AG Shapiro Voices Support for Discharging Student Loans for Students Deceived by Corinthian Colleges

June 2, 2022 | Topic: Consumers

U.S. Department of Education Announced Discharge, PA Students to Receive $131M in Relief

HARRISBURG—Attorney General Josh Shapiro voiced his support for the planned debt relief for former students of Corinthian Colleges, following an announcement from the U.S. Department of Education of plans to discharge millions in federal student loans for those students. Former students of for-profit Corinthian Colleges, Inc. and their related entities, which includes Wyotech in Blairsville and Everest Institutes in Pittsburgh and Bensalem, will have their federal loans forgiven.

“In 2017, we fought Corinthian Colleges over misrepresenting their job placement stats and deceiving students into taking out loans with high default rates,” said AG Shapiro. “And we were able to secure students some relief for their private student loans. We pushed for a discharge of federal loans for these students under the previous administration and I’m glad the Department of Education has now recognized that all former students of Corinthian schools, including 11,519 Pennsylvanians, deserve to have their federal loans discharged. My office will continue to fight against institutions and lenders that use deceptive practices to trap students in insurmountable debt.”

Following intense scrutiny by numerous government agencies, including the Pennsylvania Office of Attorney General, Corinthian Colleges abruptly ceased operations in 2015. The Department of Education then found that from 2010 to 2014, Corinthian Colleges made widespread misrepresentations about their post-graduation employment rates.

In 2017, AG Shapiro announced a settlement with Aequitas Capital Management, a defunct investment firm that held the private student loan accounts related to Corinthian Colleges. The settlement agreement provided $6.7 million in debt relief for Pennsylvanians who attended Corinthian’s for-profit colleges, and was part of a broader settlement worth $192 million for students across the country.

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