It’s Time for the Government to Help Victims of College Fraud

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By Suzanne Martindale on Monday, September 28th, 2015

With another school year in full swing, students and families are embarking on the journey of higher education with hopes of better days and opportunities ahead.  But all too many students have been burned in recent years by schools making false promises that put them into debt for a low-quality education and weak job prospects.

This weekend, the New York Times joined a growing public chorus that is demanding immediate action. In an Editorial Board op-ed, the Times decried the federal government’s “decades-long failure” to curb bad practices at for-profit colleges and trade schools taking advantage of students and taxpayers.

By making deceptive claims, or even telling outright lies about the quality of their programs and their graduates’ job outcomes, some for-profit schools have siphoned off millions of federal financial aid dollars and put students into debt with impunity and weak government oversight.  Dropout rates are high at for-profit college schools, because many students don’t realize until after enrolling and attending courses that the schools can’t deliver as promised – so their only option is to withdraw and move on.  The problem is, they still have to repay the loans they took out to attend the programs, even without a degree or credential to show for their efforts.

After years of warnings from students and advocates, as well as lawsuits brought by state attorneys general and other federal agencies, the Department of Education is finally taking some steps to cancel loans that students were defrauded into taking.  We recently testified at public hearings held by the Department, urging them to use their full legal authority to cancel students’ debts automatically where there is evidence that schools broke the law.  However, the current process puts the burden on students to navigate the system and submit the right paperwork to the Department – even in cases where the agency already has the evidence it needs to conclude that the debts should be canceled.

We’ll be continuing our work in the coming months to push for a fair and simple process that brings justice to students and families.   They have a right to trust that schools operating with the blessing of the federal government are meeting basic standards of quality.  Anything less could undermine higher education in our society for decades to come.

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