The U.S. Senate passed the Stop Student Debt Relief Scams Act on December 1, 2020 by unanimous consent. The legislation now proceeds to the U.S. House of Representatives for consideration.
[Update: The U.S. House of Representatives passed the legislation on December 7, 2020. The legislation now awaits President Trump’s signature.]
The Stop Student Debt Relief Scams Act bans fraudulent access to U.S. Department of Education … [+]
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The legislation makes it illegal to access U.S. Department of Education computer systems without authorization, including the unauthorized and fraudulent use of FSA IDs and other identification devices issued to another person.
FSA IDs are used to file the Free Application for Federal Student Aid (FAFSA), to apply for federal student loans and to login to U.S. Department of Education computer systems to manage the FAFSA and federal student loans.
Violations are subject to a fine of up to $20,000 and/or a prison term of up to five years.
The Stop Student Debt Relief Scams Act of 2019 (S. 1153) also requires student loan exit counseling to include warnings about third-party student debt relief companies. The services offered by these companies are already offered for free by the U.S. Department of Education and the borrower’s federal student loan servicer.
The Federal Trade Commission (FTC) and state attorneys general have cracked down on student debt…