The Department of Education (ED) has apparently declined a request by 39 members of Congress to reinstate the Memoranda of Understanding (MOUs) between ED and the CFPB.  The members of Congress, including Elizabeth Warren, Bernie Sanders, and Senate Health, Education, Labor and Pensions ranking Democratic member Patty Murray, penned a September 14th letter just one week after CFPB Director Richard Cordray made a similar request. ED had based the termination of the MOUs on the Bureau’s failure to forward Title IV federal student loan complaints and its issuance of guidance that conflicted with ED directives.

ED’s November 13th response, addressed to Senator Murray and signed by Acting Undersecretary James Manning, emphasized that the only statutory authority explicitly referencing the CFPB’s oversight of federal student loans pertains to ED’s coordination of complaint handling with the Bureau’s Private Education Loan Ombudsman. ED’s response further echoed its termination letter by reiterating that the rescission of the MOUs was warranted by the CFPB’s failure to direct nearly 13,000 federal student loan complaints to ED for resolution or to share servicers’ responses to such complaints. In particular, ED noted that the Bureau’s handling of complaints was the cause of “unnecessary confusion for borrowers” regarding the rules governing their loans.