Eighteen states and the District of Columbia on Thursday filed suit against the Department of Education and its secretary, Betsy DeVos, for “abandoning” protections for student loan borrowers established in the Obama administration and originally scheduled to take effect on July 1.
The so-called Borrower Defense Rule, completed by the Obama administration after years of work, entitled student loan borrowers to pursue loan forgiveness from schools found to have defrauded them. It also limited the ability of for-profit colleges to force students to sign arbitration agreements and class action waivers — thereby preventing them from taking cases against the schools to court.
“Since day one, Secretary DeVos has sided with for-profit school executives against students and families drowning in unaffordable student loans,” Massachusetts Attorney General Maura Healey wrote in a statement accompanying the lawsuit. “Her decision to cancel vital protections for students and taxpayers is a betrayal of her office’s responsibility and a violation of federal law. We call on Secretary DeVos and the U.S. Department of Education to restore these rules immediately.”
Healy noted that DeVos announced a review of the rule in May following a lawsuit against the Department of Education to stop the rule, from a group of for-profit colleges. DeVos announced she would delay the rule in June, citing “pending litigation challenging the BDR regulations” and what she described as an Obama administration rule-making effort that “missed an opportunity to get it right.”
The attorneys general filing suit against DeVos don’t buy it.
“[B]oth the language of the Delay Notice and the circumstances of its announcement belie this rationale and make clear that the Department’s reference to the pending litigation is a mere pretext for repealing the Rule and replacing it with a new rule that will remove or dilute,” they alleged in the suit.
In fact, Politico reported in June, citing internal documents that it had obtained, that DeVos cited the lawsuit as grounds to delay the rule’s implementation only after considering other rationales.
The rule largely took shape in the shadow of Corinthian Colleges, Inc., a for-profit group that declared collapsed 2015, leaving behind a massive, nationwide trail of defrauded students (and student loan borrowers).
In June, a similar wave of attorneys general urged DeVos to provide debt relief to students defrauded by Corinthians, signing onto a letter penned by Illinois Attorney General Lisa Madigan.
“We urge the Department to discharge these loans, consistent with your statements before a House appropriations subcommittee in May, and to do so swiftly,” the attorneys general wrote. “There are already findings that these student borrowers have been defrauded, and every day that passes causes them further harm. The Department should act immediately to finalize the discharge of these loans.”
Read the complaint below:
A Trumpster putting profit over education? Didn’t see that one coming.
DeVos responds by banning law schools.
Are these AGs crazy? You cannot sue Betsy DeVos. Her brother has killed people at a traffic stop for less.
NOTE: Edited later for dramatic effect.
Most excellent. Keep at it AG’s.
Can you spell Violation of Federal Law Betsy? Sure you can. It’s with a V…