Betsy DeVos Photo: Tom Williams/CQ Roll Call/Getty Images

The Department of Education will cancel federal loans for about 1,500 defrauded students at two shuttered art institutions, reports the New York Times.

Why it matters: This represents a "rare victory" from Secretary of Education Betsy DeVos, who has limited relief programs for students who claim they've been deceived by the "career-school chain," writes the Times.

Yes, but: Some borrowers will still owe money on the federal loans they took out before Jan. 20, the department wrote in an email sent Friday.

Context: Students at the Art Institute of Colorado and the Illinois Institute of Art sued the Education Department in October to have their loans cleared, per the Times.

  • The schools' closures were part of an ongoing saga involving Dream Center Education Holdings — which owned several schools part of the Art Institutes, South University and Argosy University brands, according to the Times.
  • The Dream Center, owned by a Christian nonprofit, purchased the for-profit schools in 2017, and suddenly closed them a year later with millions of dollars in federal financial aid still missing, per the Times.

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