Thursday, July 6, 2017

18 States Sue Betsy DeVos Over Student Loan Protections - The New York Times

18 States Sue Betsy DeVos Over Student Loan Protections - The New York Times:

18 States Sue Betsy DeVos Over Student Loan Protections



Democratic attorneys general from 18 states and the District of Columbia filed a lawsuit on Thursday against the Education Department and its secretary, Betsy DeVos, challenging the department’s move last month to freeze new rules for erasing the federal loan debt of student borrowers who were cheated by colleges that acted fraudulently.
The rules, known as borrower defense, were finalized in October by the Obama administration after years of negotiation and review, and they had been scheduled to take effect on July 1. But after President Trump took office, Ms. DeVos paused the planned changes, citing a federal lawsuit filed in May by an association of for-profit colleges in California that is seeking to block the rules.
Ms. DeVos also criticized the rules, calling them “a muddled process that’s unfair to students and schools,” and she said she would establish a new rule-making committee to reconsider the matter from scratch.
In their lawsuit, filed in Federal District Court in Washington, the states called the agency’s rationale for the delay — the California lawsuit — a “mere pretext” for repealing and replacing rules that had already been finalized. The states are seeking to have the rules restored.
“Since day one, Secretary DeVos has sided with for-profit school executives against students and families drowning in unaffordable student loans,” said Maura Healey, the Massachusetts attorney general, who led the multistate coalition. “Her decision to cancel vital protections for students and taxpayers is a betrayal of her office’s responsibility and a violation of federal law.”
A spokeswoman for the Education Department declined to comment directly after the lawsuit was filed, saying that the department’s lawyers were reviewing it.
Also on Thursday, two student borrowers sued the Education Department in the same federal court over the delayed rules.
The students both attended the New England Institute of Art in Brookline, Mass., a for-profit school that stopped enrolling new students in 2015. Its parent company, Education Management Corporation, agreed that year to pay $95 million to settle a government lawsuit charging the company with making illegal payments to recruiters.18 States Sue Betsy DeVos Over Student Loan Protections - The New York Times:

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