Betsy DeVos Held in Contempt. Department of Education fined $100,000. What’s Going On?
Last week should have been a bad week for Education Secretary, Betsy DeVos, but one wonders if it is possible to create a really meaningful punishment for somebody like Betsy DeVos—a punishment for allowing her staff to neglect their responsibility to protect vulnerable student loan borrowers who were defrauded by Corinthian Colleges.
Although last week it was announced that Betsy DeVos was being fined $100,000 for the Corinthian Colleges loan forgiveness disaster, it turns out that the agency—the Department of Education—is really being fined. And even if DeVos had been personally fined, she is among the wealthiest members of President Trump’s cabinet, and the fine wouldn’t have made much of a difference given the size of her family’s fortune.
But the students who were defrauded are not so lucky. DeVos is responsible for causing what has to be financial misery for at least 16,000 students and parents who were billed for loan payments which had supposedly been cancelled. These people were hounded by loan collectors, and some of them had their tax refunds and wages seized by the contractors who handle loan collections for the Department of Education.
For the NY Times, Erica Green and Stacy Cowley report: “Magistrate Judge Sallie Kim of the Federal District Court in San Francisco ordered the Education Department to pay a $100,000 fine. The money will go toward various remedies for students who are owed debt relief after President Barack Obama’s Education Department found they were defrauded by the chain, Corinthian Colleges, which collapsed in 2014. The ruling is a victory for the more than 60,000 students who have been on a financial roller coaster since Corinthian imploded, after state and federal officials found that it lured students through deceptive recruitment practices and falsified job placement rates.”
Green and Cowley further explain the legal history of the case. DeVos has tried to implement a system by which ‘borrowers defense to repayment’ claims would be paid only in cases when borrowers were found to be without a living wage: “Last year, Magistrate Judge Kim found the system illegal, ruling that the Education Department had violated borrowers’ privacy by CONTINUE READING: Betsy DeVos Held in Contempt. Department of Education fined $100,000. What’s Going On? | janresseger