Skip to main content

San Diego-Based Bridgepoint Agrees To Refund Student Loan Payments

Ashford University is pictured in San Diego in this undated photo.

Photo by Matthew Bowler

Above: Ashford University is pictured in San Diego in this undated photo.

San Diego-Based Bridgepoint Agrees To Refund Student Loan Payments

GUEST:

Megan Burks, reporter, KPBS News

The Consumer Financial Protection Bureau announced this week the San Diego-based for-profit college company Bridgepoint Education will pay $23.5 million to settle allegations that it used deceptive practices to get students to take out in-house student loans.

A consent order issued by the bureau Thursday alleges Bridgepoint, which operates Ashford University and University of the Rockies, misled students by telling them they could pay off their private student loans in $25-a-month payments. In many cases, their monthly bills were much higher.

By settling, Bridgepoint has not admitted or denied wrongdoing.

In a statement obtained by The San Diego Union-Tribune, Chief Executive Andrew Clark said the company did not deceive borrowers. A spokesperson for the company has not yet returned KPBS' request for comment.

Under the settlement, Bridgepoint will refund nearly $5 million in principal and interest payments on student loans. It must also cancel about $18.5 million in outstanding loan debt and pay an $8 million penalty to the feds.

The settlement is the latest in a federal crackdown on for-profit colleges aimed at reducing overall student loan debt. Last week ITT Technical Institute abruptly shuttered its campuses, including two in San Diego County, after the U.S. Department of Education blocked the college from enrolling students with federal financial aid. An accrediting agency found problems with the school's job placement and student retention rates.

RELATED: Community Colleges Roll Out Welcome Mat For Jilted ITT Tech Students

Bridgepoint is not expected to close. It is still eligible to accept federal financial aid and recent filings with the U.S. Securities and Exchange Commission show a healthy balance sheet, even with the settlement payout.

Want more KPBS news?
Find us on Twitter and Facebook, or sign up for our newsletters.

To view PDF documents, Download Acrobat Reader.