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King Approved as Education Secretary, Despite Declining to Help Student Loan Fraud Victims

Although not finalized, the new framework already aims to exclude many defrauded borrowers.

On Monday evening, the US Senate voted to approve the nomination of Dr. John King Jr. as Secretary of Education — a position that grants him unique authority to grant relief to the wide swath of Americans who have been defrauded by for-profit colleges.

King has thus far declined to act, despite having served as the acting Secretary of Education since January. He has subsequently become the subject of ire of thousands of debt-saddled college students who have appealed to the department to forgive their obligations to for-profit schools that fraudulently lured them into traps

One school, Corinthian Colleges, filed for bankruptcy last year after the department fined it $30 million for lying to students about job placement prospects and accreditation. The Consumer Financial Protection Bureau followed up by levying more than $500 million in fines, which the shuttered school was unable to pay.

The Secretary of Education has unique power to relieve students of their federally-guaranteed student loan obligations under a rule called “Defense to Repayment” — one that the Obama administration has thus far refused to widely invoke.

Last year, fifteen former Corinthian students declared a debt strike and descended on Washington to tell their stories to lawmakers and department officials. Former Education Secretary Arne Duncan promised relief for them last June. So far, little has materialized.

In the intervening months, roughly 200 former Corinthian students have joined the strike, and more than 5,000 students of other private for-profit colleges have asked the Department of Education for debt forgiveness — through a portal set up by the Debt Collective organization, which has been representing the strikers.

Instead of unilaterally wiping clean the student’s debt, King opted earlier this year to formulate new regulations through a lengthy rule-making process that he claims will eventually expand the department’s debt forgiveness tools. The debt strikers say this is insufficient.

“They’re just now trying to cover their own ass. They don’t want to give relief,” Alicia Stevens, a 70-year-old student debt striker told The Sentinel last month. “We didn’t ask for this.”

Although not finalized yet, the new framework already aims to exclude many defrauded borrowers. For one, it has a two-year statue of limitation to ask for relief; students said that it often isn’t clear they’ve been defrauded until well after two years have passed. The proposed regulations also bar students’ parents from forgiveness for loans they took out on behalf of their kids. Additionally, it would force students to deal with schools on an individual basis, rather than through a class action.

One of the most vocal supporters of the student debt strikers on Capitol Hill has been Sen. Elizabeth Warren (D-Mass.). Ahead of Monday’s consideration, she said in a floor speech that it has been “practically impossible to get the department to pit the interest of students ahead of the interests of private contractors and for-profit colleges.”

Warren, however, voted Monday to confirm King in a 49-40 vote, saying he’s taken “serious steps in the right direction.”

“@JohnKingatED didn’t create these problems at @usedgov — but he has a lot of work to do to get the Dept’s higher ed house in order,” Warren tweeted afterward.

A handful of Republican Senators joined Democrats to support King’s nomination, including former Education Secretary under George HW Bush, Sen. Lamar Alexander (R-Tenn.). Alexander said he saw practical value in voting “yea.”

“This vote is not about whether one of us would have chosen Dr. King to be the education secretary,” Sen. Alexander said in remarks on the floor. “Republicans won’t have the privilege of picking an education secretary until we elect the president of the United States.”

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