 7,000 borrowers had received forgiveness and the overwhelming majority of borrowers who applied had their applications denied. The Biden-Harris Administration fixed this program by pursuing regulatory improvements, correcting long-standing issues with tracking progress toward forgiveness and misuse of forbearances, and implementing the limited PSLF waiver to avoid harm from the pandemic. 

Automated discharges and simplified eligibility criteria for borrowers with a total and permanent disability. The Administration has approved 633,000 borrowers for $18.7 billion in loan relief. 

Borrowers who are totally and permanently disabled may be eligible for a total and permanent disability (TPD) discharge. The Biden-Harris Administration changed regulations to automatically forgive loans for eligible borrowers based upon a data match with the Social Security Administration (SSA). This helped hundreds of thousands of borrowers who were eligible for relief but hadn’t managed to navigate paperwork requirements. The Department also made it easier for borrowers to qualify for relief based upon SSA determinations, made it easier to complete the TPD application, and eliminated provisions that had caused many borrowers to have their loans reinstated. 

Delivered long-awaited help to borrowers ripped off by their institutions, whose schools closed, or through related court settlements. The Administration has approved just under 2 million borrowers for $34.5 billion in loan relief.  

For years, students had sought relief from the Department through borrower defense to repayment—a provision that allows borrowers to have their loans forgiven if their college engaged in misconduct related to the borrowers’ loans. The Department delivered long-awaited relief to borrowers who attended some of the most notoriously predatory institutions to ever participate in the federal financial aid programs. This included approving for discharge all remaining outstanding loans from Corinthian Colleges, as well as group discharges for ITT Technical Institute, the Art Institutes, Westwood College, Ashford University, and others. The Department also settled a long-running class action lawsuit stemming from allegations of inaction and the issuance of form denials, allowing it to begin the first sustained denials of non-meritorious claims. 

Today, the Department also approved 4,100 additional individual borrower defense applications for borrowers who attended DeVry University, based upon findings announced in February 2022.  

“For decades, the federal government promised to help people who couldn’t afford their student loans because they were in public service, had disabilities, were cheated by their college, or who had completed decades of payments. But it rarely kept those promises until now,” said U.S. Under Secretary of Education James Kvaal. “These permanent reforms have already helped more 5 million borrowers, and many more borrowers will continue to benefit.” 

The table below compares the progress made by the Biden-Harris Administration in these key discharge areas compared to other administrations. 

	Borrowers approved for forgiveness
	Prior Administrations	Biden-Harris Administration
Borrower Defense (Since 2015)	53,500	1,767,000*
Public Service Loan Forgiveness (Since 2017)	7,000	1,069,000
Income-Driven Repayment (all-time)	50	1,454,000
Total and Permanent Disability (Since 2017)	604,000	633,000

* Includes 107,000 borrowers and $1.25 billion captured by an extension of the closed-school lookback window at ITT Technical Institute.  

Additional actions related to closed school discharges 

The Department today also announced additional actions that will make more borrowers eligible for a closed school loan discharge. Generally, a borrower qualifies for a closed school discharge if they did not complete their program and were either still enrolled when the school closed or left without graduating within 120 days before it closed. . However, the Department has determined that several schools closed under exceptional circumstances that merit allowing borrowers who did complete and were enrolled in the school more than 120 days prior to the closure to qualify for a closed school discharge. justify extending the look-back window beyond the applicable 120 or 180 days--allowing additional borrowers to qualify for a closed school discharge. Generally, eligible borrowers will have to apply for these discharges, but the Secretary has directed Federal Student Aid to make borrowers aware of their eligibility, and to pursue automatic discharges for those affected by closures that took place between 2013 and 2020 and who did not enroll elsewhere within three years of their school closing. 

These adjusted look-back windows are: 

• To May 6, 2015, for all campuses owned at the time by the Career Education Corporation (CEC), which have since closed. That is the day CEC announced it would close or sell all campuses except for two brands. This affected the Art Institutes, Le Cordon Bleu, Brooks Institute, Missouri College, Briarcliffe College, and Sanford-Brown. 
• To December 16, 2016, for campuses owned by the Education Corporation of America (ECA) on that date that closed. ECA operated Virginia College, Brightwood College, EcoTech, and Golf Academies and started on the path to closure after its accreditation agency lost federal recognition and ECA could not obtain accreditation elsewhere. 
• To October 17, 2017 for all campuses owned or sold on that date by the Education Management Corporation (EDMC) and that later closed. That is the day EDMC sold substantially all of its assets to Dream Center Educational Holdings. The decision affects borrowers who attended the Art Institutes, including the Miami International University of Art & Design and Argosy University.  
• To April 23, 2021, for Bay State College. That is the day this Massachusetts-based college began to face significant accreditation challenges, which eventually led to the school losing accreditation and closing in August 2023. 

Borrowers who want more information about closed school discharge, including how to apply, can visit StudentAid.gov/closedschool. 

A state-by-state breakdown of various forms of student debt relief approved by the Biden-Harris Administration is available here.