(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

1

 U.S. DEPARTMENT OF EDUCATION

 + + + + +

 BORROWER DEFENSES AND FINANCIAL RESPONSIBILITY

 NEGOTIATED RULEMAKING COMMITTEE 2017-2018

 + + + + +

 SESSION 1

 + + + + +

 TUESDAY

 NOVEMBER 14, 2017

 + + + + +

 The Negotiated Rulemaking Committee

met in Congressional II Room, The Holiday Inn

Washington Capitol, 550 C Street, S.W.,

Washington, D.C., at 9:00 a.m., Ted Bantle, Moira

Caruso and Rozmyn Miller, Facilitators,

presiding.

PRESENT

TED BANTLE, Federal Mediation and Conciliation 

 Service, Facilitator

MOIRA CARUSO, Federal Mediation and Conciliation 

 Service, Facilitator

ROZMYN MILLER, Federal Mediation and Conciliation

 Service, Facilitator

BRYAN BLACK, Attorney

MICHAEL BOTTRILL, CFO and CEO, SAE Institute 

 North America

KIMBERLY BROWN, Vice President, Enrollment 

 Management and Student Affairs, Des Moines 

 University

MIKE BUSADA, General Counsel and Vice President, 

 Ayers Career College

 This transcript was produced from a

recording provided by the Savan Group.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

2

STEVAUGHN BUSH, Student, Howard University 

 School of Law

EVAN DANIELS, Assistant Attorney General, 

 Government Accountability and Special 

 Litigation Unit, Office of the Arizona 

 Attorney General

CHRIS DELUCA, Attorney at Law, DeLuca Law LLC

ALYSSA DOBSON, Director of Financial Aid and 

 Scholarships, Slippery Rock University

JOHN ELLIS, Principal Deputy General Counsel and 

 Division Chief, State of Texas Office of 

 the Attorney General

ROBERT FLANIGAN, JR., Vice President for 

 Business and Financial Affairs and

 Treasurer, Spelman College

JULIANA FREDMAN, Bay Area Legal Aid

JOSELINE GARCIA, President, United States 

 Students Association

WANDA HALL, Senior Vice President and Chief 

 Compliance Officer, Edfinancial Services

ASHLEY HARRINGTON, Special Assistant to the 

 President and Counsel, Center for 

 Responsible Lending

WILLIAM HUBBARD, Vice President of Government 

 Affairs, Student Veterans of America

KELLI HUDSON PERRY, Assistant Vice President for 

 Finance and Controller, Rensselaer 

 Polytechnic Institute

GREGORY JONES, President, Compass Rose 

 Foundation

AARON LACEY, Partner, Thompson Coburn LLP 

DALE LARSON, Vice President for Business and 

 Finance/Chief Financial Officer, Dallas 

 Theological Seminary

KAY LEWIS, Assistant Vice-Provost, Enrollment 

 Executive Director of Financial Aid and 

 Scholarships, University of Washington 

DAN MADZELAN, Associate Vice President for 

 Government Relations, American Council on 

 Education

SUZANNE MARTINDALE, Senior Attorney, Consumers 

 Union
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

3

MICHALE MCCOMIS, Executive Director, Accrediting 

 Commission of Career Schools and Colleges

JEFFREY MECHANICK, Assistant Director-Nonpublic 

 Entities, Financial Accounting Standards 

 Board

SUSAN M. MENDITTO, Director, Accounting Policy, 

 National Association of College and 

 University Business Officers

LODRIGUEZ MURRAY, Vice President, Public Policy 

 and Government Affairs, United Negro 

 College Fund

BARMAK NASSIRIAN, Director of Federal Policy 

 Analysis, American Association of State 

 Colleges and Universities

JAY O'CONNELL, Director of Collections and 

 Compliance, Vermont Student Assistance 

 Corporation (VSAC)

WALTER OCHINKO, Research Director, Veterans 

 Education Success

JOHN PALMUCCI, Interim President, Chief Business 

 Officer, Maryland University of 

 Integrative Health

KAREN PETERSON SOLINSKI, Executive Vice 

 President, Higher Learning Commission

LINDA RAWLES, Rawles Law

ASHLEY ANN REICH, Senior Director of Financial 

 Aid Compliance and State Approvals,

 Liberty University

SHELDON REPP, Special Advisor and Counsel, 

 National Council of Higher Education 

 Resources

DAWNELLE ROBINSON, Associate Vice President for 

 Finance and Administration, Shaw University

RONALD E. SALLUZZO, Partner, Attain

ABBY SHAFROTH, Staff Attorney, National Consumer 

 Law Center

VALERIE SHARP, Director, Office of Financial 

 Aid, Evangel University

COLLEEN SLATTERY, Federal Contract and Compliance

 Officer, MOHELA

JONATHAN TARNOW, Partner, Drinker Biddle & Reath 

 LLP
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

4

DEPARTMENT OF EDUCATION STAFF PRESENT

JIM MANNING, Acting Under Secretary of Education

CAROLINE HONG, Office of General Counsel

BRIAN SIEGEL, Office of General Counsel 

JOHN KOLOTOS, Office of Postsecondary Education

ANNMARIE WEISMAN, Federal Negotiator, Office of 

 Postsecondary Education
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

5

1 P-R-O-C-E-E-D-I-N-G-S

2 (9:00 a.m.)

3 MS. CARUSO: Good morning, everyone. 

4 Welcome back. We're going to go ahead and get

5 started. We are looking forward to a very

6 productive day today.

7 There is certainly a lot ahead of us. 

8 The good news is that we, your facilitators

9 firmly believe that we have all of the tools and

10 resources here at this table to have that

11 productive day. So we look forward to continuing

12 our work together.

13 To get us started we are going to turn

14 it over to the Department for some remarks and

15 some updates.

16 MS. WEISMAN: Good morning. Welcome

17 back to negotiated rulemaking, Session Number 1,

18 Day 2. Very happy to have you with us again. We

19 would like to make an announcement to get us

20 started that the audio recording that we

21 discussed yesterday and agreed to has been

22 arranged.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

6

1 We have contracted for that for the

2 remainder of our sessions, including this one,

3 and it is beginning effective immediately. So

4 when we begin our session now the audio recording

5 has begun as well.

6 So we would like to thank you all for

7 your compromise on that issue and coming together

8 with us to find a creative solution and we hope

9 that it will be helpful to those who take

10 advantage of that resource.

11 To get us started this morning there

12 have been some questions posed to the Department

13 about the current claims that are in progress. 

14 And we wanted to be able to speak to you briefly

15 about that.

16 With me today we have the Acting

17 Undersecretary, Mr. Jim Manning who many of who

18 know. And Mr. Manning will be speaking with us

19 today about that status of current claims.

20 Unfortunately he will not be taking

21 questions today. But we did want to give you

22 this overview to get us started with some
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

7

1 information. And again, hopefully that will help

2 us to inform our process as we move forward.

3 MR. MANNING: Good morning. Let me

4 start by thanking you for your service on this

5 committee. Participating in an intense and time

6 consuming process like negotiated rulemaking,

7 particularly on a topic as debated as this one,

8 takes commitment.

9 So thank you for working to ensure the

10 end result is a borrower defense rule that

11 protects students, safeguards the taxpayer's

12 interest and treats institutions fairly. The

13 Department has had these same goals in mind as it

14 considers pending borrower defense claims and how

15 to administer the program in the short term until

16 new rules take effect.

17 Like all of you, Secretary DeVos views

18 borrower defense as one of the most important

19 issues facing the Department. And she has taken

20 steps to make sure it gets the attention such an

21 important issue merits.

22 While her commitment to getting
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

8

1 borrower defense right is part of why you're here

2 today, the Secretary also remains focused on

3 working through pending claims. Unfortunately,

4 she inherited a difficult situation, one where

5 there was inadequate infrastructure in place to

6 properly adjudicate claims.

7 I want to share with you briefly the

8 recent history of borrower defense, its current

9 status and where the Department is headed on

10 administering the program until new rules take

11 effect. As you know, the borrower defense

12 regulations enacted in 2016 have been delayed and

13 so the Department has and will continue to

14 consider claims under the regulatory status quo

15 which assesses a claim under applicable state law

16 and commits to the Secretary's discretion how to

17 fashion relief.

18 During the tenure the previous

19 administration had approved and discharged

20 approximately 15,000 borrower defense claims, all

21 from former Corinthian students. The Secretary

22 inherited roughly 65,000 borrower defense claims
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

9

1 when she assumed office.

2 Of those approximately 16,300 had been

3 approved in the waning days of the previous

4 administration but not yet discharged. Most of

5 these approvals were from former Corinthian

6 students.

7 But slightly more than 2,800 were from

8 former American Career Institute students in

9 Massachusetts and 33 from former ITT students in

10 California. Upon assuming my responsibilities on

11 January 20th I began an evaluation of the

12 Borrower Defense Program.

13 This review is complicated by a lack

14 of defined policies, protocols and procedures

15 established to handle the process and

16 additionally the lack of a proper SORN or a

17 database system that instead was 1,000

18 spreadsheets that had to be searched manually.

19 These claims were approved in haste

20 just before the inauguration and there was no

21 infrastructure in place to adjust them, as I just

22 said. Given the budgetary implications to the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

10

1 taxpayer and the impact on thousands of borrowers

2 and institutions it was necessary to conduct a

3 high level assessment of the program including

4 all these already approved claims.

5 Throughout the winter and early spring

6 a team consisting of both career and non-career

7 Department leadership evaluated the program and

8 worked to implement controls and procedures for

9 reviewing claims and processes for discharging

10 loans for successful claimants.

11 We examined the programs operational

12 and managerial structure within FSA and its

13 information systems and the legal and evidentiary

14 base for approving or denying claims. We also

15 looked at business practices for claims intake,

16 review, adjudication and discharge.

17 Our review uncovered several areas of

18 concern which required building an infrastructure

19 to remain, to review claims and make programmatic

20 tweaks which in turn contributed to the time it

21 has taken to adjudicate additional claims.

22 In sum, this short term evaluation was
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

11

1 needed to ensure the administration of the

2 program was built on solid foundation that would

3 in the long term operate efficiently and

4 according to sound business practices and

5 processes.

6 In respect to the more than 16,000

7 approved claims, the Secretary couldn't have been

8 clearer when she said promises made to students

9 under the current rule will be promises kept. 

10 These claims did merit a close review, but once

11 completed the Department began discharging claims

12 in late spring.

13 Most loans were discharged quickly but

14 a few more complex claims have taken longer. 

15 Approximately 2,000 of these claims fell into the

16 complex category.

17 For example, the Department began

18 approving claims from FFEL and Perkins loan

19 borrowers. However, the Department needed to

20 implement business processes and requirements in

21 order to consolidate those loans into direct

22 loans for discharge.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

12

1 There were other scenarios where

2 borrowers with approved claims had multiple

3 outstanding loans, only some of which were

4 associated with their borrower defense claim. 

5 This also made it an extended process.

6 FSA had to manually determine which of

7 these loans to discharge. In other instances

8 some of the loans associated with the claim fully

9 or partially fell outside of the applicable

10 statute of limitations.

11 And so FSA had to identify and

12 separate out those loans so borrowers would not

13 get a discharge for loans ineligible for relief. 

14 Of these complex claims all but a few hundred,

15 several hundred have been discharged or sent to

16 services for discharge.

17 Our internal saying about the program

18 is nothing in borrower defense is easy and these

19 claims certainly were not. As a side note, the

20 Department has continued to accept borrower

21 defense applications from FFEL and Perkins

22 borrowers under existing statutory authority and
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

13

1 the HEA and a part of the 2016 borrower defense

2 rulemaking that was not delayed.

3 Applicants are given a preliminary

4 determination on their claim before consolidation

5 to allow them the option of not consolidating if

6 their claim is denied. Moving forward, we have

7 approximately 95,000 pending claims of which

8 roughly 65 percent are from former Corinthian

9 students.

10 While I cannot give you a specific

11 date or number, I can tell you that approval of

12 some of these claims is imminent. While it has

13 taken some time I am confident that the work done

14 to assess and make adjustments to the program

15 during the short term hiatus in adjudicating

16 claims will yield long term improvements and

17 efficiencies beneficial to all.

