The Biden administration has announced the cancellation of approximately $37 million in student loans for the University of Phoenix.
The decision impacts over 1,200 borrowers who attended the University of Phoenix between late September 2012 and December 2014. The move comes in response to allegations that the for-profit institution falsely advertised relationships with prominent companies, including Fortune 500 firms, and implied that students could use these connections to secure jobs.
The University of Phoenix had previously settled similar allegations with the Federal Trade Commission (FTC) in 2019, agreeing to pay $191 million. This loan discharge aligns with the Biden administration’s goal of holding poorly performing and deceptive institutions accountable, particularly in the for-profit education sector. The Education Department also plans to seek reimbursement of the cancellation costs from the owners of the University of Phoenix.
The Biden-Harris administration and the US Department of Education have aggressively pursued opportunities to cancel student loans ever since being rebuffed by the Supreme Court over the summer.