Bonamici Confronts Sec. DeVos About Failure to Protect Defrauded Students
WASHINGTON, DC [12/12/19] – Today Congresswoman Suzanne Bonamici (D-OR) pressed Education Secretary Betsy DeVos about her decision to continue to demand loan repayment from students who were defrauded by for-profit institutions.
“The Secretary’s answers about the Education Department’s failure to protect students from deceptive for-profit institutions were deeply unsatisfactory, as is her plan to provide only partial relief to some borrowers,” Congresswoman Suzanne Bonamici said after the hearing. “It is not justice if students who were defrauded are denied full student loan forgiveness. The actions of Secretary DeVos are contrary to the Education Department’s mission, which is to help students and foster educational excellence. I will continue my oversight responsibility to hold her accountable and make sure students receive a quality education.”
Video of Bonaimci’s questions at the hearing can be found here.
Bonamici noted that hundreds of thousands of students, including thousands in Oregon, were left with burdensome loans and useless degrees after the collapse of Corinthian Colleges and other for-profit institutions that engaged in deceptive practices. The Department of Education has repeatedly delayed implementation of the Borrower Defense rule, and just recently instituted a new formula for processing Borrower Defense claims that will result in loan forgiveness for only a fraction of borrowers.
It also violated a court order by illegally demanding repayment from Corinthian borrowers. The Department originally reported seeking repayment from more than 16,000 Corinthian borrowers, but we now know that this number is 45,000.
“I’m a former consumer protection lawyer for the Federal Trade Commission, and I know fraud when I see it,” Bonamici said during the hearing. “These students were misled and cheated. And the fact that some of them may be making money doesn’t mean they weren’t defrauded. If someone went into one of these programs hoping to become a nurse, for example, and now they’re selling clothes at a department store, it doesn’t mean that they weren’t defrauded.
“I hope you can put yourself in the shoes of some of these borrowers. I know it’s challenging. They went to try to find a better life for themselves and instead of getting a good education they got collection notices and wage garnishments.”
When Bonamici questioned DeVos about how many times the Department illegally billed borrowers who were applying for Borrower Defense in violation of a court order, the Secretary failed to provide specifics.
Congresswoman Bonamici is an outspoken advocate for student loan borrowers and has led efforts to protect students and taxpayers from predatory for-profit colleges. She has supported the gainful employment and borrower defense rules, which are aimed at reining in predatory for-profit colleges, and has spoken out following efforts by this Department to weaken these and other consumer protections for borrowers.