California sues Dept. of Education over student debt relief claims

By Ray Downs  |  Dec. 14, 2017 at 8:40 PM
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Dec. 14 (UPI) -- The state of California filed a lawsuit against the U.S. Department of Education Thursday, saying it failed to process thousands of debt-relief claims from students who took out federal loans to pay for Corinthian Colleges, a now-defunct, for-profit school.

California Attorney General Xavier Becerra accused Education Secretary Betsy DeVos of violating the Administrative Procedures Act by delaying the claims. Since President Donald Trump took office in January, an Inspector General report found that 26,000 claims have been submitted and two have been processed. Those two were denied relief.

"The department's ongoing delay in approving the pending claims of defrauded Corinthian students is unlawful under the APA," the lawsuit says. "This delay -- 11 months and counting -- is unreasonable and illegal because the department has already determined that these students qualify for specific, expedited relief. The department has no justification for its delay -- a delay that unquestionably harms students."

The lawsuit also accused the Department of Education of using "draconian debt-collection tactics" against students who are awaiting an answer on their debt-relief claims.

"The department has seized these students' tax refunds and garnished their wages in violation of the APA," the lawsuit says.

DeVos paused the debt relief program for victims of for-profit colleges earlier this year pending further review, but has not announced whether it will be continued.

"What Secretary DeVos is doing is unconscionable," Becerra said in a statement. "After having their American dreams stolen by a so-called higher education institution, Corinthian students are now being denied critical relief by a secretary of Education hostile to their plight. It is hard to believe that we are forced to sue the Department of Education to compel Secretary DeVos to carry out the department's legal duty and help these students rebuild their lives."

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