Biden Administration Cancels $5.8 Billion in Debt for Former Corinthian Students

The Department of Education announced that it will cancel $5.8 billion in student loan debt for 560,000 borrowers who attended any schools in the now-defunct for-profit network known as Corinthian Colleges, CNN reported. This amounts to the largest one-time discharge ever ordered. 

At its peak in 2010, Corinthian Colleges enrolled more than 110,000 students across 105 campuses. In 2013, then California attorney general Kamala Harris sued Corinthian for engaging in deceptive and false advertising and recruitment, according to CNN.

The lawsuit triggered other federal and state investigations while, concurrently, students at Corinthian campuses organized the nation’s first student debt strike, refusing to make their student loan payments. The investigations and public outcry resulted in Corinthian selling most of its campuses in 2014 and closing the remaining ones in 2015.

In its ruling, the Department of Education found that Corinthian Colleges misled prospective students about the ability to transfer credits and falsified its advertised job placement rate.

While most of Corinthian’s former students were already eligible for debt cancellation, the new action ensures that all borrowers who attended any of Corinthian’s campuses from its founding in 1995 through its closure will get debt relief, according to CNN.

- A. Thomas