The Education Department is discharging any remaining loans for more than 260,000 borrowers who attended Ashford University and will move to bar a key executive at Ashford’s former parent company from the federal financial aid system, the agency announced Wednesday.
The agency’s action, totaling $4.5 billion, builds on an August 2023 decision to forgive $72 million in loans for 2,300 former Ashford students after finding that the college repeatedly lied to them about the cost, time requirement and value of its degree program. The discharges through the department’s borrower-defense program are among the largest in the program’s history. Wiping out the loans for Corinthian College students cost the department $5.8 billion, while the discharges for former ITT Technical Institute students totaled $3.9 billion.
The University of Arizona acquired the predominantly online institution Ashford in 2020 and rebranded it as the University of Arizona Global Campus. At first, the university partnered with Zovio Inc., a publicly traded company that owned Ashford, to run the rebranded entity but decided in 2022 to buy Zovio’s assets. The University of Arizona has since moved to completely absorb the online campus.
Borrowers who attended Ashford from March 1, 2009, through April 30, 2020, are eligible for relief.
“Numerous federal and state investigations have documented the deceptive recruiting tactics frequently used by Ashford University,” said U.S. under secretary of education James Kvaal in a statement. “In reality, 90 percent of Ashford students never graduated, and the few who did were often left with large debts and low incomes. Today’s announcement will finally provide relief to many students who were harmed by Ashford’s illegal actions.”
The Biden administration has forgiven $34 billion via borrower defense for 1.9 million borrowers, the department said.
But forgiving loans for Ashford students isn’t enough for the department. Officials proposed a governmentwide debarment of Andrew Clark, who in 2004 founded Bridgepoint Education, which later became Zovio. He stepped down in March 2021.
The debarment would mean Clark could no longer be employed in any role at any institution that receives funding from Title IV of the Higher Education Act of 1965, which authorizes federal financial aid programs, for at least three years.
“The conduct of Ashford can be imputed to Mr. Clark because he participated in, knew, or had reason to know of Ashford’s misrepresentations,” the department said in a news release. “Mr. Clark not only supervised the unlawful conduct, he personally participated in it, driving some of the worst aspects of the boiler-room-style recruiting culture.”
The department’s Office of Hearings and Appeals has final say on whether to debar Clark, who can contest the decision.
