The government is settling a case that will award billions in debt relief to students, many of them veterans, who say unscrupulous colleges tricked them into paying too much for useless degrees.


The Department of Education is settling a case that will award nearly $6 billion in student debt relief. They allege that unscrupulous, mostly for-profit colleges tricked them into overcharging for often unnecessary degrees. Many of these students were veterans defrauded of their GI Bill educational benefits. And now they are celebrating that decision. NPR’s Quil Lawrence reports.

QUIL LAWRENCE, BYLINE: Jarrod Thoma served in the U.S. military and then planned to become an engineer when he got out. But he says DeVry University, a for-profit school, gutted his GI Bill benefits and encouraged him to take out tens of thousands more loans. Then he graduated in 2015.

JARROD THOMA: Well, what’s the degree worth? It’s not even worth the paper it’s printed on. I had a lot of trouble finding a job.

LAWRENCE: Trump administration Education Secretary Betsy DeVos repealed rules that required schools to prove their degrees led to gainful employment. And his department fought that class action lawsuit, which the Biden administration has now settled in U.S. District Court. Carrie Wofford is with Veterans Education Success.

CARRIE WOFFORD: This is a huge deal for many students who have been cheated, cheated and deceived by really lousy, mostly for-profit colleges. This is not a cancellation of student debt for just any student. It’s only if you’ve been cheated.

LAWRENCE: Also, schools have a limit on the amount of federal money they can accept. But for years there was a loophole. Money from the GI Bill did not count towards this quota. That made veterans a very profitable target, Wofford says.

WOFFORD: These veterans like Jarrod Thoma, who were just totally targeted for their GI Bill and targeted in a really ugly way.

LAWRENCE: Now Thoma and his family are about $50,000 less. He has been carrying this debt for seven years.

THOMA: I was at a loss for words. I was shocked, in disbelief, truly ecstatic. I told my wife the first thing. I am always at a loss for words. I can’t believe it’s finally at some sort of resolution, and I feel vindicated.

LAWRENCE: The Department of Education said it will send billions of dollars in automatic relief to about 200,000 borrowers under the class action lawsuit. Quil Lawrence, NPR News.

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