About 1,200 students who attended the University of Phoenix are having their student loans canceled.
The Biden administration announced the deal Wednesday, saying that the $37 million in debt should be forgiven for students who attended the college between Sept. 21, 2012, and December 31, 2014, according to CNN.
The loans forgiven came to former students who sought to have their loans canceled under the borrower defense to repayment program, which allows former students to seek relief if they believe the college they attended either defrauded them or misled them.
The Department of Education is using a Federal Trade Commission investigation into the school as the foundation for loan forgiveness.
FTC action leads @usedgov to forgive nearly $37 million in loans for students deceived by University of Phoenix: https://t.co/Qh7WQBqU2L /1
— FTC (@FTC) September 20, 2023
The FTC was investigating the extent to which the University of Phoenix exaggerated claims that alleged partnerships with top corporations would lead to preference in employment.
In a 2019 settlement, the for-profit college admitted no wrongdoing.
“The University of Phoenix brazenly deceived prospective students with false ads to get them to enroll,” Federal Student Aid chief operating officer Richard Cordray said in a statement.
“Students who trusted the school and wanted to better their lives through education ended up with mounds of debt and useless degrees,” he said.
The University of Phoenix countered that with its own statement.
“We respectfully, but adamantly disagree with the U.S. Department of Education’s allegations related to the Dec. 2019 University of Phoenix settlement with the Federal Trade Commission,” the statement said.
“While the University is not against relief for borrowers who have valid claims, we intend to vigorously challenge each frivolous allegation and suspicious claim through every available legal avenue,” it said.
Eligible former University of Phoenix students covered in the loan forgiveness will get official notices next month.
October is also when student loan repayments, paused since the pandemic, return. The Biden administration had tried to create a wide-ranging debt elimination program, but that was rejected by the U.S. Supreme Court.
The borrowing rates at the college are among the nation’s highest, according to CNBC. In the 2022-23 academic year students took out almost $484 million in loans, according to higher education expert Mark Kantrowitz.
In August, the Department of Education wiped away $72 million for more than 2,300 borrowers who attended the for-profit Ashford University in California, according to CNN.
In July, the Education Department canceled $130 million in loans for 7,400 students.
That action covered Colorado students who attended CollegeAmerica between 2006 and July 1, 2020. The college shut down in 2021 after a state lawsuit against it, according to ABC.
This article appeared originally on The Western Journal.
