Biden Admin Forgiving Debt for Art Institutes Students

Biden Admin Forgiving Debt for Art Institutes Students

( – The Biden administration has revealed it is forgiving another $6.1 billion in student loan debt. Announced on May 1, this most recent relief package specifically targets 317,000 people who allegedly fell victim to the fraudulent practices of a now-defunct chain of for-profit colleges known as The Art Institutes (AI) between 2004 and 2017.

According to the Education Department, AI intentionally and purposefully deceived students by falsifying job data and inflating salary projections to convince them to take on more debt. While a considerable portion of that money went toward tuition, the school, more often than not, failed to deliver any substantial professional results.

In a statement, President Joe Biden declared that AI “knowingly misled students” and, in many cases, left them entirely without prospects after graduation. Noting his earlier promise to take on the issue of colleges defrauding students and borrowers, he drew firm parallels between that ongoing effort and this most recent debt relief package.

“Today’s announcement builds on all we’ve done to fix broken student loan programs,” Biden explained, “and bring higher education more in reach.”

In 2015, the Department of Justice, at least 40 state Attorneys General, and four whistleblowers launched a suite of civil suits against EDMC under the False Claims Act. All accused the company of using deceptive practices and high-pressure sales to recruit students.

EDMC settled all of these cases for $95.5 million in November of the same year. They also agreed to significant recruiting practice reforms aimed at preventing them from defrauding students in the future, either purposefully or unintentionally.

Whether the changes worked remains unclear, even now. The AI network of colleges continued to struggle as the years passed, and over time, more and more of the schools closed down. In September of 2023, AI abruptly shuttered services at the last of its remaining campuses across the US, leaving around 1,700 students abandoned.

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