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Congresswoman Norma Torres

Representing the 35th District of California

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Rep. Norma Torres, Judy Chu call for improved debt forgiveness process for Corinthian Colleges students

May 21, 2015
In The News

Rep. Norma Torres, D-Ontario, Rep. Judy Chu, D-Pasadena, and 14 others members of Congress have sent a letter to Secretary of Education Arne Duncan, asking him to streamline the federal loan debt forgiveness process for the former students of Corinthian Colleges and its subsidiaries.

“The company’s deceptive practices and ultimate closure has jeopardized the financial and academic future of more than 16,000 students,” the May 21 letter begins, “and we strongly urge the Department of Education to expeditiously develop and implement rules for borrowers seeking a discharge of related federal student loan debt in order to provide immediate assistance to these displaced students.”

The Santa Ana-based Corinthian Schools Inc. shut its doors in April. The company once operated more than 100 campuses across the United States and Canada, including Everest and WyoTech schools in California, Arizona and New York and Heald College campuses in California, Hawaii and Oregon.

The April 27 closure of the company’s last 28 campuses followed the U.S. Department of Education’s$30 million fine for misrepresentation. According to federal officials, Corinthian officials failed to respond to allegations that the school lied about its post-graduation job placement success and faked grades and attendance records. The company filed for bankruptcy on May 3.

Corinthian Schools Inc. came under fire two years ago when the U.S. Attorney General’s Office filed suit, alleging that the company targeted its advertising toward low-income residents with inflated claims of job-placement rates following graduation and training.

“As a result of Corinthian’s deceptive practices, thousands of students are now left with student loan debt and no degree,” the letter continues. “Meanwhile, past students who have already graduated now possess a degree from a discredited school. Corinthian’s students accepted federal student loans believing they were investing in their future and in an institution that would provide them with skills to make them competitive in the job market.”

The letter from the members of Congress calls on Duncan and the Department of Education to “produce a comprehensive set of guidelines for borrowers who have been victims of fraudulent practices to discharge their federal loans,” rather than assessing student situations on a case-by-case basis.

“We respectfully urge the department to use all available resources to ensure that the 16,000 individuals borrowing federal loans are not financially or academically harmed by the inability to complete their studies and to immediately develop and implement guidelines that will allow Corinthian students to discharge debt assumed as a result of Corinthian’s deceptive practices,” the letter concludes.