Defrauded students still waiting for Biden to help them
Amanda Kulka expected her six-year struggle to cancel student loans to be over.
Powerful allies, including a state attorney general and a federal judge, agreed that she and other Massachusetts students were conned by the defunct for-profit chain Corinthian Colleges. Courts even granted all 7,200 of them full debt relief in June, berating former Education Secretary Betsy DeVos’ attempt to block their request for redress.
The Trump administration has appealed the decision, bringing the order to a standstill. But with the arrival of a new administration, which has a keen interest in consumer rights, Kulka believed the matter would be over soon. She was wrong.
“When Biden was elected, I was like, ‘Yeah, here’s someone who’s heard of our fight, who’s heard of our struggles. He’ll take care of that, ”said Kulka, 33, who owes $ 10,000 in federal student loans for a certificate in medical administration. “But we’re still here. I want to be optimistic, but I’ve been waiting so long.”
The Biden administration continues to defend lawsuits against the Education Department over Trump-era policies on student loans and the regulation of skills training.
Biden’s education secretary, Miguel Cardona, began to dismantle the policies of his predecessor. The department this week lifted the college ban on providing emergency grants to undocumented and international students. It also extended student debt relief to disabled borrowers and some defrauded students.
But advocacy groups are baffled as Justice Department attorneys representing the federal agency are holding the line on legal positions that don’t fit Biden’s agenda.
Justice has overturned the government’s position in several high-profile cases involving the Patient Protection and Affordable Care Act, the franchise and sentencing since Biden took office. Federal lawyers even dropped a Trump-era lawsuit accusing Yale University of discriminating against Asian and white candidates.
Yet when it comes to cases involving federal student aid, consumer lawyers say the Biden administration is moving at an icy pace.
“I am shocked that over 100 days later, we are still on an active appeal on something that is so opposed to what the Biden administration claims it is,” said Toby Merrill, director of the project on predatory student loans, a group representing borrowers in several Trump-era cases, including the class action lawsuit in which Kulka is involved.
She added, “We won the case, so all they have to do is follow the law. It’s incredibly frustrating for our clients who have waited so long for someone to do the right thing. “
Department of Education spokesperson Kelly Leon said “the agency’s new leadership is actively working to address concerns about the student financial aid policies of the previous administration.” With the pending lawsuits filed during Trump’s tenure, she said the department “continues to assess the issues … to determine if they can be resolved without further litigation.”
Advocates wonder how long it takes for the new leadership to continue for people like Kulka to live their lives.
Enrollment in the Everest Institute, one of three schools run by Corinthian, was supposed to create a career path for Kulka. She had hoped to go to college, but her son took priority after getting pregnant at 18. Hair braiding jobs and retail were a dead end.
TV commercials for Everest, promising a short road to lucrative jobs, piqued his interest. And campus recruiters who promised to find him a job in the field convinced Kulka. But after barely using the assigned course material, she began to question the quality of the education.
“We opened maybe three books out of the 12 that had been awarded,” Kulka said. “I felt like I was on my own and had to teach myself. They were supposed to prepare us for a licensing exam and didn’t.”
After Kulka graduated in 2010, what she thought were practical career services from Everest came down to a few job posting emails from Craigslist. They were the same ads she had found on her own and none of them resulted in a job. Back to hair braiding. Back to retail. And now she was in debt.
“When I signed up for Everest it was all ‘We’re going to find your strengths and find the right job for you,’ said Kulka, who eventually found work at an insurance company through an insurance company. Acting Agency. “In reality, all we got was an explosion of emails for ads with incorrect information.”
Kulka wasn’t the only Everest student to sell a merchandise bill. An investigation by the Massachusetts attorney general’s office found that the school had distorted its curricula and placement rates since at least 2009.
The state’s senior attorney sued Corinthian in 2014 for allegedly using deceptive marketing to trick students into taking out loans they had no hope of repaying. Similar lawsuits have sprung up across the country, including one led by California Attorney General Kamala Harris.
The closure of Corinthian in 2015 ushered in a deluge of requests for debt relief from the Department of Education, including one made on behalf of Everest students by Massachusetts Attorney General Maura Healey. His group request contained more than 2,700 pages of supporting evidence, but languished in the ministry for years, like tens of thousands of other requests.
While the Obama administration has been slow to act on requests, the Trump administration has suspended processing of requests for months. Students are entitled to a discharge on their federal student loans if their colleges defraud them, but DeVos called the program, known as the borrower’s repayment defense, a gift of “free money.”
DeVos changed the methodology for calculating relief, dropped a 2016 update to the law, rewrote the rules to limit pardon, and issued general denials. All of these actions are at the heart of the ongoing legal proceedings.
Dropping some cases could be a matter of timing, as the administration prepares new rules on the policies underlying a few lawsuits.
In March, the Biden administration announced it would revise DeVos’ rewrite of the borrower defense rules, the source of lawsuits brought by state attorneys general. Biden also said during the election campaign that he would reinstate the paid employment regulation, which penalizes job training programs for producing too many graduates with more debt than they can repay.
Restoring these Obama-era policies would require negotiated regulations at the Education Department, a process that could take months or more. This could hinder movement in related cases.
But consumer groups argue that resolving some cases could easily override Trump-era policies, particularly the repeal of the paid employment rule. The American Federation of Teachers, which sued the department for overturning the rule, urged Cardona in April to stop defending the lawsuit.
A group of activists also voiced concerns to Cardona in April about the continued defense of paid litigation and other matters spawned by DeVos’ policies. The 24 organizations, led by Demand Progress, also criticized the Biden administration for supporting the former secretary’s fight to avoid testifying about his role in the slow march and denying numerous requests for debt relief.
Lawyers for the Department of Justice argued in a joint filing with personal counsel for DeVos that his testimony would be “extraordinary, unnecessary and unfounded.”
Campaigners called the motion “unacceptable” and urged the education ministry to “drop this effort to shield DeVos from liability.” The groups said the ministry “must stop doubling down on its efforts to defend the Trump administration’s positions in all cases involving student loan issues.”
The federal agency has asked the courts for more time to review and respond to several complaints, but it’s unclear whether that will lead to a speedy resolution.
“This may reflect the fact that an internal Department of Education process is underway to reassess the agency’s position,” said Christopher Peterson, professor of law at the University of Utah. “But the ministry needs to act quickly to resolve the issues facing the public and we are yet to see it in a number of critical cases.”
The Biden administration has addressed some of DeVos’ controversial debt relief policies. Cardona has scrapped a plan to give partial debt relief to defrauded borrowers whose claims have been approved and instead give them full discharge.
But the new policy is limited and does not apply to Kulka.
“Right now I’m in a place where there’s nothing I can do without this debt eating into me,” Kulka said. “It may seem small, but it’s been such a long time trying to get a loan is a horrible experience. I take two steps forward with this case and take ten steps back.”