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Credit…Sipa via Associated Press

In a pair of aggressive moves targeting for-profit college chains, the Education Department on Tuesday worn out about $4 billion in debts owed by students who attended ITT Technical Institute schools and sought to recoup $24 million from DeVry University.

The moves are a part of the department’s efforts to crack down on the for-profit education sector and help students who’ve been defrauded.

The agency said that it could routinely discharge all remaining federal loans for 208,000 borrowers who attended ITT Technical Institute schools from 2005 until the chain’s collapse in 2016.

It’s the second time that President Biden’s administration has routinely eliminated the debts of defrauded students, after an analogous move in June that forgave nearly $6 billion owed by greater than 500,000 former students at Corinthian Colleges, one other large for-profit chain that imploded.

Lately, too many for-profit colleges and profession schools have been caught defrauding and deceiving their students,” the education secretary, Miguel A. Cardona, said. “Their entire business model relied on driving students deep into debt, after which they laughed their way right to the bank.”

Each ITT and Corinthian went bankrupt years ago, leaving taxpayers on the hook for the debts now being forgiven for the colleges’ former students.

We do think it’s really vital for, especially, individual officials and leaders of those schools to take responsibility for the failures of those schools,” said Richard Cordray, the chief operating officer of the Education Department’s Federal Student Aid office. “That isn’t how things worked previously, and it’s one in every of the improvements we’re attempting to make.”

The actions come as Mr. Biden faces an imminent decision about whether to increase the federal student loan payment pause that began greater than two years ago, in March 2020. Payments are scheduled to restart in September, but loans servicers — who’ve been told by the federal government to carry off on sending out bills — expect Mr. Biden to increase the pause again, likely until 2023.

On the presidential campaign trail, Mr. Biden pledged to forgive $10,000 in student debt per borrower — a promise he has not yet fulfilled. His administration has to date focused on targeted actions which have eliminated $32 billion in loans for public service staff, permanently disabled borrowers, defrauded students and other people whose schools abruptly closed while they were enrolled.

The Education Department sent a claim this week to DeVry University, once one in every of the nation’s largest for-profit college chains, looking for $24 million to cover the prices of discharging its former students’ loans.

The chain so badly misled its students that Education Department officials agreed this yr to cancel the federal student loans of at the very least 1,800 of its former attendees. The motion on Tuesday is geared toward “recouping money for taxpayers, which is actually at all times a goal for us,” Mr. Cordray said.

DeVry was the primary — and to date, only — still-operating school at which the Education Department has approved claims through a relief system often known as “borrower defense to repayment.” This system lets borrowers who attended schools that broke consumer protection laws seek to have their federal loan debts worn out.

From 2008 to 2015, DeVry fraudulently lured in applicants with vastly inflated claims about their profession prospects, the Education Department said. The college advertised that 90 percent of its graduates who actively sought work landed jobs of their fields inside six months, but its actual placement rate was around 58 percent, agency officials said.

During that period DeVry was owned by Adtalem Global Education, which runs for-profit trade schools. Adtalem sold the varsity in 2018 to Cogswell Capital, an investment firm owned by the enterprise capitalist and financier Bradley Palmer. The department is pursuing Cogswell, the present owner, for payment, officials said.

“We’re in receipt of the notice from the Department and are reviewing it,” said Hessy Fernandez, DeVry’s public relations director. “We proceed to imagine the department mischaracterizes DeVry’s calculation and disclosure of graduate outcomes in certain promoting, and we don’t agree with the conclusions they’ve reached.”

Mr. Palmer didn’t reply to requests for comment.

DeVry has 20 days to file an appeal if it wishes to contest the agency’s recoupment request, Education Department officials said.

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