Beshear, State Attorney Generals Call On U.S. Department Of Education To Uphold Student Protections

Attorney General Andy Beshear and 20 other state attorneys general have submitted public comments to Education Secretary Betsy DeVos, calling a move by the U.S. Department of Education to replace existing student protections a “waste of resources and a betrayal of students.”

The July 12 comments are in response to the department’s June 14 announcement of intentions to delay large portions of the Borrower Defense Rule, which was designed to hold abusive higher education institutions accountable for cheating students and taxpayers out of billions of dollars in federal loans.

According to the attorneys general, the Borrower Defense Rule was created in large part by state and federal investigations into for-profit schools like the now-defunct Corinthian Colleges, and was finalized after robust and thorough negotiated rulemaking with input from numerous stakeholders.

Beshear said the department announced it would withdraw the Rule without soliciting, receiving or responding to any comment from the public, and without engaging in the required process.

“It is my hope that the department will not cast aside all the hard work and progress achieved during its previous rulemakings and turn its back on the critical protections it promised to borrowers,” Beshear said. “Attorneys general and all the stakeholders must continue to pressure the department to protect students from abuse at the hands of predatory schools.”

Under the Borrower Defense Rule, a successful enforcement action against a school by a state attorney general entitles borrowers to obtain loan forgiveness, and enables the Department of Education to seek repayment of any amounts forgiven from the school.

The attorneys general also oppose the department’s efforts to replace the Gainful Employment Rule, which empowers students to make informed decisions about their education and protects students from programs that will leave them with burdensome debt and poor job prospects.

For-profit colleges AGs have investigated and taken enforcement actions against include: American Career Institute; Ashford University/Bridgepoint Education Inc.; Corinthian Colleges Inc.; Career Education Corporation; Education Management Corporation; Daymar College; DeVry University; ITT Tech; National College of Kentucky and Westwood Colleges.

Beshear’s office is committed to holding for-profit colleges accountable in Kentucky and is working to help defrauded students.

• In December 2016, Beshear announced nearly 3,500 former students of Daymar College’s Kentucky campuses and online programs will receive restitution checks totaling $1.2 million. The payments are pursuant to a settlement agreement the Office of the Attorney General entered into with Daymar in 2015 resolving a consumer protection lawsuit.
• In August 2016, Beshear announced that the Kentucky Court of Appeals had affirmed a previous order by Franklin Circuit Court requiring National College of Kentucky Inc. and its attorneys to pay the state a combined $157,000 in civil monetary sanctions. The Kentucky Supreme Court declined in April to take up National College’s request to overturn the appeals’ court decision.
• In March 2016, Beshear joined seven other state attorneys general in asking the U.S. Department of Veterans Affairs to restore educational and vocational benefits to thousands of veterans victimized by Corinthian Colleges Inc. for predatory practices. Kentucky veterans are among the 2,000 students who received letters from Beshear regarding their federal loans.

Beshear said students who have been a victim of a for-profit college may contact his office by phone, 502-696-5300, or by completing a complaint form.