U.S. DEPARTMENT OF EDUCATION TAKES ACTION AGAINST THIRD-PARTY “DEBT RELIEF”
COMPANIES TO BETTER PROTECT ALL BORROWERS
Posted on April 21, 2016
The Higher Education Loan Coalition supports the Department of Education’s January 28 actions calling for a cease and desist to third-party “debt relief ” companies misusing the Department’s official seal to inappropriately target student loan borrowers. Federal Student Aid Chief Operating Officer James Runcie noted the growing trend of companies charging fees for federal student aid services performed free of charge by the Department and its contracted servicers.
The Coalition understands that sometimes such companies also mislead borrowers by implying they work directly with institutions of higher education when in fact they do not. The Coalition will work to help monitor such deceptive activities targeted to borrowers and calls on member institutions to: (1) educate their students about these practices, (2) provide information about free federal loan benefits, (3) review institutional websites to ensure up-to-date and accurate information is posted, and (4) take legal action when such activities are discovered.
More information about the Department’s action can be found in Mr. Runcie’s IFAP letter posted March 30, and additional resources for institutions to share with student loan borrowers can be found at
https://studentaid.ed.gov/sa/repay-loans/understand/servicers. Thank you all you do to help protect our student borrowers!