In response to a proposed regulation released from U.S. Department of Education earlier this year, Arnold Ventures urges the administration to strengthen its Borrower Defense rule so that students who have been defrauded by predatory colleges have recourse to be made whole again. We also advocate for several measures to protect students and taxpayers by strengthening accountability for and oversight on predatory schools.
In particular, we would like to see a clearer loan discharge path for students when their schools close and a tighter rein on false certification of schools; we offer several recommendations to improve current rules.
In addition, we commend the department for its consensus allowing students to pursue predatory schools through the justice system rather than via forced arbitration, as well as consensus on ending the damaging practice of interest capitalization.
Through the elimination of waste, fraud, and abuse in the federal student loan system, more students will have the opportunity to receive a quality education, graduate, and contribute to the economy and society.
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