Education Department announces federal loan discharge for ITT students

Aug. 16 (UPI) -- The Education Department said it will discharge all remaining federal student loans for borrowers who attended ITT Technical Institute from 2015 through September 2016.

The decision affects 208,000 borrowers who owed some $3.9billion in loans. Education Secretary Miguel Cardona said those borrowers were misled with "lies and false promises" about the ITT and their job promises.

The department reviewed internal records from ITT, along with interviewing borrowers, ITT managers and recruiters before making their decision.

"The evidence shows that for years, ITT's leaders intentionally misled students about the quality of their programs in order to profit off federal student loan programs, with no regard for the hardship this would cause," Cardona said in a statement.

"The Biden-Harris administration will continue to stand up for borrowers who've been cheated by their colleges, while working to strengthen oversight and enforcement to protect today's students from similar deception and abuse."

The department said the decision will include ITT borrowers who have not yet applied for the borrower defense to repayment discharge,allowing them to have the loan forgiven without any additional action on their part.

"ITT defrauded hundreds of thousands of students, as we identified when I was the director of the Consumer Financial Protection Bureau," said Federal Student Aid Chief Richard Cordray in a statement.

"By delivering the loan relief students deserve, we are giving them the opportunity to resume their educational journey without the unfair burden of student debt they are carrying from a dishonest institution."

The Education Department said it also formally notified DeVry University that it is required to pay millions of dollars for approved borrower defense applications. The department said DeVry will be able to appeal that decision with its Office of Hearings and Appeals.