Cases

Gold v. DeVos

The U.S. Department of Education agreed to discharge approximately $63,000 of student loan debt owed by Christine Gold, who was defrauded by the predatory Court Reporting Institute in Seattle. The discharge is the result of a lawsuit by Student Defense and comes after years of waiting. The Department ignored Ms. Gold’s valid borrower defense claim, just as it is currently ignoring nearly 180,000 such claims from other students around the country.

“This settlement represents justice for Christine Gold, though she can never get back the years she wasted because of the Court Reporting Institute’s lies,” said Student Defense Counsel Robyn Bitner. “There is no excuse for further inaction by the Department of Education. Secretary DeVos should do the right thing and discharge the remaining loans for other CRI students immediately.  It shouldn’t take a lawsuit by every defrauded student for the Department to discharge their loans like the law requires.”

“All CRI students deserve relief,” said Washington Attorney General Bob Ferguson, who submitted a group borrower defense claim on behalf of CRI students. “The Department of Education needs to do the right thing and help students who have been saddled with unfair debt for more than a decade as a result of CRI’s unfair and deceptive practices.”

A brief video of Christine Gold talking about her loan forgiveness is available here.

The Court Reporting Institute (CRI) was a for-profit school that promised students it would prepare them for careers as court reporters. Many students filed complaints against CRI over the years. The school shut down in 2006 after the Washington State Workforce Training and Education Coordinating Board determined it had engaged in unfair and deceptive business practices and pulled its license. Ms. Gold attended CRI from 2001 to 2005. Like many of her fellow classmates, she withdrew without a credential after realizing that the school had been misleading her and that she was not gaining valuable or marketable skills.

After its investigation, the Workforce Board came to a number of damning conclusions, including that the school:

  • Falsely claimed that students could complete its night school program in two and a half years, when it knew that the few students who actually completed the program took more than five years;
  • Had a six percent completion rate and only half of that minuscule percentage of students were working in the field six to nine months after graduation;
  • Advertised a 100 percent job placement rate for its night program when it knew only a handful of students obtained any employment in the field; and
  • Employed instructors unqualified to teach their subject matter.

The U.S. Department of Education was aware of all these findings, in fact referencing them in subsequent communications with other CRI student loan borrowers. However, the Department never told borrowers of their right to assert CRI’s deceptive practices as a defense to repayment. Borrower defense, as it is known, refers to a student’s right to have loans forgiven if a school misled them or engaged in other misconduct.

Although the Department never informed Ms. Gold of the option, she nevertheless submitted a borrower defense claim to the Department in May 2016, citing a pattern of deception and misrepresentation wholly consistent with the findings of the state Workforce Board’s investigation. Several months later, the Washington State Attorney General submitted a group claim, seeking the discharge of federal student loans for all students who attended CRI’s Seattle and Tacoma campuses.

In November 2018, Student Defense filed a lawsuit on Ms. Gold’s behalf, citing the Department’s unlawful delay in considering her claim. After agreeing to participate in mediation, the Department has now agreed to discharge nearly all of Ms. Gold’s outstanding debt, accumulated interest, and fees. 

Press Coverage

MarketWatch: How one woman persuaded the government to forgive $63,000 in student-loan debt she incurred 15 years ago

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