Education Department “blatantly disregarding” new law prohibiting wage garnishment during coronavirus

WASHINGTON, D.C. – U.S. Senator Cory Booker (D-NJ) and Congresswoman Ayanna Pressley (D-MA) today led more than 30 of their congressional colleagues in blasting the Trump Administration for continuing to garnish wages of millions of struggling student loan borrowers, despite a new law passed by Congress last month that prohibits such wage seizures during the coronavirus public health emergency.

The protective measure was included as part of the larger CARES Act package to provide relief to student borrowers, a disproportionate number of whom are students of color: on average, black student loan borrowers end up owing more than their white counterparts, and 85 percent of black bachelor’s degree recipients carry student debt, compared with 69% of white bachelor’s degree recipients.

Student Loans (AP Photo)

“For the hundreds of thousands of struggling student loan borrowers who were seeing their hard-earned wages unfairly garnished, this protection is a critical lifeline and will undoubtedly be the difference between whether these families can pay rent, put food on the table and cover the costs of medical care,” the lawmakers wrote in a letter sent today to Education Secretary Betsy DeVos and Treasury Secretary Steve Mnuchin.

“The Department and its contracted private collection agencies, appear to be moving forward in blatant disregard to these new protections established by Congress,” the lawmakers continued, citing guidance issued by the Department on April 1 that specifically notes that borrowers’ wages may continue to be garnished.

“This Administration’s actions and disregard for these new protections under federal law will place workers and families in further economic jeopardy,” they added.

The lawmakers demanded answers by April 25 to a series of questions about the status of borrowers, their debts, and their employers.

“Senator Booker and Representative Pressley have long been champions for student loan borrowers and continue to lead the fight by holding actors across this broken system accountable for their ongoing unlawful wage garnishment,” Seth Frotman, Executive Director of the Student Borrower Protection Center and former Student Loan Ombudsman at the Consumer Financial Protection Bureau, said. “It is shameful that the Trump Administration and student loan industry are still seizing employees’ wages during a national emergency. Congress created a critical new protection for federal student loan borrowers when it halted the government’s student loan debt collection machine and the law must be followed.”

Full text of the letter is available here.

Booker and Pressley were joined by Senators Elizabeth Warren (D- MA), Bernard Sanders (D-VT), Edward Markey (D- MA), Jeff Merkley (D-OR), Brian Schatz (D- HI), Kamala Harris (D-CA), Sherrod Brown (D-OH), Bob Menendez (D-NJ), and Mazie Hirono (D-HI), as well as more than 30 members of the House of Representatives.