Massachusetts Attorney General Maura Healey was able to announce that she came to a successful settlement with a for-profit education company.
Massachusetts students that were defrauded by an online education company will soon have their student loans discharged, thanks to Attorney General Maura Healey. This week, AG Healey announced that she reached a settlement with the Tennessee-based Southeast Financial Credit Union. The settlement was reached in connection to The College Network, a for-profit education company that sold online study guides and educational resources to students in the healthcare industry.
Under the terms of the settlement, the credit union agreed to discharge $450,000 in loan debt and provide $200,000 in cash refunds. They are also required to remove any negative entries from borrowers’ credit reports.
AG Healey alleges the College Network misled students about the nature of the materials and services they were purchasing. “This settlement holds the lender accountable for profiting from this scheme and will provide $650,000 in discharges and refunds to the consumers,” she said in a statement.
The Attorney General’s office investigated The College Network’s activity from January 2010 to March 2016. The investigation revealed that the company marketed educational material promising to help students in the healthcare industry score well on their exams and courses.
These materials were packaged as online modules and study guides and cost could thousands of dollars each. Since these materials were too expensive for most students to purchase outright, the company arranged loans for the students, many through Southeast Financial Credit Union.
The College Network allegedly misrepresented the quality of their study materials and violated state consumer protection laws. The company went out of business in 2017, leaving hundreds of students in debt with nothing to show for it.
One student borrowed $8,000 to purchase 11 modules from The College Network in hopes that they would help her become a registered nurse. Not only were the modules themselves not helpful, the company lied about their program affiliations.
Attorney General Healey has built a reputation on standing up for borrowers victimized by for-profit schools. In April, she reached a similar settlement with the Florida-based We Florida Financial. The credit union agreed to discharge $898,000 in loans given to Massachusetts students to purchase educational materials from The College Network. In total, she’s has helped discharge over $7 million in loans for students who were allegedly misled by for-profit schools and education companies.
Borrowers who are eligible for student loan relief will be contacted by the Attorney General’s Office. And borrowers with unresolved complaints about The College Network should contact Attorney General Healey’s Office for more information.