Today, the Center for Responsible Lending (CRL) welcomed the Consumer Financial Protection Bureau's action against Bridgepoint Education, Inc., a for-profit college chain based in San Diego, Calif., for deliberately misleading students into taking out private education loans that cost more than advertised. Under the action, CFPB is ordering Bridgepoint to discharge any and all outstanding private loans made to its students and refund loan payments already made by borrowers. The total loan forgiveness and refund is estimated to be more than $23.5 million, and Bridgepoint is required to pay an $8 million penalty to CFPB. Bridgepoint operates Ashford University and University of the Rockies.
CRL's Whitney Barkley, a policy counsel specializing in student loans, made the following statement:
CFPB's action against Bridgepoint is welcome news. Deliberately misleading students through deceptive marketing into taking out greater loans than advertised is education fraud. This practice burdens borrowers with insurmountable debt, and it undermines opportunity for students to get ahead. With student loan debt toppling $1 trillion in recent years, it’s important to ensure regulations are in place and enforced so that the public can maintain trust in higher learning institutions and the quality education the provide.