“Last week, the Education Department quietly informed the Consumer Financial Protection Bureau that it would stop sharing critical information on $1.3 trillion of federal student loans, ending a partnership that has let the CFPB sue loan companies and force others to change their practices in the nation’s second-largest household debt market. Several former high-ranking federal officials fear the directive signals a greater leniency toward loan companies trying to collect on debts, and perhaps a new effort by the Trump administration to undermine the bureau’s enforcement authority.”
Betsy DeVos has taken another step to gut protections for student loan borrowers. Last week, the Department of Education ended its partnership with the Consumer Financial Protection Bureau. In the past, the two agencies had worked together to crackdown on predatory debt collectors. These companies often use aggressive collection tactics, mislead borrowers about repayment options, and push more expensive payment plans. One of the nation's largest student debt collectors even admitted, “there is no expectation that the servicer will act in the interest of the consumer.”
Now, millions of Americans weighed down with student debt will have to fend for themselves. Meanwhile, on Wall Street the news boosted the shares of debt servicing companies. There you have it: the Trump administration has once again abandoned the American people in favor of corporate profits.
By Shahien Nasiripour
