News Releases

Provisions will force the Department of Education to hold unscrupulous student loan servicers accountable   

Senator Murray: “When it comes to doing right by our students, I’m not going to allow Secretary DeVos’s Department of Education to skirt its responsibility to hold unscrupulous actors accountable”

(Washington, D.C.) — Senator Patty Murray (D-WA), senior member of the Senate Appropriations Committee, successfully secured provisions forcing the Department of Education’s Office of Federal Student Aid (FSA) to hold student loan servicers accountable in the year-end spending package. Senator Murray fought for the inclusion of these provisions following the release of a report from the Office of Inspector General at the Department of Education that found all nine federal servicers were “noncompliant” with federal requirements.   

Under the new measures, which passed the Senate today and now head to the President’s desk for signature, FSA will be required to re-allocate borrower accounts from student loan servicers who violate federal standards, contracts, and State and Federal laws intended to protect borrowers. The measures will also prevent FSA from awarding new contracts to servicers that have a history of violating consumer protection laws. In order to increase transparency for borrowers, Senator Murray included additional measures to require FSA to make data on student loan servicers’ performance and student loan discharges—which is already collected by the Department—available to the public.

“I was appalled when I found out that student loan servicers have consistently and repeatedly violated requirements intended to protect borrowers—without any consequences from the Department of Education. When it comes to doing right by our students, I’m not going to allow Secretary DeVos’s Department of Education to skirt its responsibility to hold unscrupulous actors accountable—so I fought to include language in the must-pass spending bill to force them to do so,” said Senator Murray. “It’s unfortunate these provisions were necessary in the first place, but I’m grateful that a bipartisan majority of both the House and the Senate agree that the Department of Education must do its job and enforce the laws on the books.”

Senator Murray has consistently called on Secretary DeVos to hold student loan companies accountable to the law and to borrowers. In April and June 2017, she led more than 150 Members of Congress in calling for student loan borrower protections to be reinstated after Secretary DeVos rescinded rules to prevent predatory, abusive, and unfair practices in student loan servicing. In September 2017, Senator Murray criticized a move by Secretary DeVos to block the Consumer Financial Protection Bureau from looking into misconduct by student loan servicers. In June 2018, she asked Secretary DeVos to answer questions about how student loan servicers were being held accountable. In December 2018, Senator Murray demanded answers to how Secretary DeVos plans to ensure student loan companies will comply with consumer protection laws in exchange for massive new federal contracts that are currently being negotiated. In March 2019, Senator Murray demanded new accountability measures be implemented to correct for servicer noncompliance that was revealed by the OIG.