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FOR
IMMEDIATE RELEASE
Tuesday,
April 13, 2001
Students
and Colleges File Legal Briefs Opposing Anti-Student Lawsuit
From Lenders
U.S.
PIRG, the U.S. Student Association, the National Direct Loan
Coalition and the American Association of State Colleges and
Universities filed legal briefs today supporting the Department
of Education’s motion to have a lawsuit from a group of private
lenders dismissed.
“The
briefs filed today make clear that the government acted correctly
in providing increased benefits to student borrowers. The lenders who filed this suit have forgotten
that the student loan programs are intended to benefit students
– not banks,” said Ivan Frishberg, Director of the State PIRGs’
Higher Education Project.
The
lawsuit, filed by a group of lenders in the federally subsidized
student loan program, seeks to eliminate several benefits
in the Direct Student Loan program that is operated by the
federal government. Those benefits mirror similar terms and conditions
offered in the federally subsidized loan program that is operated
by a network of private banks, servicers and guarantee agencies.
“This
brief was filed to support students. If the plaintiffs—the
private lenders and agencies—win this lawsuit, the real losers
will be the thousands of students who will be forced to pay
higher loan rates. Clearly it is in their best interests to
have access to the lowest possible costs in securing loans,”
said Constatine Curis, President of the American Association
of State Colleges and Universities, which represents more
than 425 colleges, universities and systems of public higher
education.
Secretary
Paige recently filed a response to the lender lawsuit and
a motion of summary judgment, asking that the case be dismissed.
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