DeVos in Contempt

DeVos in Contempt

On October 24th, a federal judge fined Educational Secretary Betsy DeVos $100,000 and held her in contempt of court.

DeVos received the fine because the Department of Education violated an order to stop collecting on student loans from people who had attended Corinthian Colleges. The Trump administration admitted in court this year that it had collected money from 16,000 students who attended the closed for-profit college.

Corinthian Colleges, based out of Southern California, was one of the world’s largest for-profit schools. At its peak, it had 105 campuses in the United States, more than 100,000 students and a revenue of over a billion dollars. The majority of the money it made came from federal grants and loans that students received.

In 2013, Kamala Harris, who was the Attorney General of California at that time, sued the school due to fraud allegations. This led to an investigation by the US Department of Education, which placed a hold on releasing federal funds to the school. Less than two weeks later, Corinthian announced they were closing down all their campuses.

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In 2016, the Department of Education forgave 11,000 loans owned by former Corinthian students. Two years later, the department tried to collect on some of those loans and continued to do so even after an order to stop.

While we applaud Harris’ prosecution of an apparently fraudulent school, how she thinks DeVos is now working for the defunct college is hard to understand. DeVos and the Department of Education have admitted there were errors made and as soon as they were discovered, steps were taken to correct the problem.

The fine, which will be paid by the government and not DeVos personally, is to be placed in a fund to help offset the expenses and damages incurred by the former students as a result of the erroneous collections.

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