$238M worth of student loan debt from students of Marinello beauty schools to be canceled

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Students of Marinello Schools of Beauty - which closed in Feb. 2016 - will have their student loans discharged, the Department of Education announced Thursday.

Students of Marinello Schools of Beauty - which closed in 2016 - will have their student loans discharged, the Department of EducationThis applies to all 28,000 borrowers who enrolled in the schools from 2009 to Feb. 2016, totaling about $238 million, officials said.This is the first group discharge for defrauded borrowers to be approved since 2017, according to the department.

To date, the DOE had approved approximately 300 borrower defense claims at Marinello under findings reached last July that Marinello made widespread, substantial misrepresentations about the instruction that would be offered at its campuses across the country. The Department found that the schools failed to train students in key elements of a cosmetology program, such as how to cut hair. It also found that Marinello left students without instructors for weeks or months at a time as part of a pattern of failing to provide the education it promised.

As a result, students would have found it extremely difficult to pass necessary state licensing tests and receive the promised return on their educational investment. Class-action lawsuits filed in Nevada andalleged that the school used salons as profit centers and exploited students as a source of unpaid labor.

According to officials, the Marinello findings stem primarily from the agency’s investigative work that began in 2015 and that resulted in the Department removing the school from the federal student aid programs.

 

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