GOP demands Biden administration explain ‘massive student loan debt transfer scheme’.
Top Republicans Demand Records from Department of Education Over Student Loan Settlement
EXCLUSIVE — The top Republicans on the House Oversight and Education committees are demanding the Department of Education turn over records relating to a court settlement that discharged student loans for some 200,000 borrowers.
In a letter to Secretary Miguel Cardona, House Oversight Committee Chairman James Comer (R-KY) and House Education and Workforce Committee Chairwoman Virginia Foxx (R-NC) said the department’s settlement in Sweet v. Cardona raised serious concerns that the Biden administration used the case as a backdoor for student loan forgiveness.
The lawmakers wrote, “Facts surrounding the Sweet v. Cardona litigation suggest the Biden administration may be working indirectly through the settlement to bypass lawful processes to fulfill student loan bailout promises made by the President. With this letter, we request documents and information to assist with our oversight of this massive student loan debt transfer scheme.”
The Background
The Sweet case centered on a series of borrower’s defense claims filed with the Department of Education under the Trump administration. The plaintiffs, who attended for-profit colleges, alleged that the department under then-Secretary Betsy DeVos was refusing to adjudicate claims that they, as student loan borrowers, had been defrauded by their institutions.
Following the transition to the Biden administration, the Department of Education moved to settle the case by discharging the student loans of some 200,000 borrowers that attended the 150 institutions mentioned in the initial lawsuit. Court challenges to the settlement by the schools proved unsuccessful. The total cost of the settlement is estimated to be $6 billion.
The Concerns
The two Republican lawmakers said they were “concerned” that the department worked with the plaintiffs in the lawsuit to “engineer a mutually desired outcome at the expense of taxpayers and institutions of higher education.” They also added, “The Department appears to be seeking legally dubious alternative avenues to make good on President Biden’s campaign promise to cancel federal student debt.”
What’s Next?
The House Oversight and Education committees have demanded that the Department of Education turn over all records concerning the settlement. The Washington Examiner has reached out to the Department of Education for comment.
Conclusion
This is a developing story, and we will keep you updated as more information becomes available. Stay tuned!
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