18 Even the most strident borrower

19 defense advocate would recognize that undoubtedly

20 some claims are going to be denied. We have been

21 working carefully to ensure that any denial comes

22 only after a thorough review of the claim for its
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

14

1 potential applicability to an existing Department

2 finding and a full consideration of any evidence

3 provided in the application that would entitle

4 the borrower to relief.

5 I can tell you today that the

6 Department will soon begin issuing some denials. 

7 The Department recognizes that many borrowers

8 have waited a long time to hear about the

9 disposition of their claims.

10 For example, we inherited hundreds of

11 claims that had been sat on for over a year and a

12 half, some of which are now, we're close to

13 adjudicating. To mitigate the inconvenience for

14 how long it has taken to adjudicate claims

15 interest that accrues on loans for denied claims

16 will be forgiven starting one year after the

17 borrower defense application is filed.

18 The Department is also working to

19 adjudicate pending claims related to other

20 schools and we are making progress on that front. 

21 However, I will admit that we're not as close as

22 we are with the Corinthian claims.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

15

1 Unfortunately when we arrived in

2 January little to no work had been performed on

3 processes of adjudicating these claims, as I said

4 earlier. Another challenge, which I understand

5 was raised yesterday has been the difficulty in

6 assessing how to apply individual state laws to

7 particular claims.

8 Once Corinthians adjudications begin

9 our work on other claims will gather momentum. I

10 can promise you we are working day and night to

11 get these claims and I expect a consistent

12 downward trend in the number of pending claims

13 starting soon, very soon.

14 Long term I cannot express to you the

15 importance of your efforts here. While we work

16 to adjudicate claims under the existing borrower

17 defense regulations we look forward to

18 implementing an improved upon regulation that you

19 begin considering this week.

20 I want to thank you again for your

21 service. Thank you for your commitment to this

22 process and I look forward to following your
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

16

1 work. Thank you so much. Good luck.

2 MS. CARUSO: Thank you. I think his

3 mic is still on. Thank you. Okay, yes, so there

4 is a request to speak. Please come forward.

5 MS. RAWLES: How is that? It's green

6 so I think I'm on. Those are tough shoes and

7 words to follow there. But I think what I have

8 to say is important this morning.

9 That was very professional and I thank

10 the Department for those comments. My comments

11 are not unprofessional but they are also very

12 personal.

13 I had a lot of time to think about

14 this last night and this morning. I've talked to

15 a lot of people on the Committee. I think it's

16 fair to say that some of us or many of us wish

17 yesterday had gone a bit better.

18 But we're back today and in good faith

19 to hope that it does. One of the things that

20 upset me on a personal note is the assumptions

21 that many of the negotiators have made about each

22 other before we got here.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

17

1 You know, I represent the large for2 profits. People make assumptions about that. 

3 They make assumptions about my party, my

4 motivation, my positions, what I will or will not

5 support.

6 That's a mistake. You know, I come

7 from a law firm of one, Linda Rawles Law. I paid

8 my own way to come here. I came here in good

9 faith.

10 Actually to make it very personal my

11 father just passed away. I came here and left my

12 mother's side after 61 years of marriage to come

13 here because I naively, even though I've been in

14 this industry for 20 years, thought that we would

15 all negotiate in good faith.

16 And that's still my intention. We're

17 all different. We shouldn't make assumptions

18 about each other. We should be open. We should

19 negotiate in good faith.

20 You all left businesses, families to

21 come here. We're going to be back here two more

22 weeks at least. So, you know, why are we here? 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

18

1 Are we here to make a point? Are we here to make

2 a rule?

3 A couple more points and I'll be done. 

4 But what we, some of us noticed yesterday is that

5 while we were talking, okay, the personal part is

6 over so now I'm better, hard to talk about my

7 dad, is that while we were negotiating many

8 people were tweeting.

9 Many people were retweeting what some

10 bloggers and press people were tweeting in the

11 audience. They have a right to tweet whatever

12 they want. They're the public and the press.

13 I think that retweeting folks who

14 dismiss some of our constituencies out of hand

15 while you're sitting next to me, not right next

16 to me and say that you're, you know, you're

17 retweeting that the whole for-profit industry is

18 evil while you're sitting at this table

19 negotiating with me in good faith is not good

20 faith.

21 And what I would like to ask this

22 morning when I asked this person if they thought
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

19

1 it was good faith they said, yes. They asked for

2 me Twitter handle or whatever you call it these

3 days.

4 So I assume now I'm the topic of some

5 of the tweets going out from this very table. I

6 would like us to stop that. I would like to stop

7 arguing our points in social media and argue our

8 points at this table.

9 And as a sign of good faith I would

10 like to propose that we have a consensus on that,

11 that as long as we're here we will not use social

12 media to argue our case, that we will not use

13 social media to say negative things about each

14 other or our constituencies until we see if we

15 can actually create a rule.

16 And if you're not willing to do that

17 then I'm wondering if you're here in good faith. 

18 And if you're not here in good faith if the

19 Secretary should consider that those people

20 should not be on the Committee.

21 So my proposal is that we agree not to

22 argue in social media or retweet negative
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

20

1 comments from people in social media as a sign of

2 good faith during these negotiations. Thanks for

3 listening.

4 MR. BANTLE: And acknowledging the

5 proposal I would just like to open up the floor

6 to any other opening comments from Working Group

7 Members.

8 PARTICIPANT: A quick point on that.

9 So if you read over the protocols that the group

10 agreed upon, I believe it's Section C, of 6 it

11 very specifically allows Committee Members to

12 have but, nonetheless limited discussion on the

13 overall objectives and progress of the

14 negotiations.

15 I think these conversations should be

16 open and you all know how I feel about

17 transparency, mostly thanks to social media. And

18 it's important that our constituencies have

19 access to the information and discussions both in

20 real time and as accurately as possible.

21 Barring the fact that we didn't have

22 a recording yesterday it certainly is important I
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

21

1 think for many of our constituencies at the table

2 to know exactly what the discussions are. It

3 does point out that we're not allowed to comment

4 on each other.

5 I think that, I will agree to that

6 point. I think that is quite relevant. 

7 Nonetheless, our own points of view which are

8 quite specific to our constituencies I think are

9 quite relevant and certainly pertain to these

10 conversations.

11 MS. RAWLES: Can I respond to that?

12 PARTICIPANT: Briefly.

13 MS. RAWLES: Yes. I think that

14 retweeting statements that the for-profits are in

15 a conspiracy with the Department to have secret

16 hearings is a little bit more than telling your

17 constituencies what's happening around the table

18 and that we should at least agree in good faith

19 not to tweet, to retweet or, you know, put our

20 attention, have some respect for the people who

21 came to this table to not use your time to be

22 denigrating the proceedings or retweeting people
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

22

1 who are denigrating the proceedings.

2 Instead listen to what we're saying

3 and have enough respect for this process and all

4 of us to look us in the eye and say those things

5 if that's what you think at the table. If we're

6 going to have any hope of coming up with a rule

7 as opposed to just grandstanding and all going

8 home with the Department writing the rule I think

9 it's important to be honest about this.

10 MR. BANTLE: Just, as a facilitator

11 and to address the proposal on the table is it

12 safe to say that adherence and respect for 6(c)

13 which Will had commented on which I will read,

14 Members will refrain from characterizing the

15 views, motives and interests of other members,

16 going on.

17 If respected by the group would that

18 address your concern?

19 MS. RAWLES: Yes. I actually think

20 some of the activities that happened yesterday

21 that I have screen shots already violate that

22 protocol as written. So I just want a
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

23

1 recommitment to that protocol.

2 MR. BANTLE: Okay. So with that

3 understanding and with a positive outlook at our

4 efforts today, tomorrow and in the upcoming weeks

5 can we as a group recommit to the protocols as a

6 whole and to, and particularly due to the concern

7 raised Section 6(c) and the characterization of

8 other people's comments as it is written? 

9 Joseline, Dan and then Aaron.

10 MS. GARCIA: Just for clarification,

11 we're talking about refraining from

12 characterizing the views and motives of --

13 MR. BANTLE: Other Members.

14 MS. GARCIA: Okay, not about like not

15 being able to use Twitter as a form of

16 communication?

17 MR. BANTLE: Correct.

18 MS. GARCIA: Okay.

19 MR. BANTLE: Dan, I think you had your

20 tag up and then Aaron.

21 MR. MADZELAN: As part of this

22 reaffirmation can we also reaffirm the protocols
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

24

1 in the context of the discussion yesterday around

2 the recording because I think Joseline had an

3 issue about well what happens if the Department

4 comes back and says, no.

5 But the Department has come back and

6 said, yes. So can we roll that part, that aspect

7 into this as well?

8 MR. BANTLE: As a facilitator I am

9 comfortable with that. Aaron and then Abby and

10 then Will.

11 MR. LACEY: I was just going to say,

12 I mean if someone, whether it be directly or by

13 retweeting or restating a statement of someone

14 else in the public or the press, I mean if

15 someone in the public or the press is making a

16 statement that any of the negotiators or any of

17 the constituencies we represent, and I do mean

18 any, saying something that's denigrating and you

19 retweet that or promote that I don't know how you

20 could say you are not characterizing the views or

21 motives of the negotiator who represents that

22 constituency.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

25

1 And again, I think that's across the

2 table. I mean I am very happy to say for my part

3 that I will not do that.

4 I think it is not appropriate and I

5 just want us to all be very clear that, if

6 someone is taking a position contrary to that,

7 that you could actively, if you're a negotiator

8 at this table that you could in conformance with

9 these rules actively denigrate the constituency

10 represented by one of these folks during the

11 negotiations, I mean I think we should know that

12 because I would disagree that that's consistent

13 with these protocols.

14 MS. SHAFROTH: Two quick points, one

15 on the 6(c). You know, it refers to refrain from

16 characterizing views, motives or interests of

17 other Members. I had understood that to mean

18 other Members of the committee sitting here

19 today.

20 I don't believe that anyone has

21 violated that and I don't think anyone sort of

22 has acted in a way that strictly violates those
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

26

1 terms. And, you know, I think, you know, it's

2 appropriate to hear from other people about how

3 they interpret that so that we can all have a

4 common understanding going forward.

5 But I do believe that everyone is

6 coming here and trying to do their best to

7 represent their constituency and to work towards

8 rules that will serve their constituencies.

9 On the audio recording I wanted to

10 follow up on Dan's point. I certainly appreciate

11 the Department coming back, looking into audio

12 recording and making it available today.

13 That's wonderful. I wondered if we

14 could get some clarification as to when the audio

15 recording would be released to the public.

16 MS. WEISMAN: Unfortunately I don't

17 have that information. The contract was put

18 together very quickly. We would certainly try to

19 get that information.

20 I don't know if arranging for it so

21 quickly we're going to have the quickest

22 turnaround time. We can probably arrange, you
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

27

1 know, now that we're arranging for all three

2 sessions at one time we can probably get a more

3 quick turnaround time for Sessions 2 and 3.

4 But I will try to get a firm

5 commitment in terms of timing if possible.

6 MR. BANTLE: Okay. First I want to

7 thank everyone for their comments. In general if

8 I had to restate what I'm hearing, I am hearing a

9 commitment from everyone who has spoken and I am

10 seeing a commitment via body language from others

11 with an agreement to respect the process and

12 respect the individuals here.

13 I don't think it is any secret we had

14 a difficult day yesterday. But we have worked

15 through it. We were able to find a solution.

16 And if you recall at the end of the

17 day I think we had some very productive

18 conversation on Issue 1, Bullet Points 1 and 2. 

19 We shared perspectives on it. We answered

20 questions on it and we did not, you know, have

21 any conflict or back and forth on those issues.

22 As a facilitator again, appreciating
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

28

1 all the comments made, I would say I think it's

2 time we moved back into the issues. If there are

3 any outstanding concerns regarding, you know,

4 behaviors at the table, you know, feel free to

5 bring them to us as facilitators.

6 If you do have concerns that's one of

7 our jobs is to kind of manage and assist with the

8 process. But I think we, you know, we are

9 turning over a new leaf. It's a new day and

10 let's dive into the content. Michael.

11 MR. BOTTRILL: Yes, one quick comment. 

12 Appreciate wanting to move on. But because we

13 didn't have a recording yesterday I actually

14 agree with Aaron that I think we should reaffirm

15 the protocols today and have that on record.

16 MR. BANTLE: Without seeing any verbal

17 or visual rejection of that, can we see a formal

18 show of thumbs on adopting the protocols with the

19 understanding that we do have the recording

20 occurring now and we are being recorded? Prior

21 to that, Joseline has her hand up.

22 MS. GARCIA: For the Department I know
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

29

1 that you just made the contract and so you don't

2 have a firm answer as to when we can get it. For

3 the meetings in January and February would the

4 audio recording be released out at least within

5 the week that the negotiations are taking place?

6 MS. WEISMAN: Again, I have not

7 personally seen the contract. So I don't want to

8 commit to something that I haven't seen. I will

9 endeavor to get the information that we need as

10 soon as possible.

11 But I don't have access to that

12 information right now.

13 MS. GARCIA: Okay.

14 MR. BANTLE: And just as a facilitator

15 note, we have that question written down and we

16 will continue to follow up on that. Okay.

17 MS. WEISMAN: If I can add one other

18 thing. I think just so you're clear it's not

19 that we don't endeavor to be quick about it. We

20 have agreed that we would post a 508 compliant

21 recording and we want to make sure we have time

22 to allow for all of the processes that the person
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

30

1 that we've contracted with needs in order to make

2 that happen, have the time to get it posted to

3 our website.

4 So again, we will endeavor to be

5 quick. But I don't want to over promise at this

6 point.

7 PARTICIPANT: Just another

8 housekeeping from my perspective. Yesterday

9 afternoon and in light of the fact that we do

10 have a recording I did want to clarify a couple

11 of comments that I made yesterday.

12 And that centered on really what my

13 intent was, was to educate this panel on burdens

14 of proof and what we'll be looking in, in the

15 future.

16 MR. BANTLE: And if I could cut you

17 off there. My, our plan as facilitators just

18 right before we get into Bullet Point 3 was to

19 reopen the floor on 1 and 2. So maybe that would

20 fit.

21 Is it all right if we take a formal

22 vote on the ground rules and then open up the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

31

1 floor to you?

2 PARTICIPANT: Yes, I just wanted to

3 clarify while I had an opportunity to do so --

4 MR. BANTLE: Okay.

5 PARTICIPANT: -- because there was

6 again, along the lines of what Linda had spoken

7 mischaracterizations on the internet of what

8 burden of proof that I was suggesting or

9 adopting.

10 And I did not mean to do that. It was

11 merely to educate this panel on different burdens

12 of proof whether it's preponderance or clear and

13 convincing or substantial misrepresentation.

14 And I did not adopt any of them. It

15 was to educate this panel and that was my intent

16 only. And that will suffice for my comments.

17 MR. BANTLE: Okay.

18 PARTICIPANT: You don't need to come

19 back to me. Thank you.

20 MR. BANTLE: Okay. With that and

21 again, with the thought that we are going to open

22 up the floor to 1 and 2 again if there are any
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

32

1 additional comments before moving on to Bullet 3,

2 can we see a formal show of thumbs on affirming

3 the ground rules or protocol document as is?

4 Again, it will be updated with, you

5 know, filling in the blanks with all your names

6 including Mr. Anderson who has been added. I

7 know yesterday at the end of the day Annmarie had

8 a quick announcement that if there any edits that

9 needed to be made to spellings or addresses,

10 phone numbers on the contact sheet to please do

11 that.

12 Please do so we can put the correct

13 information into the protocols. But can we see a

14 formal show of thumbs on adopting the protocols

15 for the remainder of this working group? Okay,

16 seeing no thumbs down I will turn it over to

17 Moira to open up the floor on the issues.

18 MS. CARUSO: Great. Thank you, Ted. 

19 Okay, so what I'm going to start with is, I'm

20 actually just going to open it up for Bullets 1

21 and 2 if there were any comments, concerns after

22 yesterday's discussion and you would like to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

33

1 return to either of those two please feel free. 

2 Michael.

3 MR. BOTTRILL: This is a question for

4 Aaron. You had mentioned yesterday that you felt

5 like the misrepresentation and substantial

6 misrepresentation regulations as they currently

7 exist and I think Mike Busada said this as well,

8 that they are difficult or confusing or

9 convoluted.

10 I don't remember the actual term. But

11 it wasn't a positive one. Have you given any

12 thought to what changes maybe to that regulation

13 would alleviate the concerns or the problems that

14 you've run into is as a, you know, risk manager

15 and compliance officer that would alleviate kind

16 of the confusion or the problems that you see

17 with it and would still fulfill, you know, kind

18 of the, what, you know, maybe other people here

19 are talking about with regard to common law fraud

20 and other kinds of measures and things of that

21 nature?

22 I'm just trying to get a sense of it. 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

34

1 And from your viewpoint is there a way to make

2 that regulation a workable one?

3 MR. LACEY: And you mean workable for

4 the purposes of borrower defense or workable for

5 the purposes of the Department when it's

6 investigating a proceeding against an institution

7 for concerns regarding misrepresentation,

8 understanding that those are different things?

9 MR. BOTTRILL: Sure, but in the

10 context of this negotiator rulemaking for the

11 purposes of borrower defense.

12 MR. LACEY: You know, my preference

13 would be to craft a totally different standard. 

14 And there are various elements that I would like

15 to see in that standard and I assume we'll talk

16 about that.

17 But, you know, actually in my mind

18 going to the point I just made, I mean, I think

19 that it makes sense to have potentially different

20 standards for the Department when it's thinking

21 about an enforcement action and the standard that

22 would be used and sufficient for a borrower to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

35

1 pursue a discharge.

2 And just to give an example of what I

3 mean, you know, when the Department comes in they

4 might identify in the course of say a program

5 review something that they would characterize as

6 a misrepresentation under the current standard

7 which I think and by the way, just to be very

8 clear, I mean, you know, I work with institutions

9 of all types and I see all the time in program

10 review findings of institutions of all types

11 findings relating to issues with how they've

12 characterized placement rates or things on their

13 websites or what have you, right.

14 The public state institutions, private

15 non-profits and for-profits all across the

16 boards. And I think it is appropriate for the

17 Department sometimes in those program reviews

18 given what they find to raise a concern or say we

19 think this represents a misrepresentation say

20 under this current standard, right.

21 And we want the Department potentially

22 to be able to do that because we want them to be
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

36

1 able to point out to an institution that there is

2 something that they think needs to be fixed.

3 The question is whether that thing

4 they pointed out that's now in a program review

5 in a finding should also serve as a basis for all

6 of the borrowers who have gone through that

7 institution over the period of time that the

8 school was making whatever representation or

9 mistake they were making to suddenly seek a

10 discharge.

11 And I think it's really important to

12 draw a distinction there because I think I want

13 the Department in the context of administrative

14 reviews and things like that to be able to speak

15 to schools about mistakes they make and things

16 they find that they believe are

17 misrepresentations without at the same time

18 necessarily creating a basis for thousands of

19 borrowers to seek to discharge all their loans.

20 So I, even in addition to the fact

21 that I think the misrepresentation definition,

22 statute misrepresentation are very confusing I
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

37

1 think there is also a really important reason to

2 have two different standards. Thanks.

3 MS. CARUSO: Linda had a comment.

4 MS. RAWLES: I agree with that and I'm

5 not just parroting what someone else said. So

6 great comment, Aaron.

7 Some of us have talked and in addition

8 to what Aaron said about having a different

9 standard between what is used in a program review

10 by the Department and what would be used for

11 purposes of this regulation would like to see an

12 intentionality element put into it.

13 What we're looking at, and like Aaron

14 I represent a lot of different types of schools

15 and constituencies in my practice. And what we

16 don't want is if a school makes a mistake and

17 they correct it for that to be a basis.

18 So we should also, I think, consider

19 some type of safe harbor for mistakes that were

20 reasonably corrected in a reasonable time. Some

21 of us have bandied about the idea of if you have

22 a compliance program along the lines of the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

38

1 Federal Sentencing Guidelines' seven elements,

2 some of you may be familiar with that.

3 But there's a whole compliance

4 industry out there that the Department and other

5 federal agencies recognize where if you have a

6 compliance program and you monitor and you

7 educate and you take corrective action then you

8 get points for that right.

9 So we could consider something like

10 that. If you're an institution that made a

11 mistake that wasn't intentional and you have a

12 compliance program that finds and corrects these

13 mistakes that should not to lead to a claim under

14 this regulation.

15 MS. CARUSO: Yes, Caroline and then

16 Abby and then Will and then Ashley.

17 MS. HONG: This is just for Linda,

18 just as a clarification. When you're talking

19 about safe harbors are you talking about the

20 enforcement reg or are you talking about the for

21 borrower defense?

22 MS. RAWLES: I think it might find its
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

39

1 way into many parts of things we're talking

2 about. But I would prefer to see it in the

3 definition itself.

4 If you have a non-intentional

5 misrepresentation that has been corrected through

6 an effective compliance program that perhaps

7 would not meet the definition of

8 misrepresentation in the first instance.

9 MS. HONG: And that's regardless of

10 whether it's from the Department enforcement

11 perspective or from individual borrower?

12 MS. RAWLES: It would be from any

13 perspective.

14 MS. HONG: Okay.

15 MS. CARUSO: Abby.

16 MS. SHAFROTH: Thank you. So two

17 quick points hopefully. First on the, I

18 appreciate, Aaron, your point that it's important

19 for the Department to be able to continue to

20 enforce the misrepresentation standards.

21 In terms of whether that should mean

22 that thousands of borrowers who attended the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

40

1 school should all get relief, I would offer that

2 should depend on whether, you know, the or at

3 least in 2016 we decided that should depend on

4 whether it's a substantial misrepresentation.

5 So a misrepresentation that is, you

6 know, relevant to the issue here of a borrower

7 deciding to enroll or remain enrolled in a school

8 and to take out loans and also whether it was the

9 type of representation that is likely to cause

10 the borrower harm.

11 If the Department does find through

12 its enforcement practices that a school engaged

13 in a substantial misrepresentation that was

14 likely to deceive or mislead students and to

15 cause them harm I would say, yes, I don't see a

16 problem then with providing those students who

17 were subject to that substantial

18 misrepresentation with relief.

19 So I don't see those two things as

20 incongruous or as harming the Department's

21 enforcement ability. With respect to the

22 proposal about having an intent standard in part
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

41

1 to allow, to protect schools that engage in sort

2 of innocent mistakes.

3 You know, I think it's really

4 important to think about even if a mistake is

5 unintentional is it harming people. And if it is

6 harming people who should bear the cost of that

7 harm?

8 So it may be that a school did not

9 intend to, you know, we can imagine for example a

10 school recruiter misread materials she was given

11 in her training packet about what to tell

12 students when recruiting them and misread that

13 there was an eight percent job placement rate and

14 instead read that as an 80 percent job placement

15 rate.

16 If that recruiter goes around telling

17 students or telling perspective students that the

18 school has an 80 percent job placement rate and

19 she didn't intend to lie to them. She thought

20 that was the truth.

21 And the students enroll, you know,

22 thinking that this is a school where they are
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

42

1 very likely to get a job then they're harmed even

2 though that wasn't intentional. They might also

3 be harmed even if that recruiter is, even if the

4 school later counsels that recruiter and says,

5 no, it should be eight percent.

6 You're giving incorrect information. 

7 Those students who already relied on that

8 misrepresentation have already been harmed. And

9 I don't, I wouldn't want to come up with a rule

10 through this process that would leave those

11 students to have to pay down loans that they took

12 out to attend a school that they thought was

13 going to get them a job but that doesn't.

14 MR. HUBBARD: One thing to add to

15 that. If the burden of proof is intent this

16 Department last year specifically cited that

17 nearly no student would be eligible for discharge

18 under those standards. So I think it's an

19 atrocious standard.

20 MS. CARUSO: Okay. Ashley and then

21 Aaron.

22 PARTICIPANT: I was going to agree on
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

43

1 the intent standard. No student would be able to

2 benefit from that because that would be

3 incredibly hard to prove for most students

4 through the evidence that they have.

5 We've already talked about the

6 asymmetry of information between students and

7 institutions. And I just think the burden on a

8 student who is already burdened by a degree that

9 harmed them and loans that harmed them to

10 actually have to go out and find evidence of

11 intent and prove that is absolutely too much.

12 And we're trying to create a standard

13 that students can access relief without the help

14 of outside help if possible. And so we need to

15 create a standard that actually allows them to do

16 that.

17 MS. CARUSO: Aaron and then, Walter,

18 I see yours too.

19 MR. LACEY: Yes. Just so first of all

20 I agree in the sense that to your first point,

21 Abby, about the idea that the, I mean last year

22 in 2016 basically what you guys did was you came
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

44

1 up and said we do think there should be a higher

2 standard for borrower discharge and use of

3 substantial misrepresentation, that concept plus

4 actual reliance.

5 So you created sort of two thresholds,

6 one for the Department in a program review

7 proceeding or something like that and then one

8 essentially for borrower defense. My point is I

9 don't like the idea of trying to use or boot

10 strap the standard the Department is using of

11 program reviews and things like that for purposes

12 of borrower defense as well in part because I

13 think there can be confusion.

14 Also again think that the definitions

15 and misrepresentations, substantial

16 misrepresentations as a general matter are very

17 confusing. I just think we can come up with

18 something better here, just a clean and distinct

19 standard.

20 Also I mean in your example the thing

21 I would point out is there's no actual, in your

22 analogy demonstration of harm or damage to the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

45

1 student. Now there could be.

2 But you've assumed that there's harm

3 even if someone were to say it's eight percent

4 and it's actually 80 percent and the student

5 enrolls it's not clear what the damage would be,

6 right. I mean if they didn't get a good

7 education and it turned out not to be a good

8 school I understand.

9 But the fact that the institution made

10 the mistake in and of itself does not mean

11 necessarily that there was harm which brings me

12 to my next point. Is that even the FTC, I mean

13 when they're, you know, they define unfair

14 practices you know, I assume you know,

15 substantial damages is one of the core components

16 of that consideration.

17 You know, we talk a lot about

18 defrauding students and that's often the tag line

19 in the press. And I don't think there's anyone

20 at this table, I can't speak for everyone else,

21 but I am assuming there is no one else who would

22 disagree that if a student is defrauded, meaning
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

46

1 an institution commits fraud that the student

2 shouldn't have relief, right.

3 But if the term we're going to use is

4 defraud and fraud is the concern then we should

5 use a fraud standard. And what it sounds like is

6 being argued for by you all is a mistake

7 standard.

8 In other words, if somebody does, if

9 an institution does anything wrong if it's a

10 mistake and in any way it leads to any kind of

11 harm for the student substantial or otherwise,

12 and the 2016 reg does not require that, there's

13 no materiality standard for harm or damages. It

14 just says detriment.

15 So if there's any harm as a result of

16 any mistake on the part of an institution that's

17 a basis for a borrower defense claim. As the guy

18 at the table representing institutional risk

19 managers that is not a fair allocation of risk at

20 all.

21 It puts 100 percent on the risk, of

22 the risk on institutions. And I also want to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

47

1 make a really important point. When I say

2 institutions I'm not talking about some amorphous

3 legal entity in the sky.

4 I'm talking about faculty and staff

5 and the other students at the institution. If

6 you come up with a standard that puts 100 percent

7 of the risk on institutions for mistakes that

8 they make then they will have to figure out a way

9 to manage that risk.

10 And they will buy insurance premiums

11 that will go up and try to find policies that

12 will cover that risk. And it will increase

13 costs. And those costs will be put down onto

14 real people, faculty, staff and other students at

15 that institution.

16 So I just strongly encourage this

17 Committee to consider a standard that represents

18 a reasonable allocation of risk between the

19 institution. Institutions should be held,

20 absolutely should be held responsible for

21 fraudulent conduct on their part.

22 Again, I don't think anybody disagrees
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

48

1 with that. But a mistake standard with no

2 materiality element relating to harm I do not

3 represents a reasonable allocation of risk.

4 What I would suggest in whatever

5 standard we come up with, I mean I think

6 intentionality or reckless disregard. I don't

7 think necessarily you have to, you know, if an

8 institution should have known better, right, I

9 think that would be reasonable.

10 I think you need to have some sort of

11 substantial damages or material damages concept. 

12 The FTC standard also allows for a notion of

13 whether or not the consumer should have known

14 better.

15 I don't know if we would want to talk

16 about that or not. There needs to be a nexus

17 between the action of the institution and the

18 substantial damage that occurs.

19 And I do agree I think there ought to

20 be some sort of an opportunity for an institution

21 to demonstrate that it cured whatever damage

22 occurred. Although, if you have a substantial
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

49

1 damages standard then the cure ought to sort of

2 be wrapped into that because an institution ought

3 to have an opportunity to demonstrate that the

4 substantial damage didn't occur in the first

5 place.

6 MS. CARUSO: Okay. So we are going to

7 go to Walter. I just also want to point out that

8 our discussion is going into Bullet Number 3 and

9 so we're going to open it up to Bullets 3 and 4

10 because there was a question yesterday as to the

11 order of those.

12 Let's just go ahead and open it up to

13 Bullets 3 and 4. Walter please and then Linda. 

14 The other thing I just want to, want the group to

15 be mindful of this is good conversation. This is

16 good discussion.

17 Attempt to keep it to new interests

18 and I would also like to hear from some folks

19 that we haven't heard from yet. Thank you.

20 MR. OCHINKO: So I would like to talk

21 a little bit about what is misrepresentation and

22 give some concrete examples of it because I don't
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

50

1 think it's very abstract and I don't think it's

2 confusing.

3 And I don't think the

4 misrepresentation standard is confusing. I'd

5 like to submit to the Education Department

6 something that can be distributed to all of the

7 negotiators.

8 And it's a list of all the settlements

9 since 2012 by state's attorney generals and by

10 federal agencies against ten for-profit schools. 

11 And it lists the agency that brought the, or

12 arranged the settlement, the date of the

13 settlement, the amount of the settlement which is

14 about $400 million since 2012.

15 And also lists the findings which are

16 all about misrepresentation. And I would also

17 like to talk a little bit about a specific school

18 that the FTC settled with in May of 2015.

19 The school is Ashworth and the

20 settlement was about misleading students about

21 the training they received and their ability to

22 transfer credits to another school. The FTC
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

51

1 found that many programs offered by this for2 profit institution did not meet state

3 requirements for those careers including two

4 programs that are approved for the GI Bill, home

5 inspections certificates and early education

6 degrees.

7 Ashworth claimed that its Bachelor's

8 degree program in early childhood education would

9 help graduates become elementary school teachers. 

10 Yet in many states an elementary school teaching

11 license requires a degree for a regionally

12 accredited school.

13 Because Ashworth is nationally

14 accredited its graduates would fail to qualify

15 for a state teaching license. The FTC also found

16 that Ashworth recruiters referred to as admission

17 advisors by the school lied to students about

18 accreditation.

19 One student who was interested in

20 becoming a home inspector in Indiana was told by

21 an Ashworth admissions advisor the program

22 satisfied licensing requirements in that state. 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

52

1 After graduation however, the state licensing

2 board told the student that the degree was not

3 recognized in Indiana for purposes of state

4 licensing.

5 The consumer went back to the school's

6 admission advisor and was again falsely told that

7 it was recognized. In addition, claims that

8 Ashworth made about credit transfers were often

9 not true.

10 For example, the school's website and

11 print material, marketing materials claim why

12 choose online classes at Ashworth College, credit

13 transferability. And undergraduate certificates,

14 learn specialized career skills in a few short

15 weeks.

16 Transfer to a degree program to

17 continue your education. Finally, the FTC

18 complaint notes that Ashworth marketing efforts

19 had targeted military service members and their

20 families and that Ashworth advertises that it

21 employs military advisors to speak with potential

22 applicants who are eligible for military payment
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

53

1 benefits.

2 The complaint also points out that

3 Ashworth trains its admission advisors to be

4 aggressive during sales calls. Admission

5 advisors who were often seen as being

6 insufficiently aggressive at rebuttling which is

7 a term used by Ashworth, faced disciplinary

8 action that could include loss of commission or

9 even termination.

10 As part of their rebuttling training

11 Ashworth salespeople were taught to ask

12 background questions at the beginning of a call

13 about the consumer's family, employment

14 situation, educational benefits, educational

15 background and other personal information.

16 MR. BANTLE: Hey, Walter, if I could

17 just jump in.

18 MR. OCHINKO: I'm almost done.

19 MR. BANTLE: Yes. Is this something

20 that you would also be able to provide?

21 MR. OCHINKO: Yes.

22 MR. BANTLE: Okay, just because it's
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

54

1 longer. Okay, thank you.

2 MR. OCHINKO: Ashworth then instructs

3 its salespeople to use whatever information they

4 learn as pressure points later in the call to get

5 a commitment from the consumer. For example, a

6 salesperson was instructed by a supervisor to

7 remember what the consumer told you in the

8 discovery section.

9 Need a job, has kids, et cetera, use

10 those against her. These aggressive recruiting

11 tactics are remnant of the pain funnel recruiting

12 playbook uncovered during the 2012 Senate Health

13 Committee investigation.

14 So I mean I think these are pretty

15 concrete examples. I think they illustrate that

16 there's a pattern at some of these schools, that

17 it's pretty systematic. And I think it's pretty

18 clear that these are misrepresentations.

19 MR. BANTLE: Okay, Linda.

20 MS. RAWLES: By the way I didn't talk

21 much yesterday. But if I'm talking too much and

22 there's new people who want to speak if they are
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

55

1 new people I will always yield to the new people.

2 I think those last comments made a

3 little bit of my case which is, you know, maybe

4 we're playing a little bit to the audio and

5 something could be handed to us, you know, in

6 written form. But I just wanted to add that in

7 addition to intentionality I would have no

8 problem with reckless disregard, you know, as

9 part of the standard.

10 And that also we should look at

11 whether or not the student attempted to mitigate

12 the damages. No one here is for fraud. We're

13 all fine with holding people in any industry

14 accountable for fraud because if people aren't

15 held accountable for fraud it hurts all the rest

16 of the schools.

17 So what we really want, as Aaron so

18 eloquently pointed out, is something that's fair

19 to the students and the schools. We're here

20 representing our constituencies but also care

21 about vets, consumers and students as well all of

22 whom we wouldn't have a school without.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

56

1 But that we should think about whether

2 the student if they were harmed attempted to

3 mitigate harm. If you get a degree from a school

4 and perhaps there was misrepresentation

5 intentional or not or what have you and you don't

6 try to get a job and use your degree, you know,

7 there needs to be quantifiable harm.

8 There needs to be a showing that you

9 tried to mitigate that harm. There needs to be a

10 connection between the fraud and your harm. 

11 These are elements that without getting to

12 lawyered up here we see in fraud cases all the

13 time.

14 So I think many people at the table,

15 including some who speak for a broader standard

16 have used the word fraud in most of their tweets

17 and comments at this table. So if we're going to

18 stick with fraud we need to make sure that all

19 those elements surrounding proof of fraud and

20 connection and mitigation of damages are on the

21 table for conversation.

22 MR. BANTLE: Okay. And just a
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

57

1 facilitator note, we're going to move on to Kay. 

2 Aaron, did you, is your tag up again or, okay, no

3 problem. We know it's easy to forget that.

4 And again, we are here to discuss

5 views. We understand these are strongly held

6 views and we all have, you know, own interests

7 that we're here to represent.

8 But if we could continue to kind of

9 move through and have productive discussion like

10 we have I appreciate that. Kay.

11 MS. LEWIS: Yes. I'm not sure, I'm

12 sorry if I don't know which bullet this goes in. 

13 But in the previous discussions about standards

14 for fraud and the amount of damages and all that

15 it seems like we need to be talking about what is

16 the appropriate standard for the student and

17 whether the student gets relief.

18 And then there is a different standard

19 whether not an institution also needs to be then

20 held accountable for that. And so when we're

21 talking about just cases of mistakes,

22 unintentional then the institution maybe wouldn't
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

58

1 be held to a standard of having to recover or

2 payback part of those funds

3 But the student would still get

4 relieved if they were harmed in the action that

5 occurred.

6 MS. CARUSO: Ashley Reich.

7 MS. REICH: I wanted to follow up with

8 the Department on a question that was raised by

9 someone I can't remember here yesterday. Since

10 we're talking about definitions of substantial

11 misrepresentation, did the Department, were they

12 able to gather some examples of the current

13 claims of what is considered to be substantial

14 misrepresentation?

15 I know there was a question yesterday

16 if the Department could bring back some examples

17 and just wondered if they had that and that might

18 help shape some of the conversation.

19 MS. WEISMAN: I do not have that yet,

20 no.

21 MS. CARUSO: Yes, Aaron.

22 MR. LACEY: Just two comments. I'll
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

59

1 be quick. Two quick comments. The first is I

2 just, with regard to the examples of

3 misrepresentation I do not -- I mean clearly

4 there are schools, company, every industry, every

5 sector of higher ed, outside of higher ed it's

6 all people and people make mistakes.

7 I have no doubt that there are schools

8 that have engaged in bad conduct and

9 unfortunately will continue to engage in bad

10 conduct. That's why we need this.

11 And there's no doubt that in some

12 cases it will be misrepresentation that rises to

13 the level of whatever standard we come up with. 

14 So I readily acknowledge that.

15 The other point I wanted to make in

16 response is, you know, as a representative of

17 institutional risk managers I don't have a huge

18 issue with bifurcating the process.

19 But my concern is if you create two

20 different standards, one for discharge of the

21 claim and one for recovery from schools, you

22 expose the taxpayer pretty significantly, right,
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

60

1 because you could discharge thousands and

2 thousands of dollars of loans and then if you

3 have a second standard that's higher so that you

4 can't recover, we're all just paying for that. 

5 So just a point for thought.

6 MS. CARUSO: Dan.

7 MR. MADZELAN: Just respond briefly to

8 Aaron. The Government already assumes all the

9 risk in the student loan program with some minor

10 adjustments.

11 But, you know, this is part of the

12 overall public policy of ensuring access to

13 higher education for those who otherwise would

14 not have the means, financial means to do that.

15 MS. CARUSO: All right. Any -- Abby.

16 MS. SHAFROTH: I want to raise a

17 concern or sort of an anomaly that would result

18 if we, if this committee established a federal

19 standard for relief that was significantly more

20 restrictive than the standards that exist in

21 state consumer protection law.

22 Most, generally private student loan
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

61

1 contracts are subject to this thing called the

2 FTC holder rule which means that borrowers would

3 be able to raise any of the state law claims and

4 defenses to repayment of that loan that they

5 could against the school.

6 This means in practice that if the

7 school violated the state's consumer protection

8 law which many state consumer protection laws

9 have a standard that is more similar to

10 misrepresentation certainly do not require proof

11 of intent, that the student could attain relief

12 on their private student loans based on that

13 state consumer protection law standard.

14 But then wouldn't be able to get

15 relief on their federal student loans because the

16 standard would be much higher to get relief on

17 the federal student loans. That seems to me

18 incongruous that the private student loan system

19 would be more forgiving to borrowers and more

20 protective of borrowers who have been abused than

21 the federal system.

22 MS. CARUSO: Joseline.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

62

1 MS. GARCIA: I just would like to put

2 into perspective of the situations that so many

3 students are in. I think it is a lot to ask for,

4 for students to mitigate fraud on their own.

5 For example, like I'm first generation

6 and my parents were immigrants, at one point

7 undocumented. How do you expect someone to be

8 able to understand how these institutions work,

9 understand how these policies work to be able to

10 mitigate fraud on their own?

11 Institutions have massive resources

12 and it places students in this David versus

13 Goliath situation which I think is unfair and,

14 you know, considering the fact that I am

15 representing students it's not in their favor

16 and, you know, I will leave it at that.

17 MS. CARUSO: Linda and then Mike.

18 MS. RAWLES: Yes. I'm also first

19 generation so I'm very understanding of that. 

20 First person in my family to go to college was a

21 poor, single mother.

22 When I say mitigate damages I don't
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

63

1 want to be too lawyer-ese here. I don't mean

2 that they have to go and fight the school on

3 their own.

4 I'm just saying that if they have a

5 degree and they claim that they were defrauded

6 that they still have an obligation to reduce the

7 damages to them by their own behavior in seeking

8 employment. I'm not talking about them

9 litigating the schools on their own.

10 So I didn't want to use a legal term

11 mitigation of damage in a way that was confusing.

12 MS. CARUSO: Thank you. Mike.

13 MR. BUSADA: As I get ready to comment

14 on more of these issues I just wanted to take the

15 opportunity because my experience is very

16 different.

17 MR. BANTLE: Hey, Mike. Ashley could

18 you just turn off, I think we have the two mikes

19 right next to each other on which might give a

20 little feedback. Thank you.

21 MR. BUSADA: And so I just wanted to

22 share briefly where I come from on a lot of these
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

64

1 issues and what really is the foundation for a

2 lot of the points that I'll be making. I am the

3 general counsel and vice president of a very

4 small school in Shreveport, Louisiana.

5 We have about 100 students. We have

6 about 100 students regularly students starting,

7 students stopping. City of Shreveport is about

8 300,000 people.

9 When I graduated college I went to go

10 practice law. I got my law degree and I went and

11 worked for a firm, a large firm in south

12 Louisiana, a regional firm.

13 When the regulatory environment was

14 changing because my family had been running this

15 school for about 30 years, when the regulatory

16 environment started changing they called me and

17 they said, Mike, would come back to Shreveport?

18 And I said why? They said because we

19 want to make sure that we have the most compliant

20 system and there's going to be a lot of changes

21 and we need a lawyer that can make sure that

22 we're doing everything right.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

65

1 I said with all due respect, Dad,

2 you're a small school and attorneys at big firms

3 get paid a good bit of money. Let's be honest.

4 He said, I know. He said we won't

5 ever be able to pay you what you could at a

6 private firm. He said, but we really need you to

7 think about this because of what it's meant for

8 our community, what it's meant for Shreveport,

9 what it's meant for the people that we know.

10 I said, well, give me some time and I

11 thought about it. And I decided to do it and I

12 went back to Shreveport and I spent a decent

13 amount of my time helping them with their legal

14 issues, compliance issues making sure that

15 everything is done just right.

16 And we do need to have absolutely

17 strong regulations. There needs to be rules of

18 the road. We are a for-profit school mainly

19 because I guess when we decided to set it up the

20 professionals that you had to hire to meet for21 profit regulations were cheaper than the ones

22 that you had to meet to hire, to meet not for-
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

66

1 profit regulations.

2 I've done both. The regulations on

3 both are very, very big. I represent non4 profits. There's a ton of regulations. It's

5 expensive.

6 The other thing is we all went to

7 public schools, public high schools. My family

8 said we're not, we're going to make sure as an

9 education institution because the rest of

10 Louisiana public schools aren't as good as in

11 Shreveport.

12 We've got great public schools. And

13 they said the only thing keeping our public

14 schools working is our tax base, people paying

15 taxes to keep our public schools going.

16 If we don't pay our own taxes then

17 we're not going to have people to even train

18 because our education system is going to be so

19 bad. So what I tell you is we need rules.

20 I will tell you right now definitively

21 any institution whether it's public, private,

22 for-profit, not for-profit that takes advantage
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

67

1 of a student, that doesn't do what they deliver

2 they need to be removed from this industry and

3 there needs to be significant swift consequences

4 because it's bad for everybody.

5 It's bad for us. It's bad for all the

6 people that I know, three generations of people. 

7 I've met a mom, a grandmother and a daughter that

8 all came through our school all different

9 professions, were all successful.

10 We teach pharmacy technicians. If the

11 pharmacy technicians that graduate from Ayers

12 Career College if they're not well qualified

13 there's a good chance that pharmacy technician is

14 going to be dispensing the medicine for my niece

15 or my nephew.

16 When I got a home alarm system at my

17 house we do electronics technicians. Teach how

18 to do home automation. Coincidentally when I

19 moved into a new house the person that came was a

20 graduate of Ayers Career College.

21 I feel safer being here knowing that

22 my wife is at a home with a system that's secure. 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

68

1 So we have to work with those people and deal

2 with those people.

3 So maybe my issues are a little

4 different. But I just want to make sure that we

5 keep focus on how do we make sure that people

6 like my family, people that are trying to make

7 sure that everybody gets an education, people

8 that didn't have some of the benefits that I had

9 growing up, how do we make sure because there's a

10 lot of people that come to our schools that say

11 you know what I didn't have anywhere else to go

12 because nothing else, nobody else would work with

13 me.

14 Nothing else was affordable. I didn't

15 have an option. And I'll leave you with this

16 story. I had a student when I was in middle

17 school. I didn't understand what my family did

18 as far as education.

19 I thought, okay, that's a school. 

20 That's neat, you know. Didn't really understand

21 it. And a kid in my gym class in a public high

22 school, I mean a public middle school we were
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

69

1 sitting in the gym and I was not the most

2 athletic person and so I tried to sit on the side

3 as much as I could.

4 And he was sitting next to me. And he

5 found out that my dad worked at Ayers Career

6 College. And he said he thought it was so cool. 

7 And it was almost like I was a celebrity and I'm

8 thinking, you know, I didn't really, I didn't

9 understand it.

10 And he said look I just want to tell

11 you that we used to live in a neighborhood it's

12 called the Cedar Grove neighborhood of

13 Shreveport. And for a period of time, the 90s, a

14 very, very high crime area.

15 There were riots in the 90s. And he

16 told me, he said, you know, we would have to come

17 in when the lights, when the sun started going

18 down. And we couldn't sit on the furniture.

19 We had to sit on the floor because at

20 least once a month there was a drive by shooting

21 in the neighborhood and my parents would say get

22 on the ground and we got on the ground. And we
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

70

1 just waited.

2 And then the next day we would worry

3 about it all over again when we came to school. 

4 He said my dad finally went to your school,

5 graduated from your school.

6 He got a job. We were able to move to

7 a new neighborhood. He said I get to come to

8 school now and I'm not worried about getting shot

9 in my house when I go home.

10 And that still didn't sink in to me as

11 a middle school student. I went home and I told

12 my dad that. And he just looked at me and said,

13 Michael, that's why we do what we do.

14 These are our friends, people in our

15 community. That's how I was brought up. So I

16 just want to make sure as we do all of this that

17 we make sure that we put in strong, stringent

18 regulations that protect students but that also

19 allow us, those schools that can't hire a bunch

20 of attorneys unless you've got one related to you

21 in the family that's willing to do some, you

22 know, some very cheap work.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

71

1 You can't hire accountants. Can't

2 hire all these professionals. But we want to do

3 the right thing and we do the right thing.

4 And so let's make sure that we don't

5 get rid of those types of institutions because I

6 think if we do that we will end up compounding

7 any, the problems that are there because we will

8 get rid of those people that are doing what I

9 think everybody in here wants to see happen.

10 MS. CARUSO: Thanks, Michael. Will,

11 if you can quickly and then we're going to take

12 our morning break.

13 MR. HUBBARD: Thanks, Moira, I'll be

14 very brief. Mike, very powerful story. I mean

15 at the end of the day to your point it was a

16 story of a school trying to help students

17 succeed, right. I mean that's what I think we

18 are all here to do.

19 The challenge certainly with military

20 veterans, military connected students, their

21 families is they're dealing with a system that's

22 perhaps only more complicated than the Department
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

72

1 of Education system which is not simple which is

2 the VA system, equally complex if not more so.

3 They're balancing these two things at

4 the same time. They go to a school in some cases

5 that they find they don't have a good experience

6 at. The programs aren't great and they find that

7 they're having a difficult time getting a job.

8 Are we to ask that student that

9 they're not trying hard enough? Are we to blame

10 that student that they haven't gotten a job yet

11 because it sounds dangerously like the

12 conversation is going that direction?

13 And I want to ensure that everybody

14 around the table is having the student at the top

15 of their pyramid. I mean that's what we're here

16 for.

17 Mike, your story, they're right at the

18 top of the pyramid in that case. And to say that

19 the student didn't try hard enough to get a job

20 is ignoring the fact that the piece of paper they

21 graduated with potentially, not always but

22 potentially could be worthless.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

73

1 And so to say that the student hasn't

2 done enough would be a lot like telling a person

3 who is injured physically that they're not trying

4 hard enough to live. It just doesn't make sense.

5 MS. CARUSO: All right. We're going

6 to take a 15 minute break. It is currently

7 10:10. Please come back at 10:25. And be

8 prepared to speak to Points 5 and 6 under Issue

9 1. Thank you very much.

10 (Whereupon, the above-entitled matter

11 went off the record at 10:10 a.m. and resumed at

12 10:25 a.m.)

13 MS. CARUSO: All right, everyone. 

14 We're going to go ahead and get started. And to

15 get started we have some remarks from Caroline.

16 MS. HONG: Hi, all. Thank you so much

17 for the productive conversation this morning. I

18 just want to have a quick note that these are, as

19 we're all aware very public hearings.

20 So if in the course of your remarks

21 you're aware of some examples you want to raise

22 or some people that you would like to reference
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

74

1 just keep in mind that we should limit our

2 remarks or comments about individual schools or

3 people to what's already part of the public

4 record in the media and not talk about things

5 that may not already be out there in the public. 

6 Thank you.

7 MS. CARUSO: Thank you, Caroline. Now

8 turning back to the questions before us, just a

9 reminder to the group that we do need answers to

10 these questions as the Department prepares to

11 make some initial draft regulations for your

12 consideration and comment and negotiation.

13 So as we move forward we're going to

14 jump in on Question Number 5. But if you are

15 going to answer another question please specify

16 which one it is. And with that I turn it over to

17 the group. Yes, Dan.

18 MR. MADZELAN: I'm not sure which

19 bullet this falls under because this was a

20 thought that occurred to me when I was listening

21 to the discussion about, you know, definitions of

22 misrepresentation, that sort of thing.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

75

1 And I just want to raise an issue and

2 I don't have an answer because I haven't thought

3 it through. But there is a provision in the

4 promissory note that basically says, you know, I

5 promise to repay even if I don't like the result

6 of my education.

7 So I just think that's something for

8 us and the Department to keep in mind that when

9 we get to the drafting part of this is there some

10 sort of conforming amendment to that portion of

11 the regulation.

12 And again, I just don't want to get

13 into a situation where there's a collision

14 between, you know, a long standing provision, you

15 know, I promise to repay no matter what and a

16 provision that sort of has a little bit of an

17 exception to that no matter what.

18 So I just wanted to put that out in

19 front of the group to sort of keep in the back of

20 our minds.

21 MS. CARUSO: Sure, Evan.

22 MR. DANIELS: I just wanted to point
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

76

1 out going and this relates really to Bullet Point

2 1, but John articulated the view of the states

3 that state law provides adequate definitions for

4 these things.

5 And as we discuss whether the

6 Department should adopt a federal definition of

7 what is a misrepresentation and what not I just

8 want to point out that those definitions in large

9 part exist in state law.

10 My understanding is that all 50 states

11 as well as the District of Columbia and Puerto

12 Rico, they all have UDAP laws, Unfair and

13 Deceptive Act and Practices laws that largely

14 provide definitions. And the courts and the

15 states have looked at what is a

16 misrepresentation, what is a deceptive act and

17 practice.

18 So I can't help but wonder if the

19 Department is trying to reinvent the wheel and of

20 course we think that state law in large part

21 provides adequate definitions to evaluate

22 borrower defense issues. And to that point, you
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

77

1 know, there was some discussion yesterday about

2 whether a federal standard would provide the

3 floor from which the states could build up if

4 they wanted.

5 I don't know that we would, we being

6 in Arizona would agree that is how it ought to

7 be. But nevertheless, the point I'm trying to

8 make is that state law, I believe, provides that

9 floor already and therefore the federal

10 definition is unnecessary.

11 MS. CARUSO: Sure. Michael and then

12 Linda.

13 MR. BOTTRILL: I would just say from

14 an accreditation perspective that has an

15 opportunity to work in all 50 states across

16 several types of different institutions there

17 simply is not consistency in the application.

18 They all may have and they may be

19 different measures the extent to which one

20 attorney general works towards those claims can

21 be very inconsistent to the next. It's just,

22 there is just simply not consistency amongst the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

78

1 states.

2 MS. RAWLES: Believe it or not I

3 almost didn't talk because that's close to what I

4 was going to say. But and I hate to argue with

5 my colleague from Arizona being an Arizonan, but

6 I think, you know, I've taught constitutional

7 law.

8 I don't see the same constitutional

9 issue that you gentlemen do although I'm happy to

10 discuss it. But practically speaking if you have

11 an online school that's operating in most of the

12 50 states I think you're really putting a tough

13 burden on those schools who are trying to do the

14 right thing and operate in 50 states.

15 And I also think there's a large

16 danger of overly politicizing the issue because

17 if a school happens to be in say California

18 versus Arizona, you know, schools are going to be

19 treated very differently depending on where they

20 are located and whether they are ground or online

21 and that's a big concern to many people.

22 MR. BANTLE: Briefly, yes, and then we
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

79

1 have Suzanne.

2 MR. DANIELS: So I raised the issue,

3 I appreciate the differences in application. I'm

4 more or less talking about the standard itself. 

5 And notwithstanding how the standard might be

6 applied or how, I can't speak for the actions of

7 the attorney general.

8 I'm discussing more or less the

9 standard by which a borrower defense claim may be

10 brought. And as a legal matter I believe the

11 standards that you get in state law are more or

12 less the same in terms of what is an act or an

13 omission under the UDAP laws.

14 They're very similar. So again, the

15 point I was making was not so much to say what

16 attorney general will do what. It's more about

17 what the standard is for bringing a borrower

18 defense claim.

19 MR. BANTLE: Okay. We'll go to

20 Suzanne and Abby. And again, remember we're here

21 during this first session to collect information

22 so the Department can put together proposals for
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

80

1 us all to look at.

2 So we do appreciate, you know, having

3 a full understanding of those two perspectives.

4 MS. MARTINDALE: Yes. I also, I want

5 to kind of to the point that Evan is making, you

6 know, obviously there is, you know, robust

7 jurisprudence around state UDAP laws, a lot of

8 precedent there.

9 There are laws that schools are

10 already having to comply with. I would also note

11 -- I don't want to go down a discussion on state

12 authorization, a rule that I negotiated and that

13 was painful.

14 But, you know, there are, it's

15 complicated with, you know, brick and mortar,

16 distance ed, combinations. Some schools, you

17 know, seeking to operate in all 50 states which

18 is their prerogative.

19 But, you know, states do have a role

20 here. They do have to conduct active review over

21 schools. And so there are already laws out there

22 on the books that schools are, you know, on
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

81

1 notice that they have to comply with.

2 So I think that the, I just wanted to

3 echo the, you know, the important role of states,

4 state AGs and state laws in protecting students.

5 MR. BANTLE: Thank you. Abby, Chris.

6 MS. SHAFROTH: On the UDAP point so

7 UDAP, Unfair and Deceptive Acts and Practices,

8 sorry for the alphabet soup here. The, many,

9 yes, I believe all the states do have UDAP laws

10 and in large part those laws are in many ways

11 consistent with or explicitly modeled after

12 federal law including the definition of unfair

13 under the Federal Trade Commission Act and the

14 definition of deceptive conduct there as well.

15 So, you know, if we're looking for a

16 basis to start for a federal standard that could

17 be a complement to state law basis for relief

18 looking to the FTC Act and its definitions of

19 unfair and deceptive acts and practices seems

20 like it would make sense.

21 MR. BANTLE: Chris.

22 MR. DELUCA: I just wanted to go back
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

82

1 to some of the points that were made earlier this

2 morning.

3 (Off-microphone comment)

4 MR. DELUCA: I'll try to clarify. I

5 get that a lot. I'm a lawyer. That's what

6 people tell me. But I think when we're talking

7 about, again, looking at a process. And one of

8 the things that was mentioned this morning was

9 that there is 95,000 pending claims if I heard

10 that right.

11 And one of the challenges with that,

12 what I heard also, was applying 50 plus, you

13 know, 50 states plus Puerto Rico and D.C.

14 statutes to the process of the claim. And again

15 we're looking to determine, to come up with a

16 process that provides relief to students who

17 deserve it.

18 And in order to do that in an

19 efficient manner plus, you know, when we're

20 talking about relationships between the students

21 and the federal government with federal student

22 loans it seems like a uniform standard, federal
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

83

1 standard would be one, fair; two, constitutional,

2 I believe and three, help with this process.

3 And I recognize that the 95,000

4 pending claims are under the old rules so it

5 wouldn't apply to those. But we're looking at a

6 rule and trying to come up with a best practice

7 going forward and that's why again I think given

8 the realities of what we're facing here that

9 applying a uniform standard would make sense.

10 MS. CARUSO: Great. Thank you, Chris. 

11 Valerie and then Aaron.

12 MS. SHARP: I would just like to ask

13 for those of us who are not attorneys and

14 familiar with all of the state UDAP laws if it

15 would be possible to get some of the wording of

16 how those laws are written and operate.

17 I do agree that, with Abby that it

18 might be very helpful to if it is working and

19 providing relief for students that it might be

20 good for this committee to see that and be able

21 to use that as we try to frame what we want to

22 look at as misrepresentation.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

84

1 And if we could have some of that for

2 those of us who aren't familiar with that to

3 inform our discussions. I don't know if our

4 state attorney general representatives would be

5 willing to do that for us.

6 MR. BANTLE: Seeking volunteers.

7 MR. DANIELS: I can certainly provide

8 you with Arizona's law. I'm not going to promise

9 to provide a 50 state survey. But certainly I

10 can send around Arizona's law. That wouldn't be

11 difficult.

12 MR. BANTLE: Abby, did you have a

13 response or --

14 MS. SHAFROTH: Yes. I'm not sure the

15 most recent date of the update. But the National

16 Consumer Law Center does have a report, sort of

17 an overview of the UDAP laws of the 50 states

18 that I can circulate to the group if that would

19 be helpful.

20 PARTICIPANT: And we can circulate a

21 link from the FTC Act as well.

22 MR. BANTLE: Okay. We'll turn it over
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

85

1 to Aaron and then I would like to open it up to

2 the Department. If you have any additional

3 questions on the items we've covered and then

4 maybe you could put a finer point on kind of the

5 final items in Number 1, if there's specific

6 information you're looking for noting that we do

7 have 2 through 8 to get to.

8 MR. LACEY: Just as a matter for

9 consideration because I mean I've already been on

10 the record as saying I think a federal standard

11 could make sense. But if we were to go with, you

12 know, borrowers bringing claims under state law I

13 just wanted to note that I believe under the

14 formulation of the reg that was in effect, you

15 know, through the late 90s and early aughts, it

16 talked about giving rise to a cause of action

17 under state law.

18 It did not specify unfair practices,

19 you know, deceptive acts laws in particular. So

20 if we're going to go the route of referencing

21 state law instead of using a federal standard I

22 just want to say we also need to think about
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

86

1 drawing a box around exactly what state laws

2 we're talking about or at least being clear

3 because, you know, otherwise it could be

4 anything.

5 PARTICIPANT: On that point the,

6 another potential state law basis for relief is a

7 breach of contract. Contract claims are

8 generally governed by state law.

9 The breach of contract or other

10 defenses to contract, the 2016 rules included in

11 addition to substantial misrepresentation a

12 breach of contract as a independent basis for

13 relief. And that was set forth as a sort of

14 federal standard.

15 I would offer and hopefully the AGs

16 will back me up that it would make sense to allow

17 state contract offenses to provide a basis for

18 relief given that contract law is governed by

19 state law and has been developed extensively in

20 the context of state law.

