For-Profits Seek to Intervene in Federal Borrower-Defense Settlement
Meghan Brink
July 15, 2022
The motion could delay the discharges of $6 billion in student debt arranged by the recent settlement by the Department of Education in Sweet v. Cardona.
A major for-profit lobbying organization filed a motion Wednesday to intervene in a lawsuit that was recently settled by the Department of Education. The motion could block the department’s agreement to automatically discharge $6 billion in student debt for 200,000 borrowers with pending borrower-defense claims.
The motion from Career Education Colleges and Universities, the largest national organization representing for-profit colleges, claims that the colleges in the settlement were not given the chance to respond to pending borrower-defense claims alleging that they had defrauded former students. The motion was expected, as CECU stated that it planned to pursue legal action as soon as the department announced the settlement.
