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Ed Dept. Issues Final Rules for Defrauded Students; Activists Say the Rules Fall Short

Friday, August 30, 2019
Eric Kelderman | The Chronicle of Higher Education
After some two years of deliberation, the U.S. Department of Education has released final rules meant to protect students from colleges that close or defraud them. The “borrower defense to repayment” rule allows students to have their federal student loans discharged in cases where they were given false or misleading information, for example. The closed school discharge gives some students the option of having their loans forgiven if a college closes suddenly. The new rules, which go into effect in July, will replace a 2016 regulation issued under former President Barack Obama, and will save the federal government an estimated $11 billion over 10 years. Until that date, the department will enforce the existing regulations. An estimated 180,000 claims for debt relief are now being reviewed by the department, mostly from students affected by the closures of major for-profit colleges such as Corinthian Colleges and ITT Technical Institute.