Earlier this month, Kim ordered a lawsuit to go “full-steam ahead” after the DeVos-led Education Dept. was found guilty of violating an Obama-era court order requiring the now-defunct Corinthian College to stop collecting loan payments from 16,000 former students.
The Edu. Dept.’s $100,000 fine is expected to be put toward compensating the exploited loan borrowers.
Kim stated in her eight-page ruling:
“[There is] no question that defendants’ violations harmed individual borrowers who were forced to repay loans either through voluntary actions or involuntary methods (offset from tax refunds and wage garnishment) and who suffered from the adverse credit reporting.”
“Defendants have not provided evidence that they were unable to comply with the preliminary injunction, and the evidence shows only minimal efforts to comply with the preliminary injunction. The court therefore finds defendants in civil contempt.”
If the Dept. continues violating the order, Kim concluded she “will impose additional sanctions.”
Praising Kim’s ruling, Director of Harvard Law School’s Project on Predatory Student Lending, Toby Merrill, representing the former Corinthian students, said:
“It’s a rare and powerful action by the court to hold the secretary in contempt, and it reflects the extreme harm that Betsy DeVos and the Department of Education have caused students who were already defrauded by a for-profit college.”
The Obama administration put in place policies requiring the U.S. Education Department to investigate loan servicing companies’ past conduct before the government awarded lucrative contracts. Those contracts were required to include certain consumer protections, such as prohibiting loan servicing companies from cheating federal student loan borrowers and guiding borrowers through the repayment process.
Once DeVos assumed Education Dept. control after Donald Trump took office, however, she ignored the approximately 160,000 loan forgiveness applications until 80,000 individuals won a class action lawsuit compelling her to stop collecting on their loans.
Garnishing former students’ tax refunds and wages despite the court order, DeVos continued collecting on loans, benefiting 102 companies posing potential conflicts of interest, exposing her investments in the very companies from which Obama’s student lending policies were meant to protect.
Harvard Law School’s Project on Predatory Student Lending director of litigation, Eileen Connor, states she had borrowers with four-year-old claims.
She argues loan debt has ballooned, and in lawsuits, her group described delays causing borrowers anxiety, fear, psychological and financial distress.
Interestingly, the damage DeVos has inflicted on public education the past three years may help bring down the Trump administration.
In addition to ignoring student loan protections to help her family’s vested business interests, Betsy DeVos also reversed Obama’s directive requiring schools to allow transgender students to use restrooms that conform to their gender identities.
She also scrapped Obama-era guidelines on investigating college and university campus sexual assault, discarded 72 policy documents outlining disabled students’ rights codified under the Individuals with Disabilities Education Act and the Rehabilitation Act (IDEA), and rescinded students’ civil rights protections.
Last year, DeVos expressed interest in directing Student Support and Academic Enrichment grant money to arm teachers.
This is what happens when we put a charter school millionaire in charge of our public education system.
So should Democrats appropriate the “Lock her up!” chant.
In this case, it’s warranted.
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