February, 2021
Washington – The Biden administration is off to a rocky start at the Department of Justice if last week's eyebrow-raising move by acting assistant attorney general Brian Boynton is any indication of things to come.
The newly-appointed official acted to protect former Secretary of Education Betsy DeVos from being held accountable for denying defrauded student-loan borrowers their rights under law, joining DeVos's personal counsel in a federal court filing to prevent DeVos from having to give a deposition in a case brought by the victims of multiple cases of fraud, as perpetrated by for-profit colleges.
Even if he felt there was somehow an institutional DOJ responsibility to object to cabinet secretaries being deposed (and that is a stretch, because the deposition was not sought until after DeVos resigned, and a federal district judge had cleared it), the vehemence in the filing is startling. It is directed at the defrauded borrowers' counsel, the Project on Predatory Student Lending at the Harvard Law School, which has long been respected for being one of the few places to which victims can turn to protect their rights under law. PPSL has a remarkable record of success in federal court on behalf of those whose lives are being ruined by predatory lending.
There is little doubt that DeVos herself was responsible for blocking justice for tens of thousands of defrauded borrowers, just as she was responsible for blocking collection of millions of dollars of false claims owed back to taxpayers from a large student-loan lender. Days after she resigned last month, the Department of Education finally, and rightly, collected from the lender.
I hope I am wrong about this, but the action by Boynton, who will head DOJ's Civil Division, appears to be a warning shot across the bow from the for-profit college industry, which overlaps with the student loan lender/servicer industry, announcing that the revolving door between government and industry still turns, despite the November elections. Government offices captured by industry over the past two decades will not easily be given up. Boynton has a substantial record of working for these industries, both inside and outside government.
Would a recusal in his case be appropriate? Surely it would be, on the merits or on appearances, or both. But there is a long history of non-recusals and recusal violations when it comes to for-profit colleges and the lender/servicer industry.
My own experience with DOJ over many years has had its ups and downs, often intertwined with recusal issues. DOJ took two years to decide against joining my litigation against nine student-loan lenders in 2007 for false claims, rather than the two months prescribed. I believe anyone who ever looked at the evidence would be surprised if not astonished that DOJ did not take over the suit itself at some point, so as seek sanctions against the perpetrators. Failures of recusal were central to those cases, as the industry had its former officials in key Department of Education positions during the years of false claims.*
However, DOJ was helpful twice in filing memoranda with federal courts to dispute the perpetrators' defense, which led to several settlements, although there were no convictions for wrongdoing. Likewise, the Solicitor General's office at DOJ was helpful in advising the Supreme Court, which asked its opinion, not to accept a lender's writ of certiorari to overturn a loss of sovereign immunity, incurred in my litigation, from borrowers' and states' lawsuits.
But coming on the heels of that decision in 2017, Betsy DeVos moved to create another way to block borrowers from seeking redress, a "preemption" doctrine claiming that the federal Higher Education Act preempts state consumer protection laws. DOJ, in support of DeVos, filed briefs to aid the perpetrator's attempt to derail a state attorney general's lawsuit to protect aggrieved student-loan borrowers.
This came at the time when I was still in court against the same party, trying to reach settlement on long-standing issues, with DOJ personnel present at lawyer-client discussions, because I was acting on behalf of the United States even though DOJ had not taken over the case. DOJ never informed me that they were simultaneously assisting the opposing party on a related case, which seemed to me an ethical violation on top of all the damage it was doing to borrower victims' interests.
Fortunately, the DOJ maneuvering against a state attorney general lost decisively at the state court level and several federal courts have since ruled against the DeVos preemption doctrine as well. But the damage was done. Only in the past few days has Massachusetts settled with the deficient servicer, PHEAA, to provide redress to up to 250,000 of its residents. Other states cannot be far behind.
Industry capture of federal offices through revolving door appointments and iron-triangle relationships is a longstanding problem. At the Department of Education it is particularly acute. Both the borrower defense issue now contested in the deposition controversy, and the preemption issue now being unravelled by the courts, are prime examples of policies developed and implemented by those whose first loyalty is to industry. Recusals are one way of dealing with the problem, but only if they are enforced.
A good question of Attorney General designate Merrick Garland at his confirmation hearing on February 22nd would be to ask if he is prepared to enforce recusals throughout the government, including at DOJ itself.
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* Investigative journalist Dan E. Moldea, in Money, Politics, and Corruption in U.S. Higher Education (2020), illustrated two obvious instances of conflicts of interest and recusal violations. One involved an assistant secretary who passed along inside information to her former employer about upcoming audits; another showed how a top industry association official who became deputy secretary abetted the filing of false claims against taxpayers. No action was ever taken against either. It is not hard to draw a straight line from those individuals to the multiple student-loan imbroglios of today, continuing on into the future, unless the Biden administration is ready to scrub out this disgraceful legacy.
