Statement from SBPC Executive Director Seth Frotman on the Congressional Inquiry into Trump Administration Obstruction and Industry Abuses

Lawmakers announce groundbreaking inquiry into abuses driving the student debt crisis

AUGUST 14, 2019 | WASHINGTON, DC — Student Borrower Protection Center Executive Director and former CFPB Student Loan Ombudsman Seth Frotman issued the following statement on the congressional inquiry announced yesterday into the Trump Administration’s failure to protect student loan borrowers, including obstruction of law enforcement officials by senior Trump Administration officials and abuses by the student loan servicing industry:

“The Trump Administration is engaging in an illegal, coordinated effort to shield the largest student loan companies as they cheat borrowers out of their rights. As our nation faces a student debt crisis, the federal officials charged with protecting borrowers are instead undermining law enforcement officials working to hold predatory companies accountable. Under the leadership of Chairs Waters, Scott, and Cummings, the House of Representatives is demanding answers from Secretary DeVos, CFPB Director Kraninger, and the corporate executives directly responsible for these abuses. Tens of millions of student loan borrowers deserve justice and I commend Congress for this critical work to protect borrowers.”

The press release from the House Education and Labor Committee announcing a joint inquiry by the committee, the House Committee on Financial Services and the House Committee on Oversight is available here, including document requests sent to the U.S. Department of Education, the Consumer Financial Protection Bureau, and the largest student loan servicers.

The House Financial Services Committee will hold a hearing on September 10, 2019 entitled “A $1.5 Trillion Crisis: Protecting Student Borrowers and Holding Student Loan Servicers Accountable.”

Earlier this month, SBPC and a coalition of consumer advocates issued a list of failures by CFPB Director Kathy Kraninger to protect student loan borrowers, including refusing to stand up to Secretary DeVos’s obstruction.