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The U.S. Department of Education is sorting through nearly 20,000 loan-forgiveness requests from students asserting that their for-profit colleges misled them when they took on heavy debt burdens to pay for expensive programs.

The Wall Street Journal recently reported that the Department of Education is processing 19,657 so-called "borrower's defense requests" in which former students have an opportunity to demonstrate that they were misled at the time of enrollment with promises relating to programs and job placement. 

To date, the government has allowed around 3,400 borrowers to cancel $27 million in student loan debt, with the vast majority relating to former students of Corinthian Colleges, Inc., the for-profit giant that ran Everest, WyoTech and Heald College before it collapsed as a result of intense federal scrutiny.
 
 
Inside Higher Ed reports that the remnants of Corinthian Colleges purchased last year by Zenith Education Group have shrunken further due to additional consolidation.

According to the news organization, Zenith is consolidating eight of the campuses of the Everest and WyoTech campuses that it purchased last year from Corinthian Colleges and is gradually closing two campuses in Florida. 

More than Z00 Zenith employees are losing their jobs and more than 100 positions at Everest Online and student financial support are being eliminated, according to Inside Higher Ed.

After this round of consolidation, Zenith will have 24 Everest campuses and three WyoTech campuses, the news organization reported.

Earlier in March, the Associated Press reported that many problems at Everest and WyoTech were persisting for students after Zenith's purchase in 2015 of parts of the now-defunct Corinthian Colleges chain. Zenith disputes the A.P. story.

 
 
California consumer protection officials have ordered the once-venerable Corinthian Colleges to stop enrolling new students at its remaining 13 Wyotech and Everest College campuses in the state due to growing concerns about the schools' viability.

According to a report in the Orange County Register, officials with the state's Bureau of Private Postsecondary Education cited concerns over the schools' financial resources, mounting legal pressures and inadequate regulatory disclosures in issuing the order to stop new enrollments to Corinthian, which does not require the for-profit company to cease operations.

California bureau chief Joanne Wenzel said in a statement that the order was necessary to “protect individuals who may have been thinking about enrolling at these schools.” 

The Register report added:  "Corinthian has been seeking to sell its California campuses since June under an agreement with the U.S. Department of Education and has previously argued that continuing to enroll students was necessary to maintain their financial viability and prevent school closures.The agreement with the U.S. Department of Education followed years of increasing scrutiny by state and federal regulators over the accuracy of Corinthian’s job placement statistics and loan practices, and marked the beginning of the company’s slow unraveling.  Corinthian officials maintain that regulators have unfairly targeted them for isolated incidents of employee misconduct and their business model performs a valuable role in educating students who are under-served by more traditional institutions."
 
 
The Santa Cruz Sentinel profiles one of the Corinthian 100 participating in a debt strike:  a 22-year-old server at a pizza restaurant who incurred $30,000 in debt during an eight-month medical assisting program at Everest College that she was unable to complete.
Makenzie Vasquez told the newspaper that she was refusing to pay back her loans for a program that oversold and under delivered.  
“They sold me a dream for a nightmare,” said Vasquez. “I shouldn’t be 22 and be in this much debt and have nothing to show for it.”
 
 
The attorneys general from nine key states are calling upon the federal government to forgive federal loans issued to thousands of students at Corinthian Colleges, which imploded last year after years of criticism of sharp practices in enrolling adults in expensive programs with few job prospects after graduation.
In a letter to Secretary of Education Arne Duncan, these top Democratic prosecutors last week urged the U.S. Department of Education "to immediately relieve borrowers of the obligation to repay federal student loans that were incurred as a result of violations of state law by Corinthian Colleges, Inc."
The attorneys general were from Massachusetts, California, Connecticut, Illinois, Kentucky, New Mexico, New York, Oregon and Washington.
The call for debt relief comes at a time when a group of 100 former students of Corinthian are refusing to pay their loans used to pay for programs that they say were worthless.
In 2014, Corinthian announced that it would be closing and selling off its schools such as Everest and Wyotech  after U.S. Department of Education officials froze access to federal financial aid for three weeks at a time when the company was facing multiple challenges, including a lawsuit by the Consumer Financial Protection Bureau.

 
 
Patricia Ann Bowers has a story to tell about $57,000 in debt owed to the federal government for student loans paid to a for-profit school from which she was unable to earn a bachelor's degree.

Ms. Bowers is one of the "Corinthian 15," a group of 15 working adults who now find themselves deep in debt to the government after disillusioning experiences with schools run by Corinthian Colleges, a for-profit education company that has folded in recent months following intense government scrutiny of their enrollment practices and placement success.  

According to Ms. Bowers, Everest College -- one of Corinthian's subsidiaries -- assured her during repeated recruitment calls that they could accommodate her physical limitations due to accidents and help realize her dream of earning a bachelor's degree in marketing.  

But when she suffered a tragic loss of a son and sought to take some time off, the school refused to give her a leave of absence, telling her that she needed to remain enrolled even if she was unable to attend classes or do well in them.  She incurred so much loan debt in the course of three years of pursuit of a bachelor's degree that she has become ineligible for any additional federal student aid now -- even though she is still short of the credits needed for a bachelor's.

Now Ms. Bowers is refusing to pay the money back -- part of an organized "debt strike" among 15 former Corinthian students aimed at convincing thousands of others to do the same in an effort to bring attention to a national epidemic of student loan debt incurred by adults who are recruited by for-profit schools to pursue programs that they are unable to complete or to leverage into jobs in their chosen field.

Ms. Bowers' story -- and those of others in the Corinthian 15 -- are featured in a lengthy article published by ThinkProgress.org.  

Another member of the Corinthian 15 is Mallory Heiny, a woman from western Michigan who attended Everest Institute in Grand Rapids, incurring nearly $30,000 in student loan debt of a license practical nurse diploma that she was unable to attain before the program shut down.  Ms Heiny told Fox 17 that she was informed that she was ineligible for a discharge of her loan because she had been in the program too long.

The Washington Post also covers the Corinthian 15, along with the Huffington Post with this item.  As does Newsweek with a story and this graphic: