The student loan ombudsman at the Consumer Financial Protection Bureau said he was stepping down from the agency Monday in a resignation letter that sharply criticized the Trump administration.
Seth Frotman, who was also an assistant director at CFPB, told acting director Mick Mulvaney that under his leadership "the bureau has abandoned the very consumers it is tasked by Congress with protecting."
Frotman wrote that changes under the Trump administration have undercut enforcement efforts at CFPB, undermined the agency's independence and protected bad actors in the private sector from government scrutiny.
The letter reinforces many complaints from outside consumer advocates regarding the dismantling of the agency's work by Mulvaney, also the director of the Office of Management and Budget, since he was appointed on an acting basis last year. Kathy Kraninger, President Trump's nominee to lead the agency, has no experience in consumer protection.
The Education Department last year ended two information-sharing agreements with CFPB to monitor student loan complaints, accusing the agency of overreaching its jurisdiction. And last month Education Secretary Betsy DeVos proposed a new, more restrictive borrower-defense rule for student loan borrowers who were misled or defrauded by their institutions. DeVos also said earlier this year that only the federal government, and not state regulators, has the authority to oversee the federal student loan program.
Frotman wrote that CFPB staff were blocked from commenting on the implications of those moves for borrowers. And it said that the bureau's leadership had blocked the release of a report last year on large banks charging students on college campuses "legally dubious account fees."
"At every turn, your political appointees have silenced warnings by those of us tasked with standing up for servicemembers and students," he wrote.
Under former director Richard Cordray, who resigned last year before a run for Ohio governor, CFPB made a name for itself in student loan enforcement by securing settlements on behalf of borrowers and filing lawsuits including a case against Navient, the largest servicer of federal and private student loans.
In response to the Frotman resignation later, CFPB told NPR in a statement, "The bureau does not comment on specific personnel matters. We hope that all of our departing employees find fulfillment in other pursuits and we thank them for their service."
Rep. Bobby Scott, a Virginia Democrat and ranking member on the House Education and the Workforce committee, in a statement Monday called for hearings on CFPB's "sudden withdrawal from its necessary role in protecting students and student loan borrowers from predatory companies.”