Biden-Harris Administration authorizes $6.1 billion student loan discharge for Art Institutes attendees

The Biden-Harris Administration has officially given the green light for over $6.1 billion in automatic student loan relief to almost 317,000 borrowers who were enrolled at any Art Institute campus from January 1, 2004, to October 16, 2017. The U.S. Department of Education has uncovered that The Art Institutes and its parent company, Education Management Corporation (EDMC), were engaged in extensive and significant misrepresentations concerning postgraduation employment rates, salaries, and career services during that period. After EDMC sold its remaining Art Institute campuses in October 2017, all existing Art Institute campuses shut down under new ownership in September 2023. The total student relief granted by the Biden-Harris Administration now stands at nearly $160 billion, benefiting close to 4.6 million borrowers.

“For over a decade, hundreds of thousands of optimistic students borrowed billions to attend The Art Institutes, only to receive nothing but deceit in return. This ends today, thanks to the efforts of the Biden-Harris Administration in collaboration with the attorney general offices of Iowa, Massachusetts, and Pennsylvania,” expressed U.S. Secretary of Education Miguel Cardona. “It is crucial to shield borrowers from exploitative institutions and strive for an educational system that is affordable for both students and taxpayers.”

The Department conducted an independent review of evidence provided by the attorney general offices of Iowa, Massachusetts, and Pennsylvania, which conducted thorough investigations and filed lawsuits against The Art Institutes and EDMC. Materials obtained from these investigations, including internal employment data, admissions training manuals, and employment advertisements, were shared by the attorneys general of Pennsylvania and Iowa. Furthermore, the Massachusetts attorney general contributed information acquired during an investigation into the New England Institute of Art—the Massachusetts Art Institute campus, which included internal employment verification forms, other graduate employment outcome records, advertisements, and testimonials from former students and employees.

This announcement exemplifies the strong partnership between the Department and state attorneys general, underscoring their joint commitment to safeguarding federal student loan borrowers from predatory educational institutions.

“The Art Institutes exploited the aspirations of students seeking to enhance their lives through education,” remarked Federal Student Aid Chief Operating Officer Richard Cordray. “While we cannot restore the lost time of these students, we can alleviate the burden of their debt. We remain dedicated to collaborating with our federal and state partners to protect borrowers.”