MN Asks Department of Education to Forgive Federal Student Loans Over Fraud Finding

The Department of Education has made it tougher for federal student loan debtors to obtain forgiveness of their federal student loans under the Borrower Defense to Repayment program. One of the changes made has been to make it much harder for students to prove they are the subjects of fraud by the school.

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The State said, “The lawsuit further alleged that the schools also targeted, marketed, and recommended their criminal justice associate’s degree program to prospective students who told the schools they wanted to become Minnesota probation officers, even though all 87 counties in Minnesota require, at a minimum, probation officers to hold a bachelor’s degree.

The cost of the schools’ criminal justice program ranged from $39,150 to $78,300. As a result of the schools’ misrepresentations, many students were saddled with large amounts of student loan debt without the ability after graduation to obtain a job in their chosen career field of serving Minnesota’s citizens as police and probation officers.” – Source

In 2014 the State of Minnesota went after the Minnesota School of Business and Globe University, schools with common ownership, and claimed the schools had engaged in consumer fraud and deceptive trade practices by misrepresenting the job opportunities available to their criminal justice graduates. In 2016 the court found the schools had engaged in such behavior.

Students are still languishing with federal student loan debt even though the schools were found to have deceived students and are now closed.

The Minnesota Attorney General has requested Department of Education Secretary Betsy DeVos get off her stick and forgive all the debt under the closed school discharge.

“Federal law, however, clearly instructs that the Department relieve students from their unjustified debts and allows the Department to recoup the cost of discharging these loans from the schools that violated the law,” Swanson wrote.

The State is requesting the Department of Education to take a closer look at this situation and stop dilly-dallying and provide the relief allowed to students by the Department of Education.

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