News  AG Healey Commends Congressional Effort to Reject U.S. Department of Education Rule That Would Hurt Students

Boston — Attorney General Maura Healey today led a coalition of states in supporting a Congressional effort to reject a final rule by the U.S. Department of Education that fails to protect students and taxpayers from the misconduct of unscrupulous schools.

In a letter to Congress, the attorneys general commended efforts to reject the U.S. Department of Education’s 2019 Borrower Defense Rule pursuant to a resolution of disapproval under the Congressional Review Act.

“As an office that works everyday with students who have been cheated by predatory schools, we know the devastating effects that this rule will have on the lives of families in Massachusetts,” AG Healey said. “We commend our Congressional leaders for this action and urge them to continue working with us to get students the relief they deserve.”

“The Trump Administration’s Borrower Defense rule would slam the door on loan cancellation for students cheated by greedy for-profit colleges,” said Senator Elizabeth Warren. “I’m standing with students by cosponsoring this resolution to overturn Secretary DeVos’ Borrower Defense rule and by fighting alongside Attorney General Maura Healey to make sure every defrauded Massachusetts student gets the relief they deserve.”

According to the letter, the final rule provides no realistic prospect for borrowers to discharge their loans when they have been defrauded by predatory for-profit schools, and it eliminates financial responsibility requirements for those same institutions.

“If this rule goes into effect, the result will be disastrous for students while providing a windfall to abusive schools,” the letter states.

The Department’s new rule would rescind and replace its comprehensive 2016 Borrower Defense Rule, which involved a thorough rulemaking process addressing borrower defense and financial responsibility, in which the views of numerous schools, stakeholders, and public commenters were involved. The 2016 Borrower Defense Rule provided defrauded borrowers with a transparent process to seek debt relief and protected taxpayers by holding schools accountable that engage in misconduct.

According to the letter, the Department’s new rule provides an unworkable process for defrauded students to obtain loan relief and will do nothing to deter and hold accountable schools that cheat their students. Instead of ensuring that borrowers are not bearing the costs of institutional misconduct, the Department’s new rule empowers predatory for-profit schools and cuts off relief to victimized students.

AG Healey has established herself as a national leader on behalf of distressed student borrowers, committed to challenging the illegal policies of Education Secretary Betsy DeVos and the U.S. Department of Education. In July 2017, AG Healey, along with 19 other state attorneys general, brought a lawsuit challenging the Department’s failure to implement the 2016 Borrower Defense Rule. In October 2018, a federal judge rejected a challenge to the 2016 Borrower Defense Rule, ordering its immediate implementation for students nationwide, resulting in approximately $381 million in automatic loan discharges for students whose schools closed on or after November 1, 2013.

Other actions by AG Healey include uncovering widespread misconduct at Education Management Corporation, which includes the New England Institute of Art in Brookline, ITT Technical Institute, Corinthian Colleges, American Career Institute and others, and securing relief for thousands of defrauded student borrowers.

Joining AG Healey in today’s letter are the attorneys general of California, Delaware, Hawaii, Illinois, Iowa, Maine, Maryland, Michigan, Minnesota, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Vermont, Virginia, Washington, and the District of Columbia.

Massachusetts borrowers who are looking for student loan help or information should visit the AG’s Student Loan Assistance page or call the Student Loan Assistance Unit Hotline at 1-888-830-6277.