October 19, 2009

For more information: Bob Cohen                           Luke Thomas
                                 202-336-6836                      202-336-6803
                                 bobc@career.org                  luket@career.org

Career College Association Airs Concerns on Oversight Amendment

 

Washington, DC – The Career College Association (CCA) today expressed serious concern about a proposed amendment to H.R. 3126, the Consumer Financial Protection Act of 2009, that would place private loans made by for-profit higher education institutions under the jurisdiction of the Consumer Financial Protection Agency (CFPA), a new agency to oversee consumer lending in instances in which existing oversight has proven inadequate.

 

In a letter to the House Financial Services Committee today, CCA President and CEO Harris N. Miller said, “CCA fully supports consumer protections for student loans. We support provisions that assist student consumers in making the best lending choices possible and that provide financial literacy education and loan repayment assistance.”

 

But Miller pointed out that Federal student loan programs already require ample disclosures and that changes mandated by the Higher Education Opportunity Act of 2008 that was signed into law in August, 2008, amended Regulation Z of the Truth in Lending Act (TILA), adding additional protections for students who take out private educational loans from academic institutions or banks.

 

The CCA letter points out:

 

• Backers of CFPA envisioned the agency providing consumer protection oversight where evidence exists that such oversight has failed.  However, no such evidence exists in the case of institution-based private student loans;

 

• The new TILA provisions have yet to take effect, calling into question the need for an additional layer of oversight;

 

• If such a layer is required, it should apply to all types of academic institutions, not just private sector colleges and universities.

 

“This is a clear case of a solution in search of a problem,” Miller said.  “Our schools should not be saddled with additional compliance requirements simply because they are attempting to help those in financial need get the education necessary to build better, more successful lives.”

 

The Career College Association (CCA) is a voluntary membership organization of accredited, private postsecondary schools, institutes, colleges and universities that provide career-specific educational programs. CCA has more than 1,600 members that educate and support over one million students each year for employment in over 200 occupational fields. CCA member institutions provide the full range of higher education programs: masters and doctoral degree programs, two- and four-year associate and baccalaureate degree programs, and short-term certificate and diploma programs. Visit CCA at www.career.org.