Menendez Demands Student Protections From Financial Traps

August 13, 2014
The Hill 
credit card news
Sen. Bob Menendez (D-N.J.) is calling on the Department of Education to make sure that colleges are not using financial products to prey on students.

In a letter to Department of Education Secretary Arne Duncan and Consumer Financial Protection Bureau director Richard Cordray, the legislator noted that some universities are encouraging students to open campus banking accounts, then charging them hidden fees to access their financial aid. Many schools partner with banks to offer prepaid cards loaded with students' financial-aid credit balance.

Menendez suggested that, before the start of the new school year, Duncan and Cordray create reforms that would ban fees, provide protections if a card is lost or stolen, and make sure that a student’s financial information remains private.

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