21 MS. CARUSO: Linda.

22 MS. RAWLES: If we're going to break
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

87

1 up the breach of contract as a basis for relief

2 and revisit the last proposed rule that was

3 rescinded we have to remember that those breaches

4 of contract had to relate to the educational

5 experience of the loan of the student.

6 So again, we have to be careful that

7 we're making this clear and fair to all parties

8 and not so broad that no one can understand it.

9 MS. CARUSO: John.

10 PARTICIPANT: I think the states would

11 agree to the degree to which breach of contract

12 should be included in this that applicable state

13 law would be what govern the breach of contract.

14 MS. CARUSO: So if the Department

15 could just comment on any questions that you feel

16 you need answers to, anything within Item, Issue

17 Number 1.

18 MS. WEISMAN: I appreciate the

19 dialogue. I think we've gotten some good

20 information from you on Bullet Points 1 through

21 4. But I think we could use a little additional

22 fleshing out of things like burden of proof and
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

88

1 the ideas of full versus partial relief.

2 So if we could have a little bit more

3 on those two topics that would be helpful. Thank

4 you.

5 MS. CARUSO: Michael.

6 MR. BOTTRILL: Well I'll just go to

7 the very last sentence in the last bullet which

8 was should the Department consider whether the

9 borrower could have ascertained the truth without

10 difficulty, inconvenience or special skill.

11 And I don't think that should be a

12 consideration for the measure of determining the

13 relief.

14 MS. CARUSO: Yes, Linda and then Will.

15 MS. RAWLES: I think if we're talking

16 about fraud and we're looking at the elements

17 that any reasonable person would have to prove to

18 either get redress or damages, there should

19 always be some reasonable standard that that

20 person acted reasonably to mitigate those

21 damages.

22 I think we should also consider
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

89

1 whether those damages should be full or partial

2 depending on the harm. If we really are

3 concerned about students and the damage to

4 students we shouldn't be afraid to say let's make

5 sure that particular student was damaged.

6 I don't think that's cruel or

7 unreasonable. And I think the burden of proof

8 should depend on who is the fact finder whether

9 it's the Department or it's put out for more of a

10 hearing type thing in which case we want to make

11 sure the standard is commensurate with due

12 process for the institution and the student.

13 MS. CARUSO: Yes, before I go to

14 William. Michael, when you say that you don't

15 feel the Department should consider whether the

16 borrower could have ascertained the truth under

17 these circumstances could you just let the

18 Department know and everyone at the table know

19 what is driving that, where that's coming from?

20 MR. BOTTRILL: Sure. And again,

21 taking this again from our experience in the

22 accreditation community. If an institution makes
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

90

1 a claim whether it's an employment raid or the

2 transferability of credit or the issue of the

3 student, the burden should not be on the student

4 to then go and identify the veracity of that

5 claim when making determinations about whether or

6 not to enroll in that institution.

7 They are doing that on the basis of

8 the claim being made and they should be able to

9 reasonably rely upon that.

10 MS. CARUSO: Thanks, Michael. 

11 William, did you put your name tent down, okay. 

12 It's up.

13 MR. HUBBARD: Thumb up, it's up.

14 MS. CARUSO: All right. Go for it and

15 then Suzanne and then Chris.

16 MR. HUBBARD: Great. So Michael makes

17 an excellent point because if you think about it

18 in practical terms let's say buying a stick of

19 gum.

20 If you go to the store and the

21 assumption that you are forced to make is that

22 everything that you purchase, perhaps that stick
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

91

1 of gum is no good it's on you as the consumer to

2 then prove that it's not good before you consider

3 it as something for purchase.

4 No less if you're going to buy an

5 education the presumption would be on the student

6 to assume that all opportunities are bad before

7 you then find out that it's good. You would have

8 to prove in fact that it is good before you make

9 that purchase, a burden that's simple untenable

10 for any student.

11 MS. MARTINDALE: Yes. Building a

12 little bit on what I was talking about more in

13 support of state law and also to get at Bullet 5

14 in terms of the burden of persuasion.

15 So implicit in my prior remarks I mean

16 I would say that the burden of persuasion should

17 be a preponderance of the evidence standard

18 consistent with consumer protection law.

19 And I just want to note that, you

20 know, last year the Department said that standard

21 strikes a balance between ensuring the borrowers

22 who have been harmed are not subject to an overly
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

92

1 burdensome evidentiary standard protecting the

2 federal government, taxpayers and institutions

3 from unsubstantiated claims.

4 So striking the right balance. And it

5 also would point here is as good a time as any,

6 that, you know, students are also taxpayers. So

7 I think that's really important to note.

8 MS. CARUSO: Chris. And, Stevaughn,

9 did you have yours raised? I just wanted to make

10 sure I understood that. Thank you. You'll be

11 after Chris.

12 MR. DELUCA: So I mean one of the

13 things I think in looking at the, again what

14 factors, one of the things we should consider and

15 remember is that there are multiple sources of

16 information that's not only available to students

17 but required to be provided to students.

18 And the challenge is, and again I

19 represent small schools. I mean I'm here because

20 of the American Association of Cosmetology

21 Schools. We've got 600 plus member institutions. 

22 They're all very small.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

93

1 Almost all of them are. Most of them

2 don't have attorneys on staff and compliance

3 people or they have compliance people. They

4 don't have attorneys on staff full time.

5 And so, and they're working very

6 diligently to provide the information to students

7 as required and to make sure they make an

8 informed decision. But just for example

9 graduation rates.

10 I mean some of the schools that I work

11 with are publishing at least three different

12 graduation rates because they calculate it for

13 federal standards, for IPEDs. They calculate it

14 for an accreditation standard for their

15 accrediting body.

16 And then they have state rates. And

17 each one has a different definition and it's a

18 different number as far as what's there. And so

19 my point is that, you know, while I agree

20 students should not have to make any extra effort

21 to figure out, you know, is everything that the

22 school is telling them correct.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

94

1 But recognize too I think through this

2 process is that there are multiple sources of

3 information out there and that for example or

4 it's information that may be corrected and if a

5 school is going through and updating data and

6 providing updated data to a student afterwards

7 that those things should be part of the factor

8 and part of what we're considering as far as, you

9 know, the level of harm to the students.

10 And then ultimately getting to, you

11 know, reasonable reliance on the information when

12 we're looking at assigning liability.

13 MS. CARUSO: Stevaughn and then Aaron.

14 MR. BUSH: Good morning, good morning. 

15 I've been kind of holding my tongue just a little

16 bit. I had a point to make or a question to ask

17 the gentleman who was first here this morning.

18 The Department has been talking about,

19 you know, all of the wonderful things that it's

20 doing right now to adjudicate borrower defense

21 claims and really what's been pressing on my mind

22 is what is the Department also doing concurrently
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

95

1 to make sure that students are aware of their

2 rights under borrower defense law and what's the

3 outreach looking like.

4 So if tomorrow or perhaps later today

5 I could, you know, be provided with that I would

6 be very appreciative of that information. And

7 also, you know, I think we need to put this

8 debate in a little bit of perspective.

9 So it's clear that we all want to

10 discourage predation by for-profit institutions. 

11 But it's not so clear to me that we also should

12 be encouraging truthfulness on the part of these

13 institutions.

14 We should be discouraging a kind of

15 carelessness that for-profit institutions have

16 been showing with students' futures, students'

17 ability to provide for their families by telling

18 them, you know --

19 MR. BANTLE: Stevaughn, and I

20 understand, you know, your passion for this

21 subject. Just with the limited time I want to

22 focus on getting, you know, answers to the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

96

1 questions.

2 So is there a way we could touch base

3 on your first question off line and then --

4 MR. BUSH: Yes. I can truncate it.

5 MR. BANTLE: Thank you.

6 MR. BUSH: So pretty much the crux of

7 my point I just wanted to say that, you know, we

8 should be making a claim easier rather than more

9 difficult to prove and by elevating the burden of

10 proof to a clear and convincing standard that

11 puts an unfair onus on the student.

12 So therefore I would advocate for a

13 preponderance of the evidence standard.

14 MS. CARUSO: Thank you. Aaron and

15 then Walter.

16 MR. LACEY: And I had asked and maybe

17 one of the AGs when you guys get a chance could

18 take a minute to, I had suggested maybe they

19 could talk a little bit about what the

20 differences in these standards of proof are for

21 the non-attorneys at the table and frankly for

22 the attorneys who aren't litigators.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

97

1 I think that could be helpful. But

2 the other point I wanted to make just with regard

3 to, you know, Michael had talked about this last

4 sentence should the Department consider whether

5 borrowers should ascertain the truth without

6 difficulty, inconvenience or special skill.

7 Totally appreciate the point on it,

8 consumers in the shopping sense or students not

9 having the burden of going back and proving

10 something. I think from my perspective when

11 you're talking about the standard what addresses

12 that largely is a reliance element to the

13 standard that we come up with if we had a federal

14 standard that we craft.

15 So you would have the behavior on the

16 part of the institution and then you've got the

17 damage and the student would have to establish

18 that there was some reasonable reliance. So if

19 somebody said inadvertently our placement rate is

20 184 percent and they meant to say 18.4 percent or

21 maybe that's a bad example.

22 But the point is if there was some
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

98

1 reliance that we would all agree was not

2 reasonable because it was so outlandish or

3 impossibly true that, you know, there would be an

4 opportunity for an institution to say this was a

5 mistake that the reliance there was not

6 reasonable.

7 And I think a lot of state laws,

8 unfair and deceptive practices laws and other

9 similar type standards include a reliance aspect.

10 MS. CARUSO: Walter.

11 MR. OCHINKO: So I just wanted to

12 build off of something that Michael said earlier

13 about whether or not we should consider --

14 borrower should have ascertained the truth about

15 without difficulty, inconvenience or special

16 skill.

17 And I'm looking at a catalog from a

18 formerly for-profit school that is now non19 profit. And the catalog is 456 pages long. And

20 on Page 54 there is a discussion of

21 accreditation.

22 And in bold it says if a specific
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

99

1 Herzing University program at a specific campus

2 does not state it has programmatic accreditation

3 in writing students should assume the program

4 does not have programmatic accreditation. 

5 Students should not rely on oral or unofficial

6 confirmation of program accreditation.

7 Students are responsible for

8 understanding the specific requirements of the

9 certification licensing and for eligibility to

10 sit for particular license examination of the

11 state or locale in which they want to enter or

12 practice their profession.

13 Herzing University makes no

14 representation unless explicitly written --

15 MS. CARUSO: Walter, I just want to

16 point out that it's difficult to follow when

17 you're reading from something and speaking very

18 fast. Is there a way you can summarize just what

19 you're trying to say?

20 MR. OCHINKO: Well the whole point is

21 that the university is essentially putting it

22 upon the student to make a determination
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

100

1 themselves of whether or not the school has

2 appropriate accreditation. And it's saying that

3 if somebody has told you that its accreditation,

4 it's appropriately accredited and you don't see

5 it in writing, then it's not true, don't believe

6 it.

7 But this is buried on Page 54 of the

8 catalog which has 455 pages. And so I just think

9 it is difficult for a student who usually goes to

10 a school trusting that they're doing the right

11 thing and that they're not misleading them.

12 And I just think it's worth noting

13 that it's not easy for the student who is, you

14 know, putting trust in the university or the

15 school to be honest with them.

16 MS. CARUSO: Thank you. That's much

17 easier to understand. Joseline and then I saw

18 someone. Joseline and then Linda.

19 MS. GARCIA: I do want to echo what

20 Walter said. But the other point that I wanted

21 to make is in terms of the amount of relief I

22 strongly urge us to move towards a place where we
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

101

1 are giving full relief to students.

2 Partial relief is not enough. These

3 students make tons of sacrifice to receive an

4 education and as Walter said they're coming into

5 these institutions in good faith and also to

6 receive an education.

7 And I think that often people create

8 stereotypes of students saying that they're lazy,

9 they're not trying hard enough, they weren't

10 willing to do the work and that's why they are

11 being taken for granted. But I don't think

12 that's simply the case.

