Dec 14 2020
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America is fortunate to have an excellent higher education system, and is home to many of the world’s greatest and most prestigious universities. During any given year, nearly 20 million Americans are enrolled in public and private colleges studying topics ranging from engineering to business to science. Nebraska in particular is proudly home to many world-class universities educating thousands of our young people. It is no wonder that Nebraska consistently ranks among the best states for higher education according to U.S. News and World Report.
Many students, both in Nebraska and across the country, rely on loans to advance their educations and nearly two-thirds of them graduate with student loan debt. That is especially true for students who pursue postgraduate education—be it medical school, law school, or business school.
Unfortunately, scammers sometimes try to take advantage of these student borrowers. Fake companies reach out to borrowers via phone calls, emails, or texts offering them relief from their student loans. These scams often involve requests to pay significant up-front fees with false promises of low interest rates, debt refinancing, and debt forgiveness. In some cases, these fake companies are highly effective at impersonating their legitimate counterparts.
Students who took on debt for their education and careers need protection from these predatory scammers. That’s why I was proud to work across the aisle and help introduce the bipartisan Stop Student Debt Relief Scams Act with Senators Tammy Baldwin (D-Wisc.), Mike Braun (R-Ind.), and Jeanne Shaheen (D-N.H.). The legislation will enhance law enforcement and administrative abilities to shut down student relief scams. It will protect borrowers by making it easier to identify scammers while ensuring students are aware of potential risks and know how to avoid them.
Specifically, the legislation will clarify that it is a federal crime to access U.S. Department of Education information technology systems for fraud, commercial advantage, or private financial gain, and impose fines on scammers for violations of the law. The bill directs the U.S. Department of Education to create a new form of third-party access, akin to the current “preparer” function on the Free Application for Student Aid (FAFSA), in order to protect legitimate organizations. It also requires the U.S. Department of Education to maintain common-sense reporting, detection, and prevention activities to stop potential or known debt relief scams and requires student loan exit counseling to warn federal loan borrowers about debt relief scams.
After passing the House and Senate earlier this month, the Stop Student Debt Relief Scams Act now heads to the president’s desk for signature, where I expect it will become law. In order for America to retain its reputation for stellar higher education, and to keep those institutions accessible to our nation’s young people, we need to shield students from predatory scammers. I look forward to this legislation becoming law.
Thank you for participating the democratic process. I look forward to visiting with you again next week.