Bonamici, Porter Introduce Legislation to Protect Student Borrowers, Young Consumers from Unscrupulous Lenders

WASHINGTON, DC [12/08/23] – Today Congresswomen Suzanne Bonamici (D-OR) and Katie Porter (D-CA) introduced legislation to restore the Consumer Financial Protection Bureau's (CFPB) Office for Students and Young Consumers.

Before the Trump administration closed the Office for Students and Young Consumers in 2018, it helped return more than $750 million to students and student loan borrowers who had been cheated or misled by unscrupulous student loan companies and for-profit colleges. They assisted more than 60,000 borrowers who submitted complaints to the CFPB about the student loan industry. The Students and Young Consumers Empowerment Act will reopen the office and strengthen the CFPB’s ability to protect students, prevent fraud, and preserve the integrity of the student loan marketplace and access to affordable higher education.

"Students and young consumers who are seeking to invest in their education should not be cheated by unscrupulous companies or for-profit colleges," said Suzanne Bonamici, senior member of the Education and the Workforce Subcommittee on Higher Education and Workforce Development. "The Biden administration has taken many important steps to improve the student loan system and compensate borrowers and students who have been duped or defrauded. But we can do more. Restoring the Office for Students and Young Consumers will provide a needed resource at the CFPB and help create a better, fairer, and more transparent system.”

“When young people get cheated by student loan companies or for-profit colleges, they should have a partner in the federal government they can trust to get them justice,” said Katie Porter, a longtime consumer protection attorney. “A dedicated Office for Students and Young Consumers will prevent student loan borrowers from being overlooked and will be empowered to act on their behalf to crack down on fraudsters. I’m proud to work with Congresswoman Bonamici on this important legislation to hold bad actors accountable for harming our nation’s young people.”

Specifically, the Students and Young Consumers Empowerment Act:

• Establishes the position of the Assistant Director and Student Loan Borrower Advocate as head of a statutorily mandated Office for Students and Young Consumers (Office) charged with:
  • empowering students, young consumers, and their families to make better informed decisions regarding consumer financial products and services;
  • identifying new risks to consumers and referring cases for enforcement; and
  • making recommendations to Congress about how to protect young consumers;
• Empowers the Office to work with private and Federal student loan borrowers to resolve complaints against lenders, servicers, and debt collectors;
• Requires information sharing between the head of the Office and senior officials across the federal government to allow the Office to carry out its duties and effectively protect student loan borrowers;
• Gives the Office new tools to demand data from industry about risky practices, and requires annual reports about the student loan marketplace, campus banking, and risks to young consumers; and
• Provides Congress with new tools to hold CFPB accountable for the requirements in this Act.

A summary of the legislation can be found here, and the text of the legislation can be found here. It is co-sponsored by Rep. Rashida Tlaib (D-MI).

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