Rule aims to ease debt relief to students who were defrauded
WASHINGTON - The Obama administration is trying to make it easier for students who have been misled or defrauded by their colleges to have their loans forgiven.
The Education Department has proposed a new rule that lays out a clear relief process for borrowers who believe they were lied to about job prospects after college or otherwise deceived in order to enroll in the school.
The proposal also aims to hold schools accused of fraud or at financial risk more accountable by requiring them to notify prospective and enrolled students, as well as set aside money to help cover future claims against the school.
The proposal follows the collapse last year of Corinthian Colleges, one of the largest for-profit college companies, leaving students with meaningless degrees and mountains of debt.