$238 million worth of loans held by students enrolled at Marinello beauty schools to be discharged

Students who were left in the lurch when Marinello Schools of Beauty closed will have their student loans discharged, the Department of Education announced Thursday.

The discharge of 28,000 loans, totaling approximately $238 million, is the first time the Biden-Harris Administration has discharged debt of a group of borrowers based on borrower defense findings, DOE officials said. The loans that will be discharged belonged to students who enrolled in the schools from 2009 until they closed in February of 2016.

Hundreds of borrower defense claims had already been approved, but the group discharge will provide relief to more borrowers, including those who had not applied for borrower defense, according to the DOE.

"Marinello preyed on students who dreamed of careers in the beauty industry, misled them about the quality of their programs, and left them buried in unaffordable debt they could not repay," U.S. Secretary of Education Miguel Cardona said in a statement. "Today's announcement will streamline access to debt relief for thousands of borrowers caught up in Marinello's lies."

A DOE investigation found that the operators of the Marinello schools engaged in pervasive and widespread misconduct that negatively affected all borrowers who enrolled during the covered time period. Marinello failed to train students in key elements of a cosmetology program, such as how to cut hair, and also left students without instructors for weeks or months at a time as part of a pattern of failing to provide the education promised, DOE officials said.

Due to the lackluster cosmetology training, students "found it extremely difficult to pass state licensing tests and receive the promised return on their educational investment," DOE officials said. And not only did Marinello fail to teach its students, the DOE says class-action lawsuits filed in Nevada and California claimed Marinello used its training salons as profit centers and exploited students as a source of unpaid labor.

Before it closed, Marinello was owned by B&H Education and had campuses in Los Angeles, Burbank, Moreno Valley, Sacramento, and in Las Vegas. Marinello also had campuses in Connecticut, Kansas, Massachusetts, and Utah.