Washington, D.C. – Today, Senator Elizabeth Warren (D-MA) sent a letter to Secretary of Education John King, requesting that his Department of Education halt loan collections and grant debt discharges to defrauded former Corinthian Colleges students. Maggie Thompson, Executive Director of Generation Progress, issued the following statement in response:
“We applaud and stand with Senator Warren for defending the tens of thousands of defrauded borrowers – many of whom are eligible for fast track debt relief – still being targeted by the Department’s loan collection. It is stunning that the Department of Education’s student loan bank has 80,000 former Corinthian students in collections; that is the equivalent of the Department putting the student populations of Auburn University, the University of Iowa, and the University of Virginia combined into collections.
Student loan default is financially devastating. As a consequence of default, these Corinthian victims face credit penalties, tax refund wage garnishment, and Social Security reductions from the Department, all to pay off fraudulent debts owed to a fraudulent for-profit college.
We know that less than one-third of Corinthian borrowers applied to the Department’s borrower defense discharge program, with only a fraction getting approved. This tells us that not only is the Department continuing to collect invalid debts from Corinthian borrowers, it is also failing to inform them of their right to a loan discharge. The Department has already proved capable of identifying and preventing future fraud, as seen in the recent closure of ITT Tech, but in addressing today’s issues, we mustn’t forget yesterday’s victims.”
For more information or to speak with an expert, contact Kyle Epstein at firstname.lastname@example.org or 202.481.8137