Student loan watchdog quits, says administration abandoned consumers

Photo by Sharon McCutcheon on Unsplash

Via Talking Points Memo, some news that will disturb just about anyone with a student loan:

The Consumer Financial Protection Bureau’s “Student Loan Ombudsman,” responsible for guarding student borrowers against predatory lenders and scammers, has resigned in a scathing letter aimed at acting CFPB director Mick Mulvaney.

“Unfortunately, under your leadership, the Bureau has abandoned the very consumers it is tasked by Congress with protecting,” Seth Frotman’s resignation letter, obtained by NPR, read. “Instead, you have used the Bureau to serve the wishes of the most powerful financial companies in America.”

In his role at CFPB, NPR reported, Frotman oversaw the review of thousands of complaints from student borrowers.

The Trump administration — namely Mulvaney, who also serves as the White House’s budget director, and Education Secretary Betsy DeVos — has worked diligently to burn pages of Obama-era protections for student borrowers.

[…] Frotman’s letter pointed to specific wrongdoing by Mulvaney, NPR reported, including the alleged suppression of a report from his office revealing that big banks were “saddling [students] with legally dubious account fees.”

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