St. Paul, MN (KROC-AM News) – Hundreds of former students at two former for-profit Minnesota colleges may soon see their student loan debt wiped out and receive additional compensation.
Minnesota Attorney General Keith Ellison announced an interim agreement totaling $ 42 million to benefit 920 former students of the Minnesota School of Business and Globe University. The Minnesota School of Business operated the campus in northwest Rochester until both post-secondary schools closed three years ago after the US Department of Education removed them from the federal student loan program. . This follows a Minnesota court ruling that found schools committed consumer fraud by deceiving students.
A press release issued by Ellison’s office says the courts have also quashed high-interest student loans issued by schools and ordered institutions to repay affected students. About $ 3.7 million was returned to students in 2018 before the Minnesota School of Business and Globe Temple University filed for bankruptcy. More than $ 23 million of the settlement will go towards the forgiveness of federal student loan debt, while $ 15.6 million will be paid as compensation to students from the criminal justice program that was at the center of the actions. consumer fraud.
“This deal is set to finally resolve one of the biggest consumer fraud cases ever brought by the Attorney General’s office and one of the only for-profit college cases to ever be tried in America.” While no amount can make up for all the pain and loss these students and their families have suffered, I hope the relief that my office worked so hard to earn will allow them to start paying their lives again after this terrible experience. .
Ellison says the settlement is part of a plan to finalize bankruptcy proceedings involving for-profit schools. It has yet to get final approval from the Department of Education and the bankruptcy court.
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