New York Gov. Andrew Cuomo is expected on Jan. 21 to unveil a new watchdog group within the state Department of Financial Services, whose sole purpose will be to keep students out of the clutches of predatory lenders.
According to sources, the Student Protection Unit would keep tabs on education lenders and other financial firms; and its first action will be to subpoena 13 student debt-relief companies about potentially deceptive advertising and improper fees for enrollment in programs that are offered by the U.S. government at no cost. The agency also will field complaints about student lenders.
Statistics from the Federal Reserve Bank of New York indicate that the country's student debt level has quadrupled in the past decade, reaching about $1 trillion. In New York, the average student debt per borrower is $27,310, or third-highest of any state, administration officials report.