HOW YOU CAN COMMENT:
The comment page should be available by tomorrow when the proposed rules hit the federal register;
you can find it by searching at https://www.regulations.gov/
for RIN 1840-AD26;
Docket ID ED-2018-OPE-0027
There will be a 30 day comment period from the date it is posted in the federal register.
National Consumer Law Center Contacts: Abby Shafroth (email@example.com) or Jan Kruse (firstname.lastname@example.org); (617) 542-8010
Education Department Proposes New Rules
that Would Make it Much Harder for Students Harmed by For-Profit Schools to Get Loan Relief
Boston - Today, the U.S. Department of Education proposed new rules, replacing 2016 rules, that would make it much harder for students who are harmed by illegal school conduct or closures to get relief from their federal student loans or to hold schools accountable for illegal conduct. The Department proposes to severely restrict access both to “borrower defense” loan relief for students cheated by predatory schools that used illegal enrollment tactics and to loan relief for students whose schools closed before they completed their education.
“The federal student loan system is supposed to promote economic mobility and provide a ladder to a better future for low-income Americans,” said National Consumer Law Center attorney Abby Shafroth. “But for too many Americans it has done the opposite—putting targets on low-income, financial aid eligible students and veterans who are recruited by predatory institutions focused on growth and profit rather than on education and career training. It doesn’t have to be this way. The Department can and should apply rules that deter schools from lying to students to get them to enroll and that ensure students who were taken advantage of have real access to relief.”
Troublingly, the Department announced that it is considering severely restricting access to relief for student borrowers who are not in default. It is even considering refusing to allow students who are not in default to apply for borrower defense relief based on their school’s illegal conduct. Either alternative would unfairly punish borrowers who manage to stay out of default—and may even encourage default. The new rules would also narrow the grounds for federal student loan relief and eliminate the process to provide relief to groups of students who were subject to widespread misconduct or fraud. It would require students to submit more evidence (which borrowers often don’t have access to) and prove more difficult facts (such as what the school knew when providing false information). It would create a lopsided process that gives schools, but not students, the opportunity to respond to all the evidence and appeal adverse decisions. Additionally, the rule would make it harder for students to hold schools directly accountable for their illegal conduct by allowing schools to use forced arbitration clauses and class action bans to deprive students of their constitutional right to bring claims to an impartial judge or jury.
Moreover, despite recent widespread school closures that have left students with huge debts and no degree, the Department’s proposal would severely restrict federal student loan relief to students harmed by school closures. Its proposal would render students ineligible for closed school relief so long as their school provides an option to complete their program at a different school (as closing schools are generally already legally required to do), and would axe a 2016 rule that would have automatically discharged loans for eligible borrowers whose schools closed.
The Department has refused to implement borrower defense rules finalized in 2016 and plans to apply these new rules instead. Secretary of Education Betsy DeVos characterized the 2016 rules as making it too easy for student loan borrowers to get relief. The Department’s summary of the new rules states that they are designed to address concerns expressed by a for-profit school industry trade group and other industry representatives that the 2016 rules would impose financial liabilities that might imperil the viability of some schools. The proposal reflects an ongoing shift to protecting the multi-billion dollar for-profit education industry at the expense of students, and comes at a time that concerns about conflicts of interest have been raised about the role of former for-profit school executives hired by the Department.
Shafroth, a staff attorney for the National Consumer Law Center’s Student Loan Borrower Assistance Project, participated as a representative for legal aid organizations in rulemaking meetings held by the Department of Education in Washington, D.C. that preceded this proposed rule. Shafroth and other representatives for students, veterans, and low-income borrowers made numerous suggestions to the Department to ensure that the rule would provide student borrowers reasonable access to relief, but those suggestions were not included in the proposed rule.
“If these proposed rules are implemented, schools will continue to break the law and harm students with impunity, and student borrowers will continue to pay the price,” said Shafroth. “We urge the Department of Education to promptly implement the 2016 rules and to use this rulemaking to make it easier, not harder for students to get relief.
We also urge students and the people who care about them to send comments to the Department of Education telling it to put students and taxpayers first over predatory schools.”
Related NCLC Resources
Issue Brief: The Borrower Defense Rule protects students and taxpayers against fraud and abuse in higher education. (January 2017)
Comments of NCLC to the Department of Education Re: Borrower Defense Rule Delay and Intent to Establish Negotiated Rulemaking Committee (July 12, 2017)
Comments of NCLC and 16 other legal aid groups to the Department of Education re: Proposed regulations on borrower defenses and use of forced arbitration by schools in the Direct Loan Program, and proposed amendments to closed school and false certification discharge regulations. (August 1, 2016)
Blog: Who is the Department of Education Looking Out For? Another Delay of Student Protections Follows a String of Actions Protecting Industry Profits Over Students
Further Information on school-related cancellation of federal student loan debt.
