SACRAMENTO – California Attorney General Xavier Becerra today criticized the U.S. Department of Education for proposing a new rulemaking process in order to replace two rules that protect students from deceptive practices and fraud. In a letter to Education Secretary Betsy DeVos, Attorney General Becerra and 20 attorneys general underscore that the Borrower Defense Rule, which is now in limbo, would have provided a streamlined loan forgiveness process for students who have been defrauded by for-profit universities. The second rule, the Gainful Employment Rule, would have ensured that students attending vocational programs receive an education that, at a minimum, will allow them to repay their federal student loans. Secretary DeVos announced last month that the Department would refuse to implement both of these rules as part of a “regulatory reset” while looking to develop alternative regulations that would likely leave victimized borrowers with far less protection.
“Secretary DeVos’ action shows what side she is on, and it is clearly not with our students,” said Attorney General Becerra. “Unscrupulous for-profit purveyors of a sham college education are celebrating and the American Dream is playing defense. As a Member of Congress, I supported reforms to the student lending system and defended regulations that protect student loan borrowers. As Attorney General, I will continue doing everything in my power to ensure that all who seek a higher education can do so without having to worry about the motives of for-profit schools.”
Attorney General Becerra has been a leader when it comes to holding the Department accountable. In addition to today’s action, he challenged the Department just last week for unlawfully delaying the implementation of the Borrower Defense Regulations, and prior to that, he urged Secretary DeVos to expedite loan forgiveness for students defrauded by Corinthian Colleges, among other actions. The California Attorney General’s Office also led the charge against California-based Corinthian Colleges for targeting low-income, vulnerable individuals through false advertisements that misrepresented job placement rates and the value of school programs, obtaining a $1.1 billion judgement against Corinthian on March 26, 2016.
“These Rules are the products of a significant amount of time and effort on the part of numerous stakeholders and the Department,” write the attorneys general in the letter to Secretary DeVos. “Simply abandoning them is both a waste of Departmental resources and an injustice for students. For all of the reasons discussed herein, we call on the Department to fulfill its responsibilities to students and taxpayers and reconsider its decision to revoke and replace these critical protections.”
A copy of the letter is attached to the electronic version of this release at oag.ca.gov/news