A federal judge scrapped a settlement Tuesday over the Trump administration’s slow processing of loan forgiveness for borrowers who have accused their colleges of fraud, ruling that Education Secretary Betsy DeVos undermined the deal.
U.S. District Judge William Alsup said in a sharply worded decision that DeVos undercut the settlement by denying large swaths of the claims without sufficient explanation.
The class-action settlement, which was reached earlier this year and received preliminary approval from the court, was meant to force the Education Department to move faster on final decisions for roughly 160,000 of the backlogged requests for loan forgiveness, known as “borrower defense” claims. Some of the claims have languished at the department for years.
Alsup said he is alarmed that DeVos has in recent months responded by swiftly rejecting tens of thousands of the applications through “perfunctory” denial notices. Of the applications in question in the class-action lawsuit, DeVos has denied 74,000 applications and granted 4,400 applications, which the judge noted was a denial rate of 94 percent.
Ruling justification: Alsup called the denial notices “potentially unlawful” and said he was considering blocking DeVos from issuing any further denial notices as the lawsuit proceeds.
The judge, who President Bill Clinton appointed for the Northern District of CONTINUE READING: Judge blasts DeVos’ sweeping denials of student loan relief claims as ‘disturbingly Kafkaesque’ - POLITICO