More Progress on Unfair and Deceptive Student Loan Pratices
From the Education and Labor Committee:
Federal Trade Commission Launches Inquiry Requested by Chairman Miller into Deceptive Lender Marketing Practices
WASHINGTON, D.C. — The Federal Trade Commission has launched an inquiry requested by U.S. Rep. George Miller (D-CA) into the unfair and deceptive practices that lenders use to market their products and services to students. In a letter to Miller today, Deborah Platt Majoras, the commission's chairman, said that the FTC has already begun to look into whether lenders' marketing tactics are in violation of consumer fraud and abuse and debt collection laws. As part of their probe, the FTC is reviewing examples of unfair marketing letters provided by Miller's staff.
Miller, the chairman of the House Education and Labor Committee, called for the FTC to take these actions on May 2, after coming across examples of lenders' unfair and deceptive marketing letters while conducting his own investigation into the student loan industry.
“In the wake of the Department of Education’s failures to safeguard the interests of students and their families, earlier this month the Congress took an important step to protect students from lenders' aggressive marketing practices by passing the Student Loan Sunshine Act. I am glad that the Federal Trade Commission has now taken the next critical step by investigating the appalling tactics that lenders use to target borrowers,” said Miller. “The abuses within the student loan industry don't end with the conflicts of interest and cozy financial arrangements among lenders, schools, and public officials. Borrowers who are working very hard to pay back their loans shouldn't have to worry about manipulative and misleading letters. In order to truly clean up the student loan industry, lenders who violate consumer protection laws must be held accountable.”
Earlier this month, the House passed legislation authored by Miller, the Student Loan Sunshine Act, that would clean up the student loan industry by, among other things, protecting students from aggressive marketing tactics. For more information, click here.
To view the FTC's letter to Miller today, click here.
To view Miller's letter to the FTC, click here.