Education Department Reaches Historic Settlement with Defrauded Borrowers in Sweet v. Cardona

“The prospect of full student loan debt discharges in a final settlement to the Sweet case is welcome – and overdue – news for more than 200,000 borrowers who deserve relief under federal law. We congratulate our partners at the Project on Predatory Student Lending for their many years of advocacy on behalf of this class of defrauded borrowers, as well as the borrowers themselves who have been through years of turmoil. Their voices made this settlement possible.

“As the U.S. Department of Education continues to pursue a new borrower defense rule, this settlement serves as a reminder that predatory conduct, misrepresentations, deception, and outright fraud that leads to these claims cannot be tolerated. Schools and their owners who engage in this conduct must be held accountable, so they cannot continue to defraud students only to have taxpayers pick up the tab. The Sweet case powerfully demonstrates how broken the borrower defense process has been for defrauded borrowers.

“We celebrate this victory for one set of borrowers, and we resolve to continue advocating for a stronger process that centers the interests of students – not the institutions and owners that defraud them.”

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