The Role of State AGs in Solving Student Loan Crisis

6 minute read | March.21.2018

State attorneys general are the chief legal officers of their state; state attorneys general are the chief law enforcement officers of their state; and state attorneys general must protect their citizens and vigorously enforce their state’s consumer protection statutes. As broad as these powers and responsibilities are, however, they come with limits. For both consumer protection and political reasons, state attorneys general desperately want to assist constituents who have taken out federal student loans and are now struggling with repayment. However, they will undoubtedly fail in the courtroom if they attempt to do so through litigation. 

Clear statutory law, recent federal court decisions, and the long-standing — and recently rearticulated — positions of both the U.S. Department of Justice and U.S. Department of Education clarify that state attorneys general may not enforce state consumer protections laws when they directly conflict with the Higher Education Act of 1965 or the Department of Education’s rules regarding federal student loans. Although state attorneys general are barred from taking some enforcement action in this area, they can nevertheless serve the public by working with student loan servicers and the federal government to adopt advisory or partnership roles. 

Originally published in Law360; reprinted with permission.