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In a December 13 posting, the Department of Education announced that on December 14, it would begin sending emails to borrowers “to inform them that the company that handles billing and other services related to their federal student loans will discharge some or all of the borrower’s loans within the next 30-90 days.”… Continue Reading

At the end of last week, the Federal Trade Commission (FTC) and the Department of Veterans Affairs (VA) announced that they have entered into a Memorandum of Agreement (MOA) “to provide mutual assistance in the oversight and enforcement of laws pertaining to the advertising, sales, and enrollment practices of institutions of higher learning and other establishments that offer training for military education benefits recipients.”… Continue Reading

Earlier this week, Judge Randolph D. Moss of the D.C. federal district court heard oral argument on the renewed motion for a preliminary injunction filed by the California Association of Private Postsecondary Schools (CAPPS) seeking to preliminary enjoin the arbitration ban and class action waiver provisions in the “borrower defense” final rule (Final Rule) issued by the Dept.… Continue Reading

The Department of Education has issued a proposal that would rescind the “Borrower Defense” final rule issued by the ED in November 2016 and replace it with the “Institutional Accountability regulations” contained in the proposal.  Among the major changes to the final rule that would be made by the proposal is the removal of the final rule’s ban on the use of pre-dispute arbitration agreements  and class action waivers for borrower defense claims by schools receiving Title IV assistance under the Higher Education Act (HEA). … Continue Reading

The New Jersey Attorney General, Gurbir Grewal, has sent a letter to Department of Education Secretary Betsy Devos in which the NJ AG invites the ED to work with his office “to ensure that any investigations of fraudulent activities by educational institutions are completed properly, rather than ended prematurely or allowed to grow dormant.”… Continue Reading

In addition to the CFPB’s Spring 2018 rulemaking agenda that we have already blogged about, the Spring 2018 rulemaking agendas of several other federal agencies contain some items of interest to consumer financial services providers.

Items of particular interest are:

  • OCC.  The OCC plans to issue an Advance Notice of Proposed Rulemaking “for modernizing the current regulations to carry out the purposes of the Community Reinvestment Act.” 
… Continue Reading

The National Council of Higher Education Resources (NCHER), a national trade association representing higher education finance organizations, has written to the Department of Education urging the ED to issue preemption guidance.

In its letter, NCHER urges the ED “to issue regulatory guidance that clearly states that federal student loan servicers and guaranty agencies are governed by the Department’s rules and requirements and those of other federal agencies, and preempt state and local laws and actions that purport to regulate the activities of participants in the federal student loan programs, including federal contractors.” … Continue Reading

In a notice published in today’s Federal Register, the Dept. of Education announced that it is postponing  “until further notice” the July 1, 2017 effective date of various provisions of the “borrower defense” final rule issued by the ED last November, including the rule’s ban on arbitration agreements.  In a second notice also published in today’s Federal Register, the ED announced that it plans to establish two negotiated rulemaking committees, with one committee to develop proposed regulations to revise the “borrower defense” rule and the other to develop proposed revisions to the “gainful employment” rule that became effective in July 2015 and includes requirements for schools to make various disclosures such as graduation rates, earnings of graduates, and student debt amounts.… Continue Reading

In a memorandum issued last week, U.S. Department of Education Secretary Betsy DeVos withdrew various memoranda issued by the Obama Administration ED Secretary and the ED’s Financial Student Aid Division (FSA) that provided policy direction for a new federal student loan “state-of-the-art loan servicing ecosystem” to be procured by the ED. … Continue Reading

The Department of Education has released a memorandum to provide policy direction for the new federal student loan “state-of-the-art loan servicing ecosystem” that the ED is currently procuring.  According to the memorandum, ED expects the policy direction to guide the development of contract provisions in the new contracts that the ED will enter into with the “customer service providers” it selects to participate in servicing federal student loans on the new servicing ecosystem.  … Continue Reading