The department's guidance identifies April 12 as the earliest date students could have withdrawn from the program and still qualify for a closed-school discharge, which provides a path for students to receive full forgiveness of federal student loans if their institution closes while they are enrolled.The evidence:
The department did not have an estimate of the number of students expected to qualify for closed school discharge, but 100 were still enrolled and about 70 were on leave when the school shut down. Stein's office estimated that more than 300 students would qualify if exceptional circumstances were declared by DeVos. A Charlotte Law degree cost upward of $100,000.
Students who withdrew before April 12 will have the option to pursue loan discharge through a borrower-defense claim, which requires borrowers to meet a higher standard than a closed-school discharge. Borrowers seeking loan forgiveness through that route must demonstrate their program violated state law through an act or omission related to their federal student loan. (Students can also seek to transfer their Chalotte credits to another program but would not be eligible for closed school discharge if they do.)
A federal criminal investigation involving Charlotte School of Law was opened more than a year ago, according to recently unsealed court documents in a qui tam lawsuit....Another article:
The lawsuit was filed by Barbara Bernier, a former Charlotte School of Law professor, the Charlotte Observer reports. Her complaint (PDF)—which also names InfiLaw as a defendant and was filed in the U.S. District Court for the Middle District of Florida, claims that Charlotte School of Law manipulated bar exam and employment statistics by offering students who seemed unlikely to pass a $5,000 stipend to not take the test.
Bernier claims she has inside knowledge that hundreds of unqualified students were admitted to the school. She also alleges that student records were manipulated and that enrollment was inflated in an effort to increase profits through government-backed tuitions.The potential roadblock:
"Many candidates for admission (were) academically unqualified, and would be improbable candidates for admission in most other law schools," the lawsuit read.
The U.S. Department of Education has not approved any borrower defense applications since the beginning of the Trump administration, a department official told Democratic senators this month.A solution.
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