U.S. to Help Remove Debt Burden for Students Defrauded by For-Profit Chain

Nearly 25 years after a nationwide chain of beauty and secretarial schools was closed for defrauding students, the Department of Education has agreed to help victims wipe clean their burdensome federal student loan debts.

News Story (New York)

Patricia Cohen, Emily S. Rueb
New York Times (NYT)
August 9, 2017

Tags: For-profit college, Student Debt

Organizations mentioned/involved: New York Legal Assistance Group (NYLAG)


More than 36,000 students — mostly low-income, immigrant women — who attended schools run by Wilfred American Educational Corporation could potentially be affected by the settlement, which was approved by a federal court judge on Tuesday.

“The department has been collecting on these loans for decades, including by garnishing wages and intercepting income tax refunds,” said Jane Greengold Stevens, the director of litigation at New York Legal Assistance Group, a nonprofit representing the former students. “Finally, by entering this settlement, the department is providing the students an opportunity to get out from under the burden of these loans.”