For a whole year, a Chilean artist using the name Fried Potatoes (Papas Fritas) planned his revenge. Saying he was collecting material for an art project, the 31-year-old visual artist sneaked into a vault at a notorious private, run-for-profit university and quietly removed tuition contracts.

Fried Potatoes – whose real name is Francisco Tapia – then burned the documents, rendering it nearly impossible for the Universidad del Mar to call in its debt – which he claimed was worth as much as $500m (£297m). “It’s over. You are all free of debt,” he said in a five-minute video released earlier this month. Speaking to former students, he added: “You don’t have to pay a penny.”

Tapia’s move is just the most radical of a three-year campaign by students and children to demand free, improved public education. With monthly marches– and four former student leaders elected to parliament – the students have built a potent citizen’s movement rarely seen in post-Pinochet Chile.

This week, they claimed their biggest victory so far when the president, Michelle Bachelet, outlined a multibillion-dollar package of educational reforms and invesment. “Chile needs and the people have clamoured for this reform, which must transform quality education into a right,” Bachelet said at a bill-signing ceremony. Her proposals include an end to state subsidies to for-profit universities and schools, and – potentially – the introduction of free university education for all. While Bachelet spoke, students outside the congressional hall scattered ashes from the burned Universidad del Mar documents in symbolic protest against for-profit educational scams.

The ashes have since been converted into a mobile art exhibit built into the sides of a Volkswagen camper van. The back window of the van holds a video screen so that Tapia’s message can be played to crowds of curious onlookers.

The van, laden with ash, has toured the streets of Santiago and Valparaiso, and even went on display at the GAM – a prominent Santiago art gallery and cultural centre. When Chilean detectives, wearing white body suits, attempted to confiscate the fine grey dust as evidence, they too were incorporated into the exhibit’s PR blitz and listed as “media partners”.

According to government investigators, the Universidad del Mar, in the swanky seaside resort of Renaca, was less a university than a money laundering operation. The university was shut last year, accreditations stripped away and thousands of students left with half a diploma – but who still found themselves lumbered with outstanding debts.

Lawyers say that Tapia’s destruction of the files does not technically rescind the debt, but it does make it extremely difficult to prove the debt exists. Only by formally testifying in court and acknowledging the debt would students now be forced to pay, said Mauricio Daza, a lawyer.

Daza also argued that the debts were of questionable legality even before Fried Potatoes destroyed them. “These debts are product of a fraud by the owners of the university over a long period of time,” said Daza. “They pretended to have a non-profit [university] but really it was all a cover-up for getting money from the students and the state and transferring those resources into the pockets of the university owners.”

Chilean students brought up the accusations of for-profit education schemes during huge street protests in 2011. As hundreds of universities and high schools were seized and occupied by teenage students, legislators began to investigate the charges. Eventually the students were proven right, university leaders were jailed and institutions shut down.

Tapia said his plan was hatched after reading press accounts that Universidad del Mar students were being forced to pay debt even after the university was shut down.

In a statement delivered to a Chilean court, Tapia defended his action. He claimed to have smuggled the documents to Santiago, where he began to investigate the credit files, case-by-case, student-by-student. By day Tapia would investigate the financial situation and life struggle of a single student. Then in the evening, he would destroy the documents related to that particular debt. “Every night, like a ritual, I burned the documents that detailed the debt.”

A university spokesman confirmed the documents had been stolen but refused to quantify how much the papers were worth.

Former Universidad del Mar students have celebrated the unorthodox protest. “This is spectacular, this is the only victory we have had in economic terms,” said Raul Soto, a spokesman for the former students. “This gives us the peace of mind that we are not going to still be in debt to Universidad del Mar.”