Members of Congress are sounding the alarm over President Joe Biden’s plan to use billions of taxpayer dollars to pay off student loans held largely by his political supporters, alleging the program is ripe for fraud.
U.S. House Education and the Workforce Committee Chairwoman Virginia Foxx (R-NC) and Higher Education and Workforce Development Subcommittee Chairman Burgess Owens (R-UT) are now warning Education Secretary Miguel Cardona they are aware of the potential for widespread fraud within the program.
Under Biden’s plan, taxpayers would assume the debt for up to $10,000 in student loans taken out by “low and middle-income borrowers.” However, the program does not confirm income and relies entirely on “self-certification.”
“[We] write to express our deep concern about the potential for fraud within the Biden student loan debt transfer plan. Specifically, the U.S. Department of Education’s (Department) borrower application for student loan debt relief allows, or otherwise affirmatively endorses, self-certification of income. Allowing borrowers to self-attest that they fall under the income threshold will undoubtedly lead to fraud and abuse,” Foxx and Owens write.
“As the Government Accountability Office’s (GAO) Comptroller General Gene Dodaro observed earlier this year in his testimony about fraud in pandemic spending, ‘[federal] agencies should have been much better prepared in order to prevent fraud.’ With this as an observation and warning, it is obvious the student loan debt transfer plan and its income self-certification are fundamentally ill-advised given their potential for fraud,” Foxx and Owens continue.
Critics point out the Biden student loan scheme is reminiscent of easy COVID-19 “relief” loans, which resulted in billions of dollars in fraudulent payouts to criminals and even foreign government.
Critics also allege the program is an election-year “vote buying” scheme to reward Biden supporters, who are generally higher-income and not in need of relief.
In 2020 Biden won college graduates by a 55 percent to 43 percent margin over President Donald Trump, and won by a 62 percent to 37 percent margin among voters with an advanced degree.
