Politico Morning Education reports that the U.S. Department of Education mistakenly collected debt from many thousands of students who had been defrauded by a failed online for-profit college and were previously unreported. The last time the Department acknowledged having hounded students in error, it was fined $100,000. Why not fine the Secretary and the officials in charge personally so that they get the message that it is wrong to pursue collections from students whose debt should have been forgiven? (Today’s Politico was underwritten by the Waltons.)

 

A COURT FILING THIS WEEK REVEALED TENS OF THOUSANDS OF ADDITIONAL CORINTHIAN COLLEGES STUDENT BORROWERS WERE TARGETED FOR COLLECTION BY THE EDUCATION DEPARTMENT. The new disclosures have infuriated plaintiffs of an ongoing lawsuit against the government.

— In October, after the Trump administration initially said it erroneously collected on the loans of some 16,000 Corinthian borrowers, a federal judge held DeVos in contempt of court and imposed a $100,000 fine for violating an order to stop collecting on student loans from the defunct for-profit college.

— Now, according to the department, that means a total of 45,801 borrowers “were erroneously taken out of forbearance or stopped collections status.” That includes the roughly 29,000 newly identified borrowers, plus the original 16,034 borrowers. “FSA has now placed all 45,801 borrowers in the correct status,” the government’s court filing said.

— What’s to blame for the mixup? The department said an “isolated communication” between Federal Student Aid and its contractors, plus “other logistical issues” caused the undercount. The government said FSA “now believes that it has an accurate account of existing borrower defense applicants.”

— “Students and taxpayers should be infuriated by the Department of Education’s complete disregard for student borrowers,” said Toby Merrill, director of the Project on Predatory Student Lending. “Secretary DeVos has already been found in contempt of court for her illegal collections on students. Now we find out the impact was far greater than previously reported, and she still hasn’t returned all the money owed to students. It is galling, it’s unlawful, and it can’t be tolerated.”