The Biden administration forgave $4.5 billion for more than 261,000 student loan borrowers in one of its final actions before departing office.
In a statement released by the Department of Education (DOE), the Biden administration said the forgiveness was distributed to 261,000 borrowers who attended Ashford University, a largely online school, from March 2009 to April 2020.
The recipients attended the formerly for-profit university, which the DOE determined had made “widespread misrepresentations” about students’ ability to obtain needed licensure, transferring credits, the cost and total of financial aid and the time it would take people to earn a degree.
The forgiveness stemmed from a successful lawsuit brought by DOE against Ashford University and its parent company, Zovio, Inc.
“Numerous federal and state investigations have documented the deceptive recruiting tactics frequently used by Ashford University,” U.S. Under Secretary of Education James Kvaal said in a statement. “In reality, 90 percent of Ashford students never graduated, and the few who did were often left with large debts and low incomes.”
The latest student loan forgiveness increases the total to $34 billion for borrowers whose schools took advantage of them, have since closed or are part of court settlements, the DOE said.
Ashford borrowers will be sent emails from the department in the coming days to notify them that their outstanding balances “will be discharged.” Borrowers will not need to take further action to receive the relief.
The Wednesday announcement comes just days after President Biden said his administration would forgive student loans for more than 150,000 borrowers.
The move brings the total number of people impacted by student loan forgiveness and relief during Biden’s term to over 5 million.
“Four years ago, President Biden made a promise to fix a broken student loan system. Today, life-changing student debt relief is possible for more than five million borrowers — more than any other administration in history,” Secretary of Education Miguel Cardona said.
