05.20.20

Chairman Scott to Secretary DeVos: Stop Illegally Garnishing Wages on Student Loan Borrowers

“The fact that, in the wake of a national emergency, the Department continues to unlawfully collect on borrowers’ loans, indicates its process is broken and that these issues are systemic and pervasive.”

WASHINGTON – In a letter to Department of Education Secretary DeVos, House Education and Labor Committee Chairman Bobby Scott (VA-03) demanded an explanation for the Department illegally garnishing the wages on student loan borrowers amid the COVID-19—a direct violation of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was signed into law on March 27.

In the letter, Chairman Scott notes that as recently as May 6, employers indicated that they could not stop garnishing wages because they had not received a letter from the Department directing them to do so. At that time, more than 50,000 student loan borrowers were still having their wages garnished, according to a lawsuit filed against the Department. As of the most recent data available, approximately 12,000 borrowers continue to be subject to wage garnishment.

The Chairman also notes that the Department has a history of illegally collecting on student loan borrowers. Last October, a federal court held the Department in contempt after violating its order to top collecting on loans of Corinthian College students with pending borrower defense claims.

“The fact that, in the wake of a national emergency, the Department continues to unlawfully collect on borrowers’ loans, indicates its process is broken and that these issues are systemic and pervasive,” the Chairman wrote. “The Committee urges the Department to immediately take every step necessary to stop illegal wage garnishment for all student borrowers and provide immediate refunds to those who have been subject to such garnishment.”

The letter requests detailed information regarding what steps the Department is taking to ensure employers stop garnishing the wages of student loan borrowers, and seeks information about the Department’s efforts to return wages that were illegally garnished. 

Read the full letter to Secretary DeVos here. 

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