US Government Finally Forgives Billions in Debt of Students Who’ve Become Disabled

The move comes after a ProPublica investigation that documented how the government was making it hard for disabled borrowers to get their loans forgiven


The federal Department of Education said on Tuesday it would offer to write off $7.7 billion of student debt owed by disabled individuals, taking a big step to streamline a loan forgiveness program long plagued by bureaucratic delay and inefficiency.


Starting April 18, loan forgiveness letters will go out to approximately 387,000 borrowers who have been identified as totally and permanently disabled by the Social Security Administration, allowing them to sign and file a simplified application form to have their debt forgiven.


The move was enabled by changes in the department's regulations governing the loan forgiveness program, which resulted from a 2011 ProPublica investigation published in partnership with Columbia's Stabile Center for Investigative Journalism and the Center for Public Integrity.


Under federal law, borrowers who develop severe and lasting disabilities after taking out federal student loans are entitled to have their debts forgiven. As we noted in our investigation, the purpose of the rule was to spare former students who become disabled from a lifetime of ruined credit, garnished Social Security benefits, and spiraling debt.


But the investigation found that borrowers who become disabled faced such a high hurdle for proving their disability to the department 2014 and obstacles such as unclear rejection letters and lack of medical standards for proving disability 2014 that many simply gave up.


In one case, a borrower in a vegetative state was placed into default for failing to provide the department with income verification, according to an internal Department of Education Ombudsman Report that outlined problems with the program.


In another case documented in our February 2011 story, Tina Brooks, a former policewoman who had been severely injured during a training accident, could not get her $43,000 of student debt forgiven despite the fact that a Social Security judge had ruled she was fully disabled.


Internal reports showed the ombudsman had twice warned that the loan forgiveness program was flawed and needed to be reformed. But the Department of Education had ignored calls for reform from within and outside the agency.


That began to change after the story ran. Within a few weeks, the department forgave Brooks' student debt. The following year it proposed reforms which took effect in 2013 and allowed the Department to use the Social Security Administration's disability designation to qualify applicants for loan discharge.


That key reform is now enabling what the department hopes will be a "streamlined and more accurate process" for proactively identifying applicants who are eligible for student loan discharge, according to a statement.


"Too many eligible borrowers were falling through the cracks, unaware they were eligible for relief," said Education Undersecretary Ted Mitchell in a statement regarding the decision.

"Under the new process, we will notify potentially eligible borrowers about the benefit and guide them through steps needed to discharge their loans, helping thousands of borrowers. Americans with disabilities have a right to student loan relief," Mitchell said.


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India, US to deepen alliance for combating tax evasion
Washington : As nations across the globe are in hot pursuit of tax evaders and terror financing, India and the US have agreed to step up their joint work in this area, while Washington has extended its support for India's trillion-dollar infrastructure development needs.
Visiting Finance Minister Arun Jaitley and US Treasury Secretary Jacob J. Lew met here Thursday evening for the 6th Annual US-India Economic and Financial Partnership, which was formed in 2010, and released a joint statement, covering collaborations in areas ranging from regulation to money laundering.
"We are committed to continued collaboration and sharing of experience in tackling offshore tax evasion and avoidance, including joint tax audits and examination. We look forward to the competent authorities of the two countries engaging in bilateral dialogue to move forward," the statement said.
"We have enhanced our cooperation in tackling money laundering and combating the financing of terrorism through increased information sharing and cooperation, including a dialogue held recently in India," the statement said.
"We both agree on the importance of fighting illicit finance in all forms as an important means of tackling global terrorism."
On these fronts, the two governments have already forged an inter-governmental pact to share financial information under the Foreign Account Tax Compliance Act that. This act requires the US non-residents to share information on their financial assets and revenues outside the country once a year.
The dialogue under the partnership pact was held even as an Oxfam report said on Thursday that as many as top 50 US companies, including the likes of Apple, Walmart, General Electric, Microsoft, Google and Coca-Cola, have a whopping $1.4 trillion stashed in offshore tax havens.
The talks, held on the margins of the World Bank-International Monetary Fund Spring meetings here on Thursday -- which also included Federal Reserve Chair Janet Yellen and Reserve Bank of India Governor Raghuram Rajan -- also covered Infrastructure.
"We are working together to support India's National Investment and Infrastructure Fund to increase financing options for India's infrastructure growth. We look forward to continuing discussions in areas such as municipal finance under the future work of the Initiative," said the statement.
"The next meeting of the Investment Initiative will be in the US later in 2016."
The statement said effort will also continue under the US-India Investment Initiative of January 2015 for the two governments to work with the private sector on areas like policies and regulatory reforms, besides mobilising capital from domestic and foreign sources to build infrastructure and create jobs.
"We are encouraged with the developments that have taken place since the launch of the Economic and Financial Partnership and look forward to continued engagement in an effort to strengthen our relationship, our economies, and the global economy."
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.



Infosys net up 16 percent in Q4
Bengaluru : Infosys Ltd has posted a Rs.3,597 crore consolidated net profit for fourth quarter (January-March) of fiscal 2015-16, registering 16 percent year-on-year (YoY) growth, as per Indian accounting standards.
In a regulatory filing with the BSE on Friday, the IT bellwether said its consolidated revenue grew 23.4 percent YoY to Rs.16,550 crore in Q4.
Under the International Financial Reporting Standard (IFRS), net profit was up 7 percent YoY to $533 million and revenue increased 13.3 percent YoY to $2,446 million ($2.5 billion).
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.



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