In its largest student loan forgiveness action ever, the Education Department said on Wednesday that it would wipe out $5.8 billion owed by 560,000 borrowers who attended Corinthian Colleges, one of the nation’s biggest for-profit college chains before it collapsed in 2015, the New York Times reported. The debt cancellation will be automatic, meaning former Corinthian students will not have to apply to have their debts canceled. The Education Department will eliminate any remaining balance on the federal student loans of those who attended any Corinthian campus or online program during the chain’s 20-year existence. “For far too long, Corinthian engaged in the wholesale financial exploitation of students, misleading them into taking on more and more debt to pay for promises they would never keep,” Education Secretary Miguel Cardona said. Corinthian became one of the most prominent examples of bad behavior in the often-troubled for-profit-college industry. Founded in 1995, the company acquired a string of schools nationwide and at its peak enrolled 110,000 students at more than 100 campuses. But allegations of illegal recruiting tactics, shoddy educational programs, and false promises to students about their career prospects and potential future earnings shadowed the company for years, leading to a string of investigations and lawsuits by state and federal agencies.
