10.18.17

Senators Baldwin and Nelson Call on Department of Education to Act on Student Loan Debt Relief Scams

WASHINGTON, D.C. – Following the Federal Trade Commission’s (FTC) announcement of the first federal-state law enforcement initiative to crack down on student loan debt relief scams, U.S. Senators Tammy Baldwin (D-WI) and Bill Nelson (D-FL) continue to call for the Department of Education to also take action in addressing this growing problem.

In a letter last month, Baldwin and Nelson led a group of 12 senators in calling on Department of Education Secretary Betsy DeVos to take swift action in addressing the growing problem of student loan debt relief scams, citing the Department’s responsibility to ensure effective and streamlined student loan services.

“We write to request that your agency take swift action to address the growing problem of student loan debt relief scams,” wrote the senators. “These schemes are luring student loan borrowers into paying thousands of dollars in exorbitant and unnecessary fees for services that are available for free with false promises to reduce or forgive their debt. Most victims of these deceptive practices are quickly defrauded by the companies that promised to help them, and unknowingly become delinquent on their payments and default on their loans, miss communications with their servicers, and fall even deeper into debt. Given the terrible impact on student loan borrowers and their families, and the clear federal role in improving federal student loan servicing we strongly believe the U.S. Department of Education ("Department") and its contracted loan servicers should take new and more aggressive action to reduce the prevalence of these debt relief scams.”

Senators Patty Murray (D-WA), Dianne Feinstein (D-CA), Kirsten Gillibrand (D-NY), Chris Murphy (D-CT), Catherine Cortez Masto (D-NV), Ben Cardin (D-MD), Kamala Harris (D-CA), Dick Durbin (D-IL), Amy Klobuchar (D-MN), Al Franken (D-MN), Jack Reed (D-RI) and Elizabeth Warren (D-MA) also signed the letter.

A copy of the letter is available here