NEW ORLEANS — A Biden administration plan to provide student debt relief for people who say they were victims ofby trade schools or colleges is “almost certainly unlawful” a federal appeals court said in a ruling blocking enforcement of the policy against a group of privately owned Texas institutions.
At issue are rules that broadened existing policy, affecting students who borrowed money to attend colleges and universities that are determined to have misled them on matters such as whether their courses would actually prepare them for employment in their field or the likely salary they would earn upon obtaining a degree. According to the opinion, if a federal student loan is discharged under the policy, the government can seek reimbursement from the school accused of the misleading practices.
Career Colleges and Schools of Texas said the rules are so broad that they cover even unintentional actions by a college. They also said the rule unconstitutionally gives an executive branch agency, the Department of Education, what amounts to the power of a court in deciding whether to grant claims for debt relief.