17 Civ. 8790 (S.D.N.Y.)
In November 2017, the Special Litigation Unit filed Colon v. DeVos, on behalf of Tina Carr and Yvette Colon, student loan borrowers who were defrauded by the for-profit college they attended, the Sanford-Brown Institute. Ms. Carr and Ms. Colon are suing the Department of Education and Navient Corporation, a private lender, seeking a declaration from the Court that would block the enforcement of their student loan debt.
Sanford-Brown, owned by Career Education Corporation (CEC), engaged in outright deception to induce Ms. Carr and Ms. Colon to enroll in its vocational programs. Both students entered programs in medical fields, only to find out after the fact that the school lacked the necessary accreditation and did not provide adequate training. Sanford-Brown also lied to Ms. Carr and Ms. Colon about its dismal track record in preparing students for medical vocations.
Unfortunately, Ms. Colon and Ms. Carr are not alone in having been defrauded by SBI. The Office of the Attorney General of the State of New York (“OAG”) pursued CEC for these deceptions, and found that CEC systematically cheated students like Ms. Carr and Ms. Colon. Although SBI representatives cited job placement statistics to Ms. Carr of 80%, the OAG found that the actual placement rate was only 26.1%. Further, the OAG demonstrated that CEC-operated schools like SBI committed widespread deception concerning programmatic accreditation, and failed to disclose that graduates generally could not transfer credits to legitimate schools. The OAG concluded that these practices violated New York’s consumer protection statutes.
In March 2015, NYLAG submitted defense to repayment applications on behalf of Ms. Carr and Ms. Colon to the Department of Education and Navient. The applications invoked the borrowers’ contractual right to cancellation of their loans based on Sanford-Brown’s deceit. Despite Ms. Carr and Ms. Colon’s clear legal entitlement to loan cancellation, the Department of Education and Navient have refused to consider their defenses, leaving Ms. Carr and Ms. Colon to struggle—along with tens of thousands of other borrowers whose defenses have been ignored—with burdensome and insurmountable student loan debt.
“Tina Carr and Yvette Colon did everything right. They submitted evidence — substantiated by the Office of the New York State Attorney General — that Sanford-Brown deceived them into taking out loans to get an ‘education’ that would never lead to gainful employment,” said Jane Greengold Stevens, Co-Director of NYLAG’s Special Litigation Unit. “Almost three years later, Ms. Carr, Ms. Colon, and too many other students are still suffering every day from damaged credit and the threat of collection on these unlawful loans. We had no choice but to go to court.”
NYLAG Attorneys: Danielle Tarantolo, Jane Greengold Stevens, Shanna Tallarico, Jessica Ranucci
Co-Counsel: Project on Predatory Student Lending of the Legal Services Center of Harvard Law School
- November 12, 2017: Complaint
- November 12, 2017: The Washington Post – Lawsuit Seeks New Recourse on For-Profit College Fraud