Department of Education forgiving $171 million in debt owed by students of a bankrupt for-profit college

The U.S. Department of Education will forgive $171 million of debt owed by more than 11,000 former students of the for-profit school Corinthian Colleges Inc., which declared bankruptcy in 2015.

The government is forgiving the loans under a federal law known as the "borrower defense," the Los Angeles Times reports, which relieves the debt of people able to prove they've been defrauded. The now-defunct Corinthian ran several colleges, including Heald, Everest, and WyoTech, which had high tuition rates and few admission requirements. In March, a judge in San Francisco County found that Corinthian made false or misleading statements about job placement rates for graduates, and the company was ordered to pay $820 million to students. When it claimed bankruptcy, Corinthian claimed to have $143 million in liabilities and only $19 million in assets.

The government is only looking at claims of students who took out loans in 2010 or later, and the average amount of debt relief per student is $15,280, the Times reports. Since 2010, nearly 350,000 Corinthian students have taken out about $3.5 billion in federal loans. Former student Tasha Rincon, 34, told the Times she owes more than $46,000 in loans for classes she took at an Everest campus in Ontario, California. She said she studied to become a probation officer, and was told by Corinthian that 93 percent of students in the program would get well-paying jobs. She could only find a minimum wage job as a security guard, and now works three hours a day serving lunch at a high school.

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