Before a very public resignation, Seth Frotman was the student loan ombudsman at the federal Consumer Financial Protection Bureau and tasked with protecting student borrowers. Now, Frotman and a handful of his former bureau employees have launched a nonprofit to monitor and help reform the student loan system. The Student Borrower Protection Center (SBPC), funded by the San Francisco-based Sandler Foundation, will aim to aid student borrowers “by working with state and local officials, rather than the federal officials who Mr. Frotman said have sought to favor lenders and servicers,” The New York Times reports.
More than 44 million Americans have some form of student loan debt, totaling more than $1.5 trillion in outstanding debt. The numbers are worse for Black and low-income students, who are more likely to default on their loans than white and higher-income peers.
The SBPC plans to help states and cities to “crack down on” predatory lenders, debt collectors, and for-profit schools, as well as to provide borrowers with information and tools needed to tackle their student debt. The center also will partner with other institutions and organizations—for instance, through its Student Loan Law Initiative, an academic collaboration with the UC Irvine School of Law focused on student debt and the law—in order to spur action on student debt.
Frotman emphasizes the need to shore up resources at the state and local levels. “One of the reasons why we are in the midst of a student debt crisis is for years, too many have looked to Washington to solve this problem,” Frotman told The Washington Post. “Washington has not and will not solve it.”