Beshear Secures $1.7 Million in Loan Debt Relief for nearly 700 Students who Attended Spencerian Colleges

Students receive loan forgiveness, have wage garnishments lifted, collection lawsuits dismissed

FRANKFORT, KY. (Jan. 4, 2019) – Attorney General Andy Beshear today announced a consumer protection settlement benefiting nearly 700 students in Kentucky and Southern Indiana who attended one of the state’s for-profit colleges, Spencerian.

Under the terms of the settlement, Sullivan University, which owned Spencerian, has agreed to forgive more than $1.7 million in private loan debt and provide other benefits to 668 students who attended Spencerian and received an institutional student loan between Jan. 1, 2007, through Dec. 31, 2011.

Beshear’s office finalized the settlement with Sullivan Jan. 3, 2019.

The nearly 700 students who received Career Education Fund or CEF loans to attend Spencerian had the balance of their loans forgiven as of Sept. 21, 2018. The settlement outlines in more detail the amounts of debt forgiveness for the group of students.

“My office is pleased that Sullivan has agreed to resolve this matter by forgiving nearly $2 million in student loans and agreeing to help repair their credit and dismiss any collection lawsuits against these students,” Beshear said. “I want to thank former AG Jack Conway for filing the lawsuit, and at a time when our young Kentuckians face unprecedented student debt, I am pleased we secured them real relief.”

Spencerian had campuses in Louisville and Lexington but after a merger in June 2018, the Lexington campus closed and the Louisville campus now operates as part of the regionally accredited Sullivan University. Spencerian College ceased enrolling students June 22, 2018.

The case by the Office of the Attorney General was originally filed in 2013, alleging that Spencerian misrepresented the graduate employment success of its students both on its website and in printed advertisements dating back to 2007.

The loans being forgiven are private CEF loans that students obtained from Spencerian to help cover the gap between the cost of tuition and financial aid provided by the Department of Education. The settlement does not affect students’ federal loans that are under the jurisdiction of the U.S. Department of Education.

Other terms of the settlement for students include:

  • Sullivan will cease all collection of CEF loans. Any third-party collectors will cease efforts to collect on the loans; any wage garnishments related to the loans will be lifted; and any collection lawsuits for defaulted CEF loans will be dismissed.
  • Sullivan will direct credit-reporting agencies to remove any negative information reported about a student with one of the affected loans. Beshear said this may help improve the credit rating of students who were behind on payments or had made late payments.
  • Sullivan University will provide any student with a CEF loan affected by this settlement a free transcript upon request for a period of three years from the date of the settlement, even if the student has previously requested and been denied a transcript. Requests can be made at

Beshear said his office is sending letters to the 668 students explaining the terms of the settlement. Students my contact Sullivan University directly by reaching out to Melissa Higgins at

Beshear said he is committed to holding for-profit colleges accountable in Kentucky and is working to help defrauded students. He advises any students who believe a private college has misled them or who have been a victim of fraudulent debt relief services to contact his office by phone, 502-696-5300, or by completing a complaint form.