FOR IMMEDIATE RELEASE:
August 27th, 2018
CONTACT: Natalia Abrams
Statement: Top consumer watchdog, Seth Frotman, resigns, blames Trump Administration for abandoning students and student loan borrowers
Today, Seth Frotman, the federal government’s top student loan consumer watchdog resigned. His letter of resignation blames the Trump administration for abandoning students and student loan borrowers at a time when exploding college costs and corporate malfeasance are harming Americans more than ever.
The letter, delivered to Consumer Financial Protection Bureau (CFPB) acting director Mick Mulvaney as well as leaders in Congress reads, “The challenges of student debt affect borrowers young and old, urban and rural, in professions ranging from infantrymen to clergymen. Tackling these challenges should know no ideology or political persuasion.”
He continues, “unfortunately, under your leadership, the Bureau has abandoned the very consumers it is tasked by Congress with protecting. Instead, you have used the Bureau to serve the wishes of the most powerful financial companies in America.”
Student Debt Crisis recognizes Frotman’s commitment to protecting students and student loan borrowers. Our supporters are grateful for his public service and dedication. As Student Loan Ombudsman at the CFPB, he worked tirelessly to hold big banks and student loan companies accountable. He has remained dedicated to the mission of advocating for America’s 45 million student loan borrowers.
“Despite major leadership changes and policy rollbacks, despite the shutting down of the Office of Students and Young Consumers; and despite working under an acting director that personally opposes efforts to protect consumers, Seth Frotman continued to use his position to ensure that Americans pursuing higher education were not taken-advantage of.”
“Even now, in his last moments as Student Loan Ombudsman, Frotman used the action to put the interests of student loan borrowers first. His resignation letter sends a strong message that demands accountability from an administration that is neglecting student loan borrowers and has abandoned solutions to the student debt crisis. Seth is a champion for all Americans and the Consumer Financial Protection Bureau will be worse off without him.
– Natalia Abrams, Executive Director ~ Student Debt Crisis
In the past 10 months, the CFPB’s top objectives were hijacked by the Trump administration and those bent on deregulating bad-acting student loan companies. Frotman led the office for student loan borrowers at a time when its leaders were working to completely destroy the Bureau’s core purpose.
Since its creation, the CFPB has recovered more than $750 million in funds for people who were defrauded by their lenders and servicers. The Bureau also took enforcement action against the worst actors in the industry, including Navient and Corinthian Colleges. Its key leaders are now resigning due to the administration’s harmful agenda and student loan borrowers will no longer have the federal advocates they once had.
It is vital that the Consumer Financial Protection Bureau return to its original principles. We urge Congress to combat the current administration’s attempts to dismantle consumer protection efforts by strengthening its ability to enforce the law, to remain independent from political and party pressures, and to hold bad actors accountable for harming consumers.
Over 41,000 Student Debt Crisis supporters took action to urge Congress to oppose any plan that diminishes the CFPB’s ability to protect student loan borrowers.