Relief en route for con students at MN School of Business, Globe U
Alumni of the Minnesota School of Business and Globe University who took out federal loans or went through the disgraced college criminal justice program are now receiving financial aid.
The Minnesota attorney general’s office on Thursday announced $ 23.6 million in federal student loan cancellation and an additional $ 15.6 million in restitution for about 3,000 former students who obtained illegal loans and 920 former students who were enrolled in the college fraudulent criminal justice program.
The payments are part of a deal that resolves a lawsuit brought by the state of Minnesota against schools in 2014, alleging consumer fraud and illegal lending practices. After a settlement was reached in March, the U.S. Department of Education and a federal bankruptcy court approved the payments, which began Thursday.
Attorney General Keith Ellison said in a press release that he was “heartbroken” for students who were taking school criminal justice programs because they were wasting their time and money and faced with a crushing debt.
“From today, the money will finally return to the pockets of the students who were swindled by the misrepresentation of MSB and Globe and who charged illegal interest rates,” he said. declared. “I am happy that everyone involved finally gets closure and a measure of justice.”
The news follows multiple court battles involving two trials, multiple appeals and bankruptcy filings by schools. All Minnesota School for Business and Globe University sites closed in the state, Wisconsin, and South Dakota by 2017.
A Hennepin County district judge found in 2016 that schools had committed consumer fraud by telling students they could pursue careers as a police or probation officer by enrolling in programs leading to a criminal justice degree that cost between $ 40,000 and $ 80,000. The programs did not provide the education necessary to pursue these careers.
Ellison’s office also accused the schools of violating Minnesota laws by granting student loans at “predatory” interest rates. The courts accepted, declaring the loans void and subject to full repayment.
Schools issued partial refunds totaling $ 3.7 million in 2018 before delaying further refunds when they filed for bankruptcy.
Students who enrolled in the schools’ criminal justice programs from 2009 to 2016 and who submitted relief requests will receive a student loan rebate from the federal government.
Eligible students will also be reimbursed almost the full cost of what they paid to participate in programs and payments on federal student loans. Restitution will also be given to students who have obtained illegal loans through schools with interest rates of up to 18%.
Applicants will receive a notice from the US Department of Education regarding the loans.
The Attorney General’s office is also asking for a federal loan forgiveness for students who attended another for-profit university, ITT Technical Institute, which closed in 2016. Ellison got $ 2.6 million in relief from private debt for these students in the colonies in 2019 and 2020, according to its press release. He’s also looking to expand debt relief for students who have taken out loans to attend Argosy University, another for-profit school.
Resources for students who were enrolled in schools can be found at bit.ly/39WkofR. Consumers with questions can call 651-296-3353 or 1-800-657-3787.
Alex Chhith • 612-673-4759