US Ed Department wants to protect Trump U. Type Scam Schools instead of Ripped-Off Student Loan Borrowers
This is one of the most frequent and difficult problems I run into - calls from people who are shocked to see their paycheck reduced by a wage garnishment or who are suddenly bouncing checks and getting hit with overdraft fees for debits and failed payment fees because their bank accounts were garnished ...
This problem is why you should NEVER ignore a demand letter or a lawsuit -- the problem you cause yourself when you do is always exponentially larger and more expensive to solve than the one you started with.
Just because they are claiming you owe them doesn't mean you do (or, "Why you should call a lawyer if you have debt problems")
The Norfolk, VA paper has an interesting story that again demonstrates that just because someone shoves papers at you and claims you owe them money, it doesn't necessarily mean that you do. You might owe SOMEBODY something, but it's vital that you pay only the true creditor if you pay the debt -- because the true creditor's claims against you aren't wiped out by your payment to a scammer like this.
Note the ways to tell this is phony -- the "Noreply" email is misspelled, and the "simply call us at" phone number is bogus.
The most important tip, though, is to ALWAYS look at the sender id: email@example.com is NOT Netflix.
Legit businesses do NOT send this kind of thing.
If you were to click on those links, you'd be taken to a very convincing phony website that would collect your attempts to log in, which would capture your actual netflix login and username.
It helps that I don't have a Netflix account, but it's important to recognize all spearfishing attacks.
WOW. This FOX affiliate's "Reality Check" is an amazingly good piece of local TV journalism. WELL WORTH A WATCH.
Please share the video at the link with as many people as you can. Until everyday people realize just how badly the justice system has been privatized, corrupted, and turned against us, the real people, businesses will keep getting away with using arbitration to cover up their crimes and they will continue pouring money into campaigns to lock in their unfair dispute resolution scheme, where they get to use the power of the courts against you, but not the other way around.
Popular outrage is the only antidote. We have to start defeating any candidate for federal office who won't make fixing this mess a top priority.
"In a decision just two days ago, a federal judge appointed by George W. Bush felt compelled by U.S. Supreme Court decisions to enforce an arbitration clause even though the judge noted that
(a) the court did not believe that the plaintiffs ever believed they were signing away their right to bring a lawsuit;
(b) enforcing the clause would “undermine effective enforcement of federal antitrust laws”; and
(c) enforcing the clause after the defendant first had decided to litigate in court was “inefficient and wasteful.”
The court concluded that in this area of law, “common sense plays no role.”
Here’s a blog post about the case, with link to the decision:
This is a true poster child of arbitration abuse, really highlighting just how unfair the law has gotten under the current U.S. Supreme Court’s decisions. If people will read this decision, they may well get a sense of just how out of whack the law has gotten in this area."
Saw a great comment today by a lawyer who is struggling hard to solve a very difficult (and, now, expensive) estate administration problem involving title to real property.
The problem was created by the now-deceased parents of his clients; those parents probably saved all of a few hundred bucks on lawyer fees by doing their own estate planning.
The lawyer's comment:
"You don't always get what you pay for, but you seldom get what you don't pay for."
Oregon Adds Statewide Abuse Reporting Line:
Today we are happy to announce that Oregon has added another option for reporting suspected abuse of children and vulnerable adults. All our regular local hotline and reporting numbers will continue to take reports as usual, but we have added a single statewide number that provides another way to make these important reports. Oregon's abuse reporting hotline for children and adults, (855) 503-SAFE [855-503-7233], is up and running, and it provides callers with the ability to report suspected child abuse, elder abuse, abuse of people with physical or developmental disabilities, and abuse of people with mental illness or those experiencing a mental health crisis.
Callers will be directed that if the report is an emergency requiring immediate attention, to hang up and dial 911. If it is not an emergency, then callers will work through a simple phone tree to ensure their report gets to the right place for response, based on zip code and characteristics of the person they are calling about. Calls can be answered in English or Spanish. Once the calls are routed through the phone tree, they will be directed to local DHS or county offices for Child Protective Services and Adult Protective Services, County Developmental Disability Programs (CDDP) or County Mental Health Programs (CMHP) for response. Not all areas of the state will have a live person to take reports after hours, and some locations will provide voicemail reporting options.
All local hotline and reporting numbers will continue to take reports as usual, and the new line adds a single call option for those who want to use it. Oregon's abuse reporting hotline for children and adults is the result of two legislative workgroups, one on child welfare and one on elder abuse, which recommended a single hotline option to simplify reporting for Oregonians who are not familiar with the abuse reporting process. Mandatory reporters are often well aware of local reporting and hotlines and are responsible for most of the reports we receive. Citizens who may only make one or two calls in their lifetimes can be overwhelmed by the seeming complexity of agencies and numbers from which to choose.
(855) 503-SAFE [855-503-7233] will solve that problem by providing a single phone number anyone can call from any community in Oregon!
John Gear is a Salem attorney in solo practice