Biden admin cancels more student loan debt — $4.8 billion for 80,300 borrowers

President Biden announced another round of federal student loan debt cancellation on Wednesday despite the Supreme Court's rejection earlier this year of the administration's previous $430 billion forgiveness program.

The White House stated that the administration plans to cancel $4.8 billion in federal student loan debt for an additional 80,300 borrowers.

"This brings total approved debt cancellation by the Biden-Harris Administration to $132 billion for over 3.6 million Americans," the White House boasted in a Wednesday press release.

The latest round of debt cancellation aims "to fix Public Service Loan Forgiveness, so teachers, members of the military, nurses, and other public service workers get the relief they have earned," Biden stated. "And it's because of actions my Administration took to make sure that borrowers who have been in repayment for at least 20 years – but didn't accurately get credit for student loan payments – get the relief they are entitled to."

Biden's announcement bragged about the administration's achievements for students and borrowers, much of which has been at the expense of American taxpayers.

"Today's announcement comes on top of all we've been able to achieve for students and student loan borrowers in the past few years," the press release continued. "This includes: achieving the largest increases in Pell Grants in over a decade to help families who earn less than roughly $60,000 a year; fixing the Public Service Loan Forgiveness program so that borrowers who go into public service get the debt relief they're entitled to under the law; and creating the most generous Income-Driven Repayment plan in history – the SAVE plan."

In June, the Supreme Court struck down the administration's plan to implement sweeping student debt forgiveness that would have canceled $10,000 of debt for individuals earning less than $125,000 yearly and married couples earning less than $250,000 yearly. Borrowers who received Pell Grants would have been eligible to have an additional $10,000 of their debt canceled under the administration's program.

"In the wake of the Supreme Court's decision on our student debt relief plan, we are continuing to pursue an alternative path to deliver student debt relief to as many borrowers as possible as quickly as possible," Biden stated Wednesday.

A November report from the Government Accountability Office, a federal watchdog, found that the administration's unilateral loan cancellation plan failed to implement safeguards to protect against potential fraud.

Before the Supreme Court blocked the program, the administration had automatically approved 26 million borrowers to be eligible to receive the debt cancellation, the GAO found. Over 12 million of those applicants were reportedly approved without submitting any income documentation. Another 2 million of those borrowers were automatically approved based on income reported on previous financial aid applications or loan repayment plans that contained potentially outdated information, the watchdog's report stated.

"[The Education Department] and GAO have both previously identified problems with people underreporting their income on these forms, but the department did not take any steps to verify incomes for these borrowers before automatically approving them for relief. Federal internal control standards state that managers should take steps to mitigate fraud risks, but Education did not deploy any tools to verify these borrowers' incomes or ensure they were eligible for relief," the GAO reported.

In August, the administration provided $72 million in debt cancellation to 2,300 borrowers who were "misled and deceived" by Ashford University, which is based in San Diego, California. According to a lawsuit filed in 2017, the school "made numerous substantial misrepresentations" of its institution.

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