Department Of Education Sued For Failure To Disclose Student Loan Debt Collection Information

Three advocacy groups are suing the U.S. Department of Education for having failed to disclose data on student loan debt collection practices. The American Civil Liberties Union (ACLU), National Consumer Law Center (NCLC) and the ACLU of Massachusetts want information on how agencies implement debt collection to see if their practices negatively impact borrowers of color.

According to Chronicle, the three advocacy groups that initiated the suit filed it last month under the Freedom of Information Act. They filed the suit out of fear that student loan debt collection practices implemented by the government may be discriminatory and put colored people at the losing end, particularly Blacks and Latinos.

Rachel Goodman, one of ACLU's attorneys said, "The public has a right to know how a taxpayer-funded agency handles debt collection to ensure it is done in a fair and nondiscriminatory way."

Common Dreams reported a similar statement issued by the director of NCLC's student Loan Borrower Assistance Project Persis Yu, "Given the draconian nature of the government's tools for collecting defaulted student loans, it is vital that those tools are not wielded in a racially discriminatory way."

Millions of Americans are being burdened by student loans every year. However, among the students, it was found that the weight falls more on the shoulders of Blacks and Latinos. There are twice as many colored adults who hold student debts than whites. This number makes it all the more probably for communities of color to feel the impact of student loan debt collection practices.

According to Common Dreams, there are no definite parameters by which the Office of Federal Student Aid may examine the manner of collecting student debt by race. Before, said department provided materials which were heavily redacted, which consequently does not allow the organizations to have a better view of private agencies' debt collection practices.

While NCLC analysis showed that financial incentives were given to private student loan debt collectors when they violate borrower's rights, there was no mention whether such was alleged in the lawsuit. Whether these three advocacy groups will secure a favorable judgment under FOIA is something that would have to be resolved by the courts.