Illinois Attorney General issued the following announcement on July 13.
Attorney General Lisa Madigan called on the U.S. Department of Education to honor its historic partnerships by reinstating the long-standing practice of disclosing student loan information to state attorneys general – a practice it curtailed without explanation last month.
In a letter sent to U.S. Education Secretary Betsy DeVos, Madigan and 19 other attorneys general note that the Department of Education in June quietly revised its policy of disclosing student loan information, reversing a practice that has existed for the better part of two decades.
Labeling the move a “mistake,” Madigan and the other attorneys general contend that limiting access to student loan information may hinder the ability of state attorneys general and other agencies to protect students from predatory lending practices and fraud.
“Student loan debt is at historic levels in our country, and borrowers are targeted by scammers every day,” Madigan said. “I have filed numerous lawsuits to protect student loan borrowers, and it is critical that state attorneys general continue this work to protect borrowers and help them repay their loans.”
Since at least 2000, the federal government has permitted disclosure of student loan information to state attorneys general and other authorities responsible for investigating and prosecuting civil fraud.
“The Department’s policy change seems to send a signal: law enforcement agencies working to combat crime, fraud, and other unlawful conduct can no longer count on the Department as a reliable partner,” the letter states. “We hope the Department does not actually intend to impede law enforcement agencies’ access to student loan information relevant to matters within their jurisdiction. But we are concerned that may be the result of the Department’s policy change.”
Madigan has been a national leader in investigating and enforcing consumer protection violations in the higher education field. Madigan filed a lawsuit against one of the largest student loan servicers in the country, Navient, for abuses in the student loan servicing industry, and has investigated for-profit schools for fraud and led efforts to secure debt relief for students who attended for-profit schools that the Department of Education has deemed fraudulent.
Madigan initiated a new law, the Illinois Student Loan Bill of Rights, to protect students from widespread abuses and failures by student loan servicing companies that make it difficult for borrowers to repay their loans. Madigan has also testified before Congress and urged the U.S. Department of Education to crack down on the many abuses and scams facing student borrowers.
Original source can be found here.