Borrowers claiming for-profit college fraud face big holdup

— Tens of thousands of former students who say they were swindled by for-profit colleges are being left in limbo as the Trump administration delays action on requests for loan forgiveness, according to court documents.

The Education Department is sitting on more than 65,000 unapproved claims as it rewrites Obama-era rules that sought to better protect students.

The rewrite had been sought by industry.

The for-profit college industry has found an ally in President Donald Trump, who earlier this year paid $25 million to settle charges his Trump University misled customers.

And it’s yet another example of the Trump administration hiring officials to oversee the industries where they had worked previously.

In August, Education Secretary Betsy DeVos picked Julian Schmoke Jr., a former associate dean at DeVry University, as head of the department’s enforcement unit.

She also tapped a top aide to Florida’s attorney general who was involved in the decision not to pursue legal action against Trump University to serve as the agency’s top lawyer.

More than 2,000 requests for loan forgiveness are pending from DeVry students.

The Obama rules would have forbidden schools from forcing students to sign agreements that waived their right to sue.

Defrauded students would have faced a quicker path to getting their loans erased, and schools, not taxpayers, could have been held responsible for the costs.

Now, in a filing in federal court in California, acting Undersecretary James Manning says the department will need up to six months to decide the case of a former student at the now-defunct Corinthian Colleges and other cases like hers.