House Republicans Allege FSA and CFPB Have Facilitated “Gross Expansion” of Federal Control Over Student Lending
By Hugh T. Ferguson, NASFAA Senior Staff Reporter
A pair of Republican leaders is accusing the heads of Federal Student Aid (FSA) and the Consumer Financial Protection Bureau (CFPB) of evading congressional oversight and “colluding” to advance policies that will exert federal control over the student loan program.
In a pair of letters, the ranking members of the House Committee on Education and Labor, Rep. Virginia Foxx (R-N.C.), and the Financial Services Committee, Rep. Patrick McHenry (R-N.C.), wrote to the agency heads to take issue with their respective roles as well as how they’re responding to requests for information from members of Congress.
In the letter addressed to Richard Cordray, the chief operating officer of FSA, Republicans allege that there is an “opaque and improper relationship” between FSA and CFPB that has created complications in the ability of members of Congress to conduct legislative oversight of federal student loan servicing.
“In addition to facilitating the disbursement of federal student aid, FSA is responsible for overseeing federal contractors and institutions of higher education who serve as partners in the administration of the student loan program,” Foxx and McHenry write in both letters. “However, under your leadership FSA has increasingly outsourced its responsibilities to other federal and state agencies.”
Republicans also take issue with FSA targeting career-focused institutions and allege that CFPB, in its expanded oversight, is conducting a coordinated “witch-hunt” that is set on maligning one sector of higher education.
Both letters make a request for any documentation and information from the agencies that will help Republicans “clarify the relationship” between CFPB, the Department of Education, and FSA, including letters, emails, text messages, transcripts, and call logs between the three entities since Jan. 1, 2021, documents and communications related to data sharing, and more.
Foxx and McHenry request that the outlined materials be provided to them within two weeks.
Publication Date: 4/18/2022
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