In An Amicus Curiae Brief In AFT V. MOHELA, Missouri AG Claims MOHELA Can Never Be Held Accountable In Federal Court For Cheating Borrowers
September 26, 2024 | WASHINGTON, D.C. — Missouri Attorney General (AG) Andrew Bailey filed an amicus curiae brief in federal court in AFT v. MOHELA, supporting the scandal-plagued financial services firm MOHELA. In its brief, the Missouri AG takes the legal position that MOHELA can never be held accountable for cheating borrowers because of its special status as a creature of the State of Missouri.
In response, AFT President Randi Weingarten issued the following statement:
MOHELA has hurt borrowers and instead of admitting accountability and trying to fix the problem, simply waves the issues away. Now, an Attorney General who’s sworn to protect the people, swoops in to shamelessly shill for a corporation and its profits. An elected official whose job it is to uphold the law seems to think that MOHELA is above it.
In response, Student Borrower Protection Center (SBPC) executive director Mike Pierce issued the following statement:
For the first time, the Missouri Attorney General is saying the quiet part out loud: he believes that MOHELA is above the law. This right-wing propaganda argues that no matter how many people MOHELA hurts or how many times MOHELA fails, there will never be justice for borrowers in any court anywhere in America.
AFT v. MOHELA alleges that MOHELA— a Missouri state-chartered private financial firm— cheated millions of student loan borrowers across the country while mismanaging a contract with the U.S. Department of Education to administer borrowers’ federal student loan accounts. MOHELA was created by the State of Missouri decades ago to make student loans and college scholarships to Missouri families. Instead of pursuing its mission, MOHELA has cut deals with big banks, tech companies, and the federal government to collect on loans in every state across the country. It is now one of the largest financial services companies in the country.
If adopted, the Missouri AG’s interpretation of the law would be a boon to big corporations from Wall Street to Silicon Valley—companies that could “rent-a-state-agency” to avoid accountability for unlawful debt collection and other harmful financial services practices.
###
About the AFT
The AFT represents 1.8 million pre-K through 12th-grade teachers; paraprofessionals and other school-related personnel; higher education faculty and professional staff; federal, state and local government employees; nurses and healthcare workers; and early childhood educators.
Learn more at aft.org or follow AFT on Twitter @AFTunion.
About Student Borrower Protection Center
Student Borrower Protection Center (SBPC) is a nonprofit organization focused on eliminating the burden of student debt for millions of Americans. We engage in advocacy, policymaking, and litigation strategy to rein in industry abuses, protect borrowers’ rights, and advance racial and economic justice.
Learn more at protectborrowers.org or follow SBPC on Twitter @theSBPC.