AFT Applauds Mass. Attorney General’s Lawsuit Against Student Loan Servicer over Systemic Failures

WASHINGTON—AFT President Randi Weingarten issued the following statement applauding the lawsuit filed today in state court by Massachusetts Attorney General Maura Healey against the Pennsylvania Higher Education Assistance Agency, a loan servicer doing business as FedLoan Servicing. PHEAA is accused of overcharging public employees and teachers in Massachusetts and across the country, and failing to properly process monthly payments for Public Service Loan Forgiveness recipients:

“Maura Healey has acted where Betsy DeVos and the Department of Education have repeatedly failed. Instead of protecting borrowers from systemic harm from servicers like PHEAA, DeVos betrayed and abandoned them. That’s why the AFT and a broad coalition of labor and community groups wrote 56 state attorneys general and banking commissioners in April to demand a crackdown on bad actors to prevent an imminent financial catastrophe on the scale of the mortgage crisis. The AFT applauds Healey and the state of Massachusetts for taking action against PHEAA, and for putting teachers and public employees—not lenders—first. Teachers and other public employees who have answered the call of public service rely on the Public Service Loan Forgiveness program to defray the cost of their college education. We continue to call on other states’ attorneys general and federal regulators, like the Consumer Financial Protection Bureau, to step up to the plate to fill the regulatory gap left by the department and DeVos’ reckless ignorance and inaction.”