Press Releases
08/02/2021
Attorney General Tong Supports Protections for Student Borrowers
(Hartford, CT) -- Attorney General William Tong joined a multistate amicus brief advocating for the rights of federal student loan borrowers. The brief, which was filed in the U.S. Court of Appeals for the Second Circuit, supports the New York Legal Assistance Group's (NYLAG) lawsuit challenging action taken by the Trump administration's Department of Education (ED) that unlawfully repealed and replaced federal “borrower defense” regulations.Borrower defense is the process by which students can seek relief from their federal student loans when they have been defrauded by their school. The Trump administration scrapped previous borrower defense regulations that meaningfully protected students from deceitful practices with new regulations that favor predatory for-profit schools and all but shut the door on students seeking debt relief. In its lawsuit, NYLAG, a legal aid organization that is represented by the Project on Predatory Student Lending and Public Citizen Litigation Group, argues that the Trump administration’s 2019 Borrower Defense Rule is arbitrary and capricious and must be stricken. Attorney General Tong is pursuing the same claim as part of a multistate coalition in a lawsuit brought in the Northern District of California.
“This Trump-era rule gutted student borrower protections against predatory schools, making a mockery of a Congressionally-mandated consumer protection program. The Trump administration’s rule made it functionally impossible for defrauded students to obtain relief from federal student loans. Student loan debt is a massive hurdle for millions of Americans, especially those who leave deceptive programs without meaningful degrees or skills. Confronting the twin crises of predatory purveyors of worthless degrees and crushing student debt is one of the most important things we can do to jump start our economy and give families a fair shot at financial security,” said Attorney General Tong.
The federal Higher Education Act requires the U.S. Education Secretary to issue “borrower defense” regulations that provide a pathway for students to discharge federal student loan debt if they were victimized by a school. In 2016, the Obama administration's Department of Education created strong protections for student-borrowers who were defrauded by predatory for-profit colleges by establishing a fair and transparent borrower defense process for student loan debt relief. Following the change in presidential administrations, in 2019, ED rescinded those regulations and replaced them with new rules designed to prevent defrauded students from obtaining loan relief and shield predatory schools from being held accountable for their misconduct.
The amicus brief supports NYLAG's arguments that that the Trump administration’s 2019 borrower defense rule is arbitrary and capricious and therefore should be eliminated. It further supports NYLAG's allegations that in rescinding and replacing the 2016 borrower defense rule, ED relied on inaccurate, unsupported, and inconsistent assumptions, among other arguments.
In filing the amicus brief, Attorney General Tong joins the attorneys general of California, Massachusetts, Delaware, Hawaii, Illinois, Maine, Maryland, Michigan, Minnesota, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington, Wisconsin, and the District of Columbia.
A copy of the brief is available here.
Assistant Attorney General John Langmaid and Deputy Associate Attorney General Joe Chambers, Chief of the Finance and Revenue Services Section assisted the attorney general in this matter.
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