They started out as the Corinthian Six. Supported by an offshoot of the Occupy Wall Street movement, their numbers grew.
Now the student debt strikers number over 100, and they have the attention of the federal government. Yesterday the student debt strikers met with high-ranking officials from the Consumer Financial Protection Bureau, the Treasury Department, and the Department of Education.
What they are asking for is fairly simple. They want all of their federal loans forgiven. Their proposal to the government was that not only should their existing debt be forgiven, but they also want money they perviously paid to be returned.
The highly simplified version of their complaint would be as follows: The Federal government had a duty to supervise the colleges that received federal loans. Corinthian College mislead the students who attended. Because of the actions of Corinthian, and the inaction of the Federal Government, students should not be expected to pay back federal loans taken out to attend Corinthian.
Here is what we do know about their claim:
- Corinthian College has been the subject of lawsuits brought by the federal government,
- The government forced Corinthian to shut down a number of schools, and
- The government has forgiven a percentage of the debt owed by current Corinthian students affected by the shut down.
A spokesman from the Department of Education described the experience of the Corinthian students as troubling and said that, “We will review every claim to borrower’s defense and continue to investigate Corinthian to help students as much as possible.” The Department of Education declined to give a timeline for this review.
What does this mean for other federal loan borrowers?
At this point it is hard to say. The loans at issue deal with some of the most questionable for-profit college tactics. If the government chooses to release these students from their debt obligations, it would set an interesting precedent.
At the very least, some good is coming out of this very ugly situation. The media attention surrounding the Corinthian Six and their problems has undoubtedly shed some light on some for-profit college tactics. Consumers, and the federal government, should now be in a better position to prevent this situation from repeating itself.