March 9th, 2017
CONTACT: Natalia Abrams

Statement on Department of Education Attempts to Block States from Enforcing Student Loan Protections

Student Debt Crisis strongly opposes the Department of Education’s memo that prohibits states from regulating predatory student loan servicing companies. The Department’s actions would effectively eliminate all consumer protections designed to help Americans harmed by student debt, despite the servicing industry’s long track record of fraud and abuse.

Billionaires Donald Trump and Betsy DeVos have done everything they can to reward these bad-acting student loan companies. First, the administration rolled back federal regulations. Now, the Department of Education argues that federal law preempts the rights of states to protect citizens from being ripped off by their student loan servicer. This interpretation would gut state protections that were designed to fill the void created by lack of federal oversight.

“States have a right to enact consumer protections that defend their residents from student loan abuses,” said executive director Natalia Abrams, “prohibiting local governments from creating their own safeguards eliminates the last line of defense for 45 million Americans struggling with student debt.”


“Ultimately, Besty DeVos’ Department of Education is erasing all levels of accountability – opening the door for loan servicers to take further advantage of students and borrowers. We echo the voices of our supporters, and others across the country, who continue to call for stronger regulations and greater accountability in a student loan industry that has run amuck.”

Abrams highlighted other policy rollbacks recently approved by the Betsy DeVos Department of Education. “In their first year, the current administration delayed debt-relief for students scammed by predatory for-profit colleges and rolled back policies that previously stopped student loan companies from charging huge fees to borrowers who fall behind on their payments.”


Student Debt Crisis is a nationwide advocacy group with over 1,000,000 supporters calling for fair student loan and higher education policies.

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