Ellison: Tentative agreement would forgive $23M in debt for former MSB, Globe University students

Ellison: Tentative agreement would forgive $23M in debt for former MSB, Globe University students

Josh Skluzacek
Updated: March 16, 2021 03:05 PM
Created: March 16, 2021 02:09 PM

A tentative agreement could provide financial relief for hundreds of former Minnesota School of Business (MSB) and Globe University students.

Minnesota Attorney General Keith Ellison's office said Tuesday that the agreement with the schools, their owners and the U.S. Department of Education would provide close to 100% financial relief for 920 former students defrauded by the for-profit schools from 2009 through 2015.

As part of the agreement, $23.1 million in outstanding federal student loan debt would be forgiven and $15.6 million in cash compensation for students fraudulently enrolled in the schools' criminal justice program would be paid out.

The deal is still pending final approval from the court and the U.S. Department of Education.

Globe University files for bankruptcy, debts owed range from $10 to $50 million

"People take out student debt because they trust it will help them better afford their lives in the future. For students in the so-called "criminal justice" program, MSB and Globe University abused their trust," Ellison said. "These students were often low-income, often veterans, often people of color, often supporting families while working full-time. They wanted nothing more than to get a degree that would allow them to pursue a career in public service. What they got instead was a waste of their efforts and inescapable debt. What they went through is heartbreaking.

"This agreement should finally resolve one of the biggest consumer-fraud cases ever brought by the Attorney General's Office, and one of the only cases against a for-profit college ever brought to trial in America. While no dollar amount can make up for all the pain and loss that these students and their families experienced, I hope the relief my office has worked so hard to win will allow them to start affording their lives again after this terrible experience."

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