June 19, 2007
Jefferson City, Mo. — Missouri Attorney General Jay Nixon and 31 other Attorneys General across the country today urged the United States Senate to quickly pass the Student Loan Sunshine Act to safeguard students and families nationwide from deceptive practices in the college loan industry. The U.S. House of Representatives passed the bill recently by an overwhelming 414-3 vote.
Investigations by Nixon, New York Attorney General Andrew Cuomo and other Attorneys General into abuses by the $85 billion college loan industry “have found a wide range of improper and illegal activities that serve as an impediment to the American dream of an affordable college education,” according to the letter sent today to Senate leaders.
In the letter sent to U.S. Senate Majority Leader Harry Reid; Senate Minority Leader Mitch McConnell; chairman of the Senate Education Committee, Edward M. Kennedy; and Sen. Michael B. Enzi, the ranking member of the committee, the Attorneys General said national legislation would serve as an important complement to work that the states have begun and address the problem with consistency for the nation. Starting this week, the Senate Education Committee will begin considering the Higher Education Amendments of 2007, during which the Sunshine Act is expected to be offered.
“With two-thirds of all college graduates leaving school with student loans, students and their families need to have access to objective and accurate information that will enable them to make choices that are most appropriate to fit their own situation,” Nixon said. “Unfortunately, we have seen examples in the last several months of institutions of higher education acting inappropriately in their relationships with lenders, including steering students to so-called 'preferred lenders.’ It’s time for action on a national level to help protect students around the country.”
The new federal law will require every school that participates in the Title IV program or has students obtaining private educational loans to adopt a Code of Conduct. Additionally, the law will:
In April, Nixon announced that his office had reached an agreement with Washington University in St. Louis that called for the university to abide by a code of conduct in its dealings with student lending institutions. Nixon said announcements about similar agreements between his office and additional Missouri institutions of higher education will be made in the near future.
In addition to Missouri, the Attorneys General who signed on to the letter represent Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Iowa, Illinois, Hawaii, Kentucky, Louisiana, Massachusetts, Michigan, Minnesota, Nevada, New Hampshire, New Jersey, New Mexico, New York, Ohio, Oklahoma, Oregon, Rhode Island, Tennessee, Utah, Virginia, Washington, West Virginia and Wyoming.