A group of student loan borrowers is asking a federal judge to enforce a $6 billion settlement they say the Biden administration has violated by missing a court-ordered deadline to cancel their debt.
The Education Department had until Jan. 28 to discharge the loans, issue refunds and repair the credit of about 200,000 borrowers who say their colleges defrauded them, but at least 55,000 of those people are still awaiting debt cancellation. Attorneys for the borrowers filed a motion Tuesday for the court to intervene and order the department to promptly provide full relief to the group.
Attorneys wrote to the Justice Department at the beginning of February and accused education officials of breaching the terms of the deal. Within weeks, Justice Department attorneysthe Education Department was further behind than initially disclosed, blaming student loan servicers that manage the government’s loan portfolio for supplying inaccurate information.
Hours after Tuesday’s filing, Judge Alsup issued an order requesting the student loan servicers responsible for discharging loans in the settlement appear before the court on April 24. He insists they show cause why they should not be held in contempt for “frustrating the settlement.”in July 2022 after several schools, including Lincoln Tech and Keiser University, said the deal did not assess the validity of the borrowers’ claims and would damage their reputation. On Dec. 5, the U.S.
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