Biden Cancels $6.1 Billion in Debt for Former Art Institute Students

The Biden administration on Wednesday canceled more than $6 billion in student debt for 317,000 people who attended Technical institutesa network of now-defunct for-profit colleges that President Biden said “intentionally misled students.”

After reviewing lawsuits brought by state attorneys general against the schools and their parent company, Education Management Corporation, the Education Department found that the technical institutes falsified employment numbers in advertisements and misled prospective students with inflated salary expectations.

In one case highlighted by the department, the Florida Art Institute campus appears to have included tennis star Serena Williams’ annual income in its graduate salary projections after she enrolled in classes there.

“This institution falsified data, intentionally misled students and tricked borrowers into taking on mountains of debt without leading to promising career prospects at the end of their studies,” President Biden said in a statement.

He also criticized former President Donald J. Trump, whom he accused of ignoring the influence of predatory, for-profit schools on students seeking what they believe are meaningful academic credentials.

“While my predecessor looked the other way when colleges defrauded students and borrowers, I promised to take on this head on to get borrowers the help they need and deserve,” Biden said.

The president’s decision to cancel student debt was another step in his quest for student loan forgiveness the following year Overturned by the Supreme Court A more ambitious plan to cancel more than $400 billion in debt.

Mr. Biden said last month that he would do so Another attempt at widespread debt relief For more than 25 million people, despite opposition from Republicans, who say it would be unfair to borrowers struggling to pay off their student debt without help.

Meanwhile, the administration has forgiven about $160 billion in debt owed by 4.6 million borrowers by reforming and streamlining existing programs that have been plagued by bureaucracy and other problems for years.

The measure covers students who attended Art Institute schools between Jan. 1, 2004, and Oct. 16, 2017. Borrowers will be notified starting Wednesday that they have been approved and will see their debt automatically canceled, the department said.

Federal student loan forgiveness for borrowers the administration determined were preyed upon by their schools emerged as part of the administration’s student debt relief strategy, using its authority under an existing program known as borrower defense to repayment. So far, the administration has approved $28.7 billion in debt forgiveness for about 1.6 million borrowers whose institutions engaged in deceptive practices or closed their doors.

“In addition to providing critical relief to students, we need to hold wrongdoers accountable — otherwise executives will continue to exploit students for their own benefit,” said Aaron Ament, president of the National Student Legal Defense Network, which represented the prior art. Institute students since 2018.

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