August 12, 2022

(Alexandria, Virginia) – Consumer Action for a Strong Economy (CASE) Chairman Gerard Scimeca today filed public comments with the U.S. Department of Education expressing concern with proposed changes to the Borrower Defense to Repayment (BDR) Rule that makes the rule a back-door means to issue blanket student loan forgiveness without a vote by Congress.

In the public comments filed as part of the Education Department’s negotiated rulemaking for higher education, Scimeca states: “We are deeply concerned that the U.S. Department of Education is reconstructing this rule in a manner that will expedite the approval of thousands of BDR claims, en masse, without appropriate review, at the expense of, and in dereliction of, their duty to the American taxpayer. . . We believe the proposed changes would open up the floodgates, allowing claims on the narrowest of grounds to be made and granted at the Secretary’s discretion with hardly any standards for review. Hardworking Americans, including the many who did not attend college or paid their student loans deserve better oversight and treatment by Washington.”

In addition to elevating these concerns, the filing also offers a set of key recommendations:

• The Department not expand the scope of what constitutes substantial misrepresentation so that institutions can have a clear path to ensuring that they are in compliance.
• In line with BDR’s stated purpose, the Department maintain policies that require the student borrower to show intentional misrepresentation and actual harm, so that the program adheres to its original purpose: to help students who were truly defrauded and suffered harm.
• The Department, in line with the 2019 standard, prohibit group claims, and adhere to a high standard of review, to ensure that BDR claims are properly reviewed and adjudicated, and to protect against, waste, fraud, abuse, and the rubber stamping of claims.

CASE has been actively involved in elevating consumer concerns throughout the rulemaking process and in November released a paper on how the Biden Administration is weaponizing BDR to advance the free college agenda.

Full comment available here.