Las Vegas Sun

March 28, 2024

Rep. Lee has hand in helping bilked students secure debt relief

Kendrick Harrison

Kendrick Harrison, U.S. Army veteran living in Las Vegas, says he was left in financial straits after his school, Argosy University, abruptly closed last year.

Kendrick Harrison didn’t have the money to pay his debt. And, yet, the creditors kept calling to collect.

A family man and U.S. Army veteran living in Las Vegas, he had enrolled at Argosy University to take online business courses when he returned from duty. His studies were going fine until the university started to keep the money from the military that was supposed to be transferred to him.

At the time the school fully shut down last year, he said they owed him $16,000. Argosy University, which was owned by a subsidiary of religious California nonprofit Dream Center, was a for-profit college with online degree options. Dream Center also owned the Art Institute of Las Vegas, which shut down in 2019.

“My family and I were left holding the stick, I guess, at the end of the day. We were evicted, my car was repossessed, my credit score was damaged in upwards of 100 points, which, actually, knocked me out of the running of even purchasing a house,” he said.

Democratic Rep. Susie Lee of Nevada recently introduced a House measure to help students facing situations similar to that of Harrison. The measure would stop Education Secretary Betsy Devos from instituting restrictions beginning July 1 to the Borrower Defense to Repayment Rule, which will make the process for claiming restitution from schools harder for students.

The borrower defense rule is meant to give students a means to fight back against universities found to have engaged in predatory policies — including Argosy — by offering relief from federal loans. The measure was passed Thursday and must now pass in the Senate.

“Basically, what this (rule) means is when these kids are defrauded by bad actors, predatory institutions, they should have some relief from the debt that they’ve taken out to attend those very institutions,” Lee said.

Harrison was blunt about the financial stress his time at Argosy caused. The money he received from the GI Bill was supposed to go to the school, with certain living expenses dispersed back to Harrison as a stipend. Harrison did not receive all his stipends.

“Three-and-a-half years ago when I moved into my home that I started renting … the property rental rate was at a such a lower amount,” he said. “I only paid $1,150 in rent back in 2016; now for that same place to rent … it’s going to cost me $1,700-$1,800.”

Click to enlarge photo

In this Nov. 2, 2018 file photo, U.S. Rep. Susie Lee, D-Nev., speaks in Las Vegas.

Harrison and his family of six children live in a friend’s guest house, which he said is better than the homeless shelter they previously used.

“I’ve been going to school for three and a half years, I haven’t got a raise, I haven’t got a pay increase, but the cost of living has gone up tremendously,” Harrison said. “On top of that, I have an eviction because of what they’ve done, so it makes it even harder for me to get a place. This is the cycle that my family and I have been in for the past year.”

Harrison said his experience with Argosy has led him to develop issues with trust at his new school, UNLV.

“It’s hard for me now to go to class and to trust the institution (and) I mean, UNLV is a great institution,” he said. “Trust me, after this incident, I have been looking. I’ve been making a list, checking it twice. I’ve been going through their records with a fine-tooth comb because I am determined not to get screwed again.”

The borrow defense rule was put in place to offer relief to students who might be left with a hefty bill from a school they only applied for after receiving misleading information — such as employment opportunities, transferability of credit and quality of the education.

The Trump administration has tried to make it harder for students to get restitution through the rule. Under DeVos’ proposed rule, students would have to file their claims within three years as opposed to six and find it harder to claim restitution due to carrying the responsibility to show proof their university intentionally tried to harm them.

“(DeVos) rewrote the borrower defense rule to make it almost impossible for defrauded students to get relief on their student loans,” Lee said on the House floor. “Even in cases where the schools clearly violated the law, the burden of proof on the defrauded student is so absurdly unrealistic, it would take a team of lawyers for the student to have a shot at proving intent and misconduct from the school.”

Devos’ changes are much more stringent than the rules in place during the Obama administration, and would put the onus for proving intent on students. In an August statement, she touted the money the change would save taxpayers and said it would hold schools accountable.

“I called for this regulatory reset more than two years ago, as it became clear the old rules just weren’t working. I want to thank all those who provided thoughtful feedback during the process,” Devos said in the statement. “We made substantive changes to our proposed rule based on your input. We believe this final rule corrects the wrongs of the 2016 rule through common sense and carefully crafted reforms that hold colleges and universities accountable and treat students and taxpayers fairly.”

The change in regard to proving intent struck Lee as particularly egregious.

“It means that these young kids who are already sitting on debt … they (either) don’t have a degree or have a useless degree, now they’re going to have to go hire an attorney,” Lee said.

Lee said there are about 3,100 pending borrower defense claims in Nevada with institutions such as Brightwood College and the Art Institute shuttering in the past 10 years. In total, Lee says 30 institutions have closed.

To stop DeVos’ reworking of the rules, the Senate must also pass an act opposing it. Democratic Illinois Sen. Dick Durbin is leading that effort.

“This is a criminal act with victims associated with it,” Harrison said. “There should be restitution and there should criminality associated with it. In any other sector if you rob any institution or any group of people ... guess what? You’re going to jail, buddy.”