$37 Mln Student Debt Relief For 1200 Defrauded University Of Phoenix Borrowers
The Biden Administration has approved $37 million in debt cancellation for more than 1,200 student borrowers who were deceived by the University of Phoenix.
These borrowers were cheated into believing that by attending the University of Phoenix they would have promising career prospects at Fortune 500 companies – yet those benefits and opportunities never existed.
The U.S. Department of Education announced that it will forgive nearly $37 million in federal loans for the students who enrolled at the University of Phoenix between September 21, 2012, and December 31, 2014, and applied for relief.
The relief stems partly from evidence provided by the Federal Trade Commission, which obtained a $191 million settlement from the University in 2019.
The Department of Education said it found that a national ad campaign from Phoenix misled prospective students by falsely representing that its partnerships with thousands of corporations, including Fortune 500 companies, would benefit students by, for example, giving them hiring preferences at those companies. In fact, Phoenix’s corporate partnerships provided no such benefits to students.
According to the 2019 FTC complaint, University of Phoenix, and its parent company, Apollo Education Group, Inc., falsely claimed that their relationships with top companies created job opportunities specifically for University of Phoenix students and that they worked with these companies to develop their curriculum. The FTC charged that the companies used a multimedia ad campaign to attract students, including ads specifically targeted to military and Latino consumers. The companies’ “Let’s Get to Work” campaign featured several high-profile employers, including Microsoft, Twitter, Adobe, and Yahoo!, giving the false impression that University of Phoenix worked with those companies to create job opportunities for its students.
With this, the total amount of debt cancellation approved by the Biden Administration rises to more than $117 billion, including $14.8 billion in relief for 1.1 million students whose colleges took advantage of them or closed abruptly.
President Joe Biden said his Administration won’t stand for colleges taking advantage of hardworking students and borrowers. “As long as I am President, we will never stop fighting to deliver relief to borrowers who are entitled to it – like those who attended University of Phoenix – and we will hold colleges accountable for misleading and cheating their students”.
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