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Federal judge rules against DeVos in student loan protection lawsuit

By Ray Downs
Education Secretary Betsy DeVos speaks during a Cabinet Meeting at the White House on August 16. On Wednesday, she lost a lawsuit that accused her of illegally delaying a student loan regulation rule written by the Obama administration and set to go into effect last year. Photo by Oliver Contreras/UPI
Education Secretary Betsy DeVos speaks during a Cabinet Meeting at the White House on August 16. On Wednesday, she lost a lawsuit that accused her of illegally delaying a student loan regulation rule written by the Obama administration and set to go into effect last year. Photo by Oliver Contreras/UPI | License Photo

Sept. 12 (UPI) -- A federal judge on Wednesday ruled against Education Secretary Betsy DeVos in a lawsuit brought forth by 19 states that accused her department of delaying the implementation of regulations on student loan providers.

The lawsuit centered around the the Borrower Defense rule, which clarified and strengthened procedures for borrowers to raise claims of fraud and misrepresentation. It was written under the Obama administration in 2016 and set to go into effect on July 1, 2017.

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DeVos, who has criticized the rule for being too loose and not offering enough protections for lenders, has delayed the rule while her department writes a replacement.

But on Wednesday, U.S. District Judge Randolph Moss wrote a 57-page opinion that called DeVos' delay tactics "arbitrary and capricious."

"This case is not one in which delay only freezes the status quo; borrowers continue to be hurt every day," Moss wrote. "The delay harms not only borrowers like Plaintiffs who have already left predatory institutions and are saddled with insurmountable debt and worthless educations, but also current and future students."

However, it's not yet clear if Moss will order the implementation of the Borrower Defense rule. He is scheduled to make a decision on how to move forward on Friday.

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