Today, Congresswoman Jennifer Wexton (D-VA) pressed the Director of the Consumer Financial Protection Bureau (CFPB), Kathy Kraninger, over potential conflicts of interest within the Bureau’s Student Loan Ombudsman office and its inadequate staffing.
“It’s pretty swampy when the top student loan watchdog -- who is in charge of protecting student borrowers -- is a former top lawyer for a company accused of bilking thousands of student borrowers,” said Congresswoman Wexton. “Tens of millions of Americans are struggling under the burden of student loans and rely on the CFPB to protect them from predatory lenders, but the CFPB is failing those borrowers.”
The CFPB’s Student Loan Ombudsman office is currently staffed by only one individual, Robert Cameron, who is a political appointee of the Trump administration and formerly worked for one of the largest student loan servicing companies in the country, the Pennsylvania Higher Education Assistance Agency (PHEAA).
In light of Mr. Cameron’s potential conflict of interest, Wexton pressed Director Kraninger to affirm that the mission of the ombudsman is to represent borrowers, not the student loan industry. Wexton also voiced her concern over the Student Loan Ombudsman office’s inadequate staffing.
Congresswoman Alma Adams (D-NC) followed up on Wexton’s questioning after her time had expired, pressing Director Kraninger to answer Wexton’s question of whether Mr. Cameron should recuse himself from any oversight measures the Bureau might conduct regarding PHEAA. Director Kraninger refused to give a direct answer.
In 2017, the CFPB released a report criticizing PHEAA’s flawed payment process, mishandled paperwork, and inaccurate information that resulted in hundreds of public-sector employees being denied from the Public Service Loan Forgiveness Program. PHEAA was sued by the State of New York earlier this month, who accused the Agency of having “undermined the goals of the loan forgiveness program.” The Commonwealth of Massachusetts filed a similar suit in 2017.