In a significant move by the Biden administration, more than 260,000 former students of the now-defunct for-profit Ashford University are set to have their student loans forgiven. This decision comes as part of the administration's ongoing efforts towards debt forgiveness.
Ashford University, once a major player in the for-profit college industry with over 100,000 students, faced legal scrutiny after a California court found that the institution had misled students on various aspects such as accreditation, costs, and graduation timelines.
The Education Department initiated the loan forgiveness process for Ashford students, starting with an initial group of 2,300 former students who applied for relief through the borrower defense program in 2023. The recent action expands this forgiveness to all former students who attended during the period of alleged misconduct, covering the timeframe from March 2009 through April 2020.
Furthermore, the department has taken a rare step by seeking to prevent Zovio's founder from holding executive positions in institutions that receive federal financial aid. This move is in response to the founder's involvement in the unlawful conduct at Ashford University.
While the Biden administration had initially aimed to recover funds from the University of Arizona, which acquired Ashford, to offset the loan cancellations, this effort seems to have stalled. The administration's actions in the realm of student loan forgiveness have faced opposition from Republicans in Congress, who argue that such measures burden taxpayers who did not attend college.
Despite these challenges, the Biden administration has provided loan relief to over 5 million borrowers through various programs, marking a significant milestone in addressing student debt. However, the administration's broader goal of widespread student loan forgiveness has faced legal hurdles, with the Supreme Court blocking previous plans.
Overall, the decision to erase student loan balances for former Ashford University students reflects the administration's commitment to addressing issues in the for-profit college sector and providing relief to affected borrowers.
