DeVos proposes restrictions on Obama-era provisions aiding students defrauded by for-profit schools

DeVos proposes restrictions on Obama-era provisions aiding students defrauded by for-profit schools
© Greg Nash

Education Secretary Betsy DeVosBetsy DeVosPardon talk intensifies as Trump approaches final 24 hours in office Azar in exit letter to Trump says Capitol riot could 'tarnish' legacy READ: Departure letter from HHS Secretary Azar to Trump MORE on Wednesday reportedly proposed a restriction on Obama-era rules meant to help defrauded students that activists say would shield for-profit colleges from students' claims.

According to The New York Times, the Education Department will establish a federal standard for what constitutes "misrepresentation" when determining whether a for-profit college deceived students into enrolling before saddling them with mountains of financial debt.


Under the new standard, a student must be able to prove "reckless disregard" on behalf of an institution in a debt forgiveness claim before it is considered. The proposal also would institute penalties on schools with signs of poor financial health, such as high numbers of students seeking loan discharges.

DeVos told the Times in a statement that her department remains committed to protecting students from fraud.

“Our commitment and our focus has been and remains on protecting students from fraud," she said, while noting that the new rules establish “clear rules of the road for higher education institutions to follow” and hold "institutions, rather than hardworking taxpayers, accountable for making whole those students who were harmed by an institution’s practices."

Student debt watchdog groups such as the Consumers Union panned the proposal, however, calling it an attempt to shield for-profit institutions with reputations of preying on students.

“The Department of Education is turning a blind eye to widespread fraud and abuse at for-profit schools that left thousands of students in debt without a meaningful education,” Suzanne Martindale, a senior attorney for the Consumers Union told the Times. “Instead of helping defrauded students cancel their debts and move on with their lives, these proposed rules would shield poor-performing schools from being held accountable for their misconduct.”

Other critics noted DeVos's history of staffing the Education Department with executives who previously worked for for-profit colleges, a decision that has drawn heavy criticism since she joined the Trump administration last year.

“With the stroke of a pen, Secretary DeVos and her team of former for-profit college executives have proposed giving fraudulent institutions de facto immunity while effectively stripping their victims of a realistic path to debt relief,” Aaron Ament, the president of the National Student Legal Defense Network, told the newspaper.