The Art Institutes, once a giant chain of for-profit schools, have recently come under scrutiny for making “pervasive and substantial” misrepresentations to prospective students regarding post-graduation employment rates, salaries, and career services. This has resulted in the Biden administration forgiving over $6.1 billion in student debt for 317,000 former students who enrolled between Jan. 1, 2004, and Oct. 16, 2017.
The U.S. Department of Education, after reviewing evidence provided by the attorneys general of Iowa, Massachusetts, and Pennsylvania, confirmed that The Art Institutes and its parent company, the Education Management Corporation (EDMC), engaged in deceptive practices. This has led to the automatic forgiveness of loans for eligible borrowers, regardless of whether they had previously applied for relief.
Many students who attended The Art Institutes borrowed significant amounts of money in hopes of pursuing their education and securing a better future. However, they were ultimately left with “little but lies in return,” according to U.S. Secretary of Education Miguel Cardona. The falsified average salaries among graduates, including the inclusion of professional tennis player Serena Williams’ income to inflate statistics, have had a long-lasting negative impact on former students.
As a result of these revelations, EDMC sold its remaining Art Institute campuses in 2017, and all schools closed under separate ownership in 2023. The company filed for bankruptcy in 2018, with Goldman Sachs having previously held a sizable share of the organization. The repercussions of these actions have not only affected students but also raised concerns about predatory institutions and the need for a more affordable higher education system.
The student debt forgiveness for Art Institute graduates marks a significant step in rectifying the injustices they faced. It serves as a reminder of the importance of holding educational institutions accountable for their actions and prioritizing the well-being of students. As the government continues to address issues of fraud and deception in the education sector, it becomes increasingly crucial to create a more transparent and accessible system that benefits both students and taxpayers alike.