Illinois attorney general urges former Corinthian students to apply for loan discharge
More than 5,800 former Corinthian College students in Illinois can expect a letter this week from state Attorney General Lisa Madigan with a simple message: Don't forget to apply to the U.S. Department of Education for cancellation of federal student loans.
Madigan's office sent out the mass mailing Wednesday to students who attended the California-based for-profit institution, which sold or closed most of its 107 campuses and liquidated its assets through Chapter 11 bankruptcy in 2015 while under investigation for allegedly deceptive practices.
Attorneys general from 43 other states and the District of Columbia are expected to follow suit in the coming weeks, reaching out to hundreds of thousands of eligible students who attended Corinthian schools, including the Everest, Heald and WyoTech brands.
"Students across the country were lured into enrolling in Corinthian schools by company representatives who made false and misleading statements about prospective career opportunities," Madigan said in a news release Wednesday. "Every one of the students misled by Corinthian deserves to have their federal loans canceled."
Students who attended Corinthian schools between 2010 and 2014 may be eligible to have their federal loans forgiven.
Corinthian's failure was the catalyst for the Obama administration to reform borrower defense regulations, which were finalized in November.
The Department of Education under the Trump administration has already signaled it may roll back a number of Obama-era rules aimed at cracking down on for-profit colleges. On Tuesday, Education Secretary Betsy DeVos withdrew two memos issued by the department last year aimed at reforming federal student loan servicing.
In her memo to the Federal Student Aid office, DeVos said the Obama efforts were marred by "a myriad of moving deadlines, changing requirements and a lack of consistent objectives."
Madigan criticized the move in a Tuesday news release, saying, "Revoking these critical reforms sends a message to student loan servicers that poor practices are rewarded over the borrower's best interest."
Madigan filed a lawsuit in January in Cook County Circuit Court alleging student loan servicer Navient failed to properly assist borrowers struggling with loans. Navient denies those allegations.