Aug 30, 2022 - Politics & Policy

Biden admin to cancel $1.5B in loans for Westwood College students

Miguel Cardona, US secretary of education, during a news conference with US President Joe Biden, left, in the Roosevelt Room of the White House in Washington, DC, US, on Wednesday, Aug. 24, 2022.

Miguel Cardona, U.S. secretary of education, with President Biden. Photo: Bonnie Cash/UPI/Bloomberg via Getty Images

The Department of Education announced Tuesday that it will cancel $1.5 billion in student debt for 79,000 students who attended the now-defunct Westwood College.

The big picture: The news comes less than a week after the Biden administration announced broad student loan forgiveness for millions of Americans.

  • The Education Department said Westwood College lied to students about the value of its programs, as well as their future job prospects.
  • The Department of Education earlier this month canceled all remaining federal student loans to borrowers that attended ITT Technical Institute over a decade for similar reasons.
  • The department "has now approved $14.5 billion in discharges for nearly 1.1 million borrowers whose colleges took advantage of them," per Tuesday's announcement.

Driving the news: "The Department has [...] concluded that the school engaged in widespread misrepresentations about the value of its credentials for attendees' and graduates' employment prospects," the announcement said.

  • The department said it will clear federal student loans for borrowers who attended any location of Westwood College between January 1, 2002 through November 17, 2015. The school closed in 2016.

What they're saying: "Westwood College's exploitation of students and abuse of federal financial aid place it in the same circle of infamy occupied by Corinthian Colleges and ITT Technical Institute," Education Department Under Secretary James Kvaal said the announcement.

  • "Westwood operated on a culture of false promises, lies, and manipulation in order to profit off student debt that burdened borrowers long after Westwood closed," Kvaal added.

Go deeper: Student loan forgiveness in hands of "understaffed and overcommitted" agency

Go deeper