13 I think there's other things related

14 to accessibility of information in terms of the

15 language and also like having the resources. And

16 so that being said there are a lot of sacrifices

17 that students make.

18 They take out private loans. They

19 sacrifice their families, their time, sometimes

20 their physical and mental health and wellbeing. 

21 And to go to partial relief I think would be

22 creating more barriers for people to receive an
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

102

1 education.

2 And I think at the end of the day as

3 we mentioned students are first. And I do

4 believe that in order for this country to prosper

5 we should be increasing the access to an

6 education and people being willing to invest in

7 their lives.

8 MR. BANTLE: Okay. Just kind of a

9 facilitator note here as we have a number of

10 hands up. If you, as we've talked about both

11 Numbers 5 and 6 if you're responding if you could

12 give us a heads up as to which you're responding

13 to.

14 We'll go Linda, Ashley Reich. I

15 apologize I don't know if, John was next. Then

16 Ashley and then Dan.

17 MS. RAWLES: It's the last one, which

18 one is that again, okay. I just want to remind

19 us that what we're looking for is something that

20 is fair and clear, right.

21 I don't think anyone around the table

22 would say let's not do something unfair or not
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

103

1 clear. So if we hold those standards in mind,

2 you know, I want to make a few comments.

3 One is that if you read one item out

4 of a catalog that's not really fair. I know many

5 clients that I have that may put something like

6 that in their catalog for legal reasons because

7 there's so much litigation.

8 But they also have checklists that the

9 advising people go through where they say things

10 much more fully. So there, you have to look at

11 the whole process that an institution has and not

12 just one particular part of that institution.

13 Secondly, if we're talking about

14 something that's fair I'm all for full redress

15 and full damages if that's fair. But we want a

16 process whereby if the Department or the fact

17 finder determines that it's not fair for full

18 redress, if it's fair if it's only partial we

19 want a rule that accommodates that.

20 So I'm only arguing for fair and clear

21 and so that would to me require partial redress

22 and that's it.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

104

1 MS. REICH: I just want to touch on

2 Abby's point that she made about the full versus

3 partial. I think we're assuming that the student

4 is staying in the same program the entire time

5 that they're there.

6 So my question is if I have a student

7 that starts out in a religion program and then

8 they switch to an education program and their

9 claim is that the, you know, education website,

10 you know, misled them in some way that they could

11 receive professional licensure in a particular

12 state I don't think it would be fair to say that

13 the student should be relieved from their

14 religion degree student loans that they took out.

15 So I think there needs to be some

16 separation there assuming because I think we're

17 assuming, like I said, that the student is

18 staying in that same program. So we need to be

19 careful with that.

20 MS. CARUSO: John.

21 PARTICIPANT: Just because AGs were

22 asked to comment about the burden of proof
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

105

1 question, basically when we talk about burdens of

2 proof we're talking about the degree of doubt

3 that in this case could be in the Department's

4 mind about the facts.

5 We're talking about the degree to

6 which they find one version of the facts more

7 convincing than another. So when we talk about

8 preponderance of the evidence it's a simple

9 finding of I think it's more likely than not that

10 the situation is as described.

11 When we talk about clear and

12 convincing evidence we talk about evidence has

13 been permitted that makes me virtually certain. 

14 There's only a very small doubt in my mind that

15 the facts would be that way.

16 In state consumer protection laws

17 acknowledging that they do differ, I would say in

18 general probably bodies of consumer protection

19 law preponderance of the evidence has been

20 sufficient in most states at least for the

21 baseline claim and not for exemplary damages.

22 But there are definitely situations
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

106

1 especially where specifically fraud is alleged

2 where clear and convincing evidence is the

3 appropriate standard. So hopefully that's of

4 some use to anyone in the room who is fortunate

5 enough not to be a lawyer.

6 MR. BANTLE: Thank you, John. Ashley.

7 MS. HARRINGTON: Would also support a

8 preponderance of the evidence standard. And I

9 think we should start from an assumption of full

10 relief. That should be the base line assumption

11 is that the student is going to get full relief.

12 And I think also we want to move away

13 from any standard or system that puts the

14 responsibility of policing schools on students. 

15 The responsibility of policing schools should be

16 the Department and other regulatory agencies.

17 That's it. That's where the money is

18 coming from. That's who has the resources to

19 police these schools, not students. And we need

20 to remember that. These are not students who

21 have unlimited resources.

22 They used all their resources to go to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

107

1 school to begin with. So when we put and we gave

2 them the seal of approval. We told them, you

3 know, this is a university. You get federal

4 funding to go here.

5 So this must be somewhere where you

6 can get an advantage up in life. Higher

7 education is the way to get a better life. And

8 we give them federal money to do that

9 So the job of policing schools should

10 never be on the student. It should be on the

11 Department to create rules and regulations that

12 make sure that this does not happen to more

13 students.

14 MS. CARUSO: Okay. We're going to

15 play a little bit of tennis. It's Abby, Dawn,

16 Joseline and then back to Kelli.

17 MS. SHAFROTH: Thanks, John, for

18 talking us through the preponderance of the

19 evidence versus clear and convincing. With

20 John's explanation in mind I would offer to the

21 group that to the extent the Department finds

22 it's more convincing to it that the student is
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

108

1 telling the truth that they were scammed into

2 taking out federal loans that it is more likely

3 than not that is true, I would suggest this group

4 should agree that the Department should not

5 continue to try to collect on those loans then if

6 it believes that the student likely was scammed

7 into taking them out.

8 So I think that's an appropriate

9 standard. It's also from a practical standpoint

10 a standard that the Department is already

11 accustomed to applying.

12 It's the standard that the Department

13 uses in other proceedings regarding borrower debt

14 as was pointed out in 2016 including, I believe

15 wage garnishment hearings. So it's something the

16 Department is practiced at doing.

17 And I should say, I'm referring on

18 that point to a document that the legal

19 assistance community put together sort of

20 annotating these issue papers with information

21 that the Department previously provided mostly in

22 the context of last year's rulemaking because I
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

109

1 think it's a helpful starting point for

2 understanding sort of where the Department came

3 out before.

4 I asked for these to be distributed

5 because I had shared them with some folks already

6 and I didn't want to have them, some people have

7 the information and some people not. I want us

8 to have a common framework.

9 I don't know if they've already been

10 shared or --

11 MS. CARUSO: They have not been

12 shared.

13 MR. BANTLE: We still have them.

14 MS. SHAFROTH: Okay. So I have a

15 request to share them. I will touch base with

16 the moderators about that.

17 On the amount, determining the amount

18 of relief I agree that the presumption should be

19 full discharge of the federal student loans that

20 are related to that, to the program where there

21 is the misrepresentation.

22 So I think that can be consistent with
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

110

1 the point about their, you know, if there is, if

2 a student was misled into taking out loans with

3 respect to one program but not another then it

4 might be certainly appropriate just to get relief

5 with respect to the program where there is the

6 misrepresentation.

7 To me that doesn't necessarily mean

8 partial relief. That just means relief on the

9 loans related to the misconduct. And I'm, I

10 would counsel against setting up any rule where

11 we say, you know, if a student was still able to

12 get a job or that sort of thing, try to say that

13 they then weren't harmed.

14 You know, all the student borrowers

15 that I work with are working as hard as they can

16 to find employment to be able to provide for

17 their families especially the Everest borrowers

18 that I've worked with have said often it was a,

19 having that on their resume made it harder for

20 them to get a job.

21 So to the extent that they are still

22 able to get a job notwithstanding having gone to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

111

1 a program rather than because they have gone to a

2 program they've still suffered harm in taking

3 out, you know, say $10,000 of debt to go to a

4 program that is not helping them advance their

5 career, that is not helping them earn more money.

6 So I wouldn't want us to say that just

7 because someone gets a job at the end of the day

8 that they weren't harmed.

9 MS. CARUSO: We're going to go to

10 Dawn. But I would ask for no new name tents at

11 this time. Let's get to the ones that are

12 currently up and then we're going to have a check

13 in. So, Dawn, please.

14 MS. ROBINSON: So my response is to

15 Number 6. Should the Department consider the

16 borrower's actions or circumstances when

17 determining the amount of relief and should the

18 Department consider whether the borrower could

19 have ascertained the truth without difficulty,

20 inconvenience or special skill?

21 One of the things that I would like

22 the committee and the Department to realize is
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

112

1 when you're dealing with accreditation, when

2 you're dealing with fiscal issues such as going

3 concerns students aren't going to know these

4 things.

5 Audits of financial statements are

6 private unless you are a governmental entity. 

7 And then a student still has to know to go to the

8 State Examiner's Office or another governmental

9 entity to look for those types of issues.

10 So I don't think it's fair to put that

11 burden on a student. Then when we start talking

12 about timeliness. So a student enrolls in a

13 program. The program has not been accredited.

14 They don't know that the program has

15 not been accredited until it's time for

16 graduation right. So you've got a state agency

17 that has the authority to determine or make the

18 determination that, yes, this is accredited

19 program and they don't know.

20 Again, we go back to all of these

21 different agencies that you're saying that a

22 student should understand the complicities of. 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

113

1 EZ audits for DOE, federal clearinghouse, state

2 regulation agencies, state examiner's agencies,

3 then whomever is auditing the financial

4 statements.

5 So I would just ask this committee to

6 keep in mind that placing that burden on a

7 student is not only cumbersome but it's very

8 unfair because most of the people sitting in this

9 room don't even understand those complexities

10 unless you are a CFO like myself or a president

11 or someone else that is in a cabinet position

12 that is paid to know these things.

13 MS. CARUSO: Thank you. Joseline.

14 MS. GARCIA: You know, I just want to

15 appreciate what Dawn and Ashley mentioned

16 earlier. I'll just make this brief. We keep

17 throwing around the words like fair and clear in

18 terms of making this rule.

19 But the reality is that the situation

20 that students are in is already like unfair. It

21 is a David and Goliath situation. And we're

22 asking students to go against these massive
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

114

1 institutions.

2 I mean I'll just quickly relate it to

3 like a basketball example. Does everybody here

4 know who Stephen Curry is?

5 PARTICIPANT: Never heard of him.

6 MS. GARCIA: Really, you know, I am

7 5'2". I am a soccer player and a track runner,

8 not a basketball player. If I'm put up against

9 to go against a game around Stephen Curry,

10 someone who is trained, someone way taller than

11 me, someone who has the resources to beat me

12 there is no way that, you know, it's going to be

13 a long shot for me to win.

14 And so, you know, I want to use that

15 analogy like in this situation. It is a long

16 shot for many of these students. And I think

17 creating more barriers is not the place that we

18 want to go.

19 And I know that we keep talking about

20 having a fair and clear. But the situation is

21 that it is very unfair for a lot of students

22 right now.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

115

1 MS. CARUSO: Thank you. Kelli.

2 MS. HUDSON PERRY: I just want to

3 comment briefly on Point 6 asking should the

4 Department consider determining the amount of

5 relief the borrower should receive. And this

6 kind of echoes what Ashley was saying.

7 I think that there should be some

8 consideration in the fact that if a student has

9 actually earned credits at an institution and

10 they're able to transfer those credits to another

11 institution they probably shouldn't be relieved

12 of the debt as it relates to those credits that

13 were transferred, because they are continuing

14 their degree somewhere else.

15 MS. CARUSO: Dan.

16 MR. MADZELAN: I just had a question

17 to clarify, maybe help the Department. When

18 we're talking about complete or full relief is it

19 contemplated that would also include refunds of

20 amounts already repaid on those loans?

21 MS. CARUSO: Department, do you have

22 a direct response to that question? Okay, we're
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

116

1 going to hold comments for a minute. I just want

2 to get to everyone. Walter?

3 MR. OCHINKO: Yes. I just wanted to

4 support what Ashley said earlier about students

5 versus agencies that actually regulate the

6 schools.

7 We work with a lot of veterans that

8 have gone to for-profit schools and that come to

9 us to help address some of the misrepresentations

10 that they encountered. And one of the things we

11 often hear from these veterans is, you know, why

12 did VA let me use my benefits at this school?

13 And when we say this to VA they say,

14 they point the finger to Ed and say and the

15 accreditors, