Statement On Student Loan Discharge for Borrowers Cheated by Marinello Schools of Beauty | Press Release

April 28, 2022

BOSTON – Today, Education Secretary Miguel Cardona announced that 28,000 borrowers who attended Marinello Schools of Beauty will receive loan discharges totaling approximately $238 million, as part of a group borrower defense discharge.

 

Statement from Eileen Connor, Director of the Project on Predatory Student Lending

“Today’s announcement is welcome news for the many thousands of borrowers who were scammed by Marinello Schools of Beauty. This is a step in the right direction and confirms that the Department of Education has the power to discharge loans and act on group borrower defense claims when faced with evidence of widespread fraud. Secretary Cardona must act more urgently to use this authority to discharge the loans of hundreds of thousands of borrowers who are equally owed cancellation — including those cheated by ITT, Corinthian Colleges, DeVry, Brooks, and more.

The Department of Education must also work harder to follow through on these promises. It has been over a year since many of our clients were told that their borrower defenses would be granted and their loans cancelled — yet many are still waiting for that promise to come to fruition. Borrowers who were defrauded by their schools need bold action, not empty promises.”

 

The Project on Predatory Student Lending represented borrowers in the lawsuit Vara v. Cardona in which a judge confirmed that the Department of Education has a legal obligation to process group borrower defense applications submitted by state attorneys general and ordered cancellation of the loans of 7,200 Massachusetts borrowers who were cheated by Corinthian Colleges. Borrowers in the case Pratt v. Cardona were also promised relief last year when the Department announced it would end the previous administration’s unlawful partial relief policy for adjudicating borrower defense applications. In both cases, a significant number of borrowers are still waiting for the relief they are owed.

The Project has represented more than one million former for-profit college students and won landmark cases against the Department of Education and predatory colleges. Its litigation has helped cancel more than $2 billion of fraudulent student debt.

 

About the Project on Predatory Student Lending

Established in 2012, the Project on Predatory Student Lending represents former students of predatory for-profit colleges. Its mission is to litigate to make it legally and financially impossible for federally-funded predatory schools to cheat students and taxpayers. The Project has brought a wide variety of cases on behalf of former students of for-profit colleges. It has sued the federal Department of Education for its failures to meet its legal obligation to police this industry and stop the perpetration and collection of fraudulent student loan debt.

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