Petition to Secretary of Education Betsy DeVos:
"Stop exploring options for selling off federal student loans to exploitative private investors and instead immediately start discharging the debt of defrauded students."
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Leave it to Betsy DeVos to dream up more and more horrible ideas.
The Department of Education under DeVos is an absolute trainwreck that rewards predatory debt collection companies and makes students suffer. Now, DeVos hired corporate consultants to help her make plans to sell student loans to exploitative Wall Street investors.1
Fraudulent universities and the defunding of higher education left millions of students and families suffering with mountains of debt, and giving banks more control would make it worse. If these plans meet with immediate resistance, it will get the attention of reporters and allies in Congress and may force the Department of Education to back down.
Betsy DeVos is a nightmare for the 45 million Americans stuck with $1.56 trillion in student loan debt. Her proposed Department of Education budget would further defund public education and drive students into the hands of for-profit institutions. The department lets the companies that collect federal student loan payments cheat and lie to students, according to a scathing inspector general report. She has issued rules to help debt collectors skirt aggressive state laws and has personal financial ties to shady debt collection firms. She is even taking the side of for-profit colleges and refusing to forgive the loans of the countless students these predatory institutions defrauded.2,3,4
Now, DeVos has hired Wall Street consultants to review the federal student loan portfolio and consider options for selling loans to private investors. One of the consultants, McKinsey & Company, even has ties to some of the world's most oppressive regimes. The federal government owns more than $1 trillion of the overall student loan debt in America and makes a profit from interest on the loans. DeVos is exploring options for selling that debt into the hands of private investors – who could abuse and harass people with loans, with far fewer legal constraints, until they pay every last cent.5
At best, DeVos is handing a fat contract to corporate consultants to duplicate the analysis of the student loan portfolio that government agencies already completed. At worst, she would hand over federal student loans to some of the shadiest hedge funds and banks on Wall Street. We need to raise the heat on DeVos to stop stalling on providing debt forgiveness to defrauded students while making plans to hand student debt to private bankers.
Tell Betsy DeVos: Don't sell student loans to Wall Street. Click below to sign the petition:
- Heidi Hess, CREDO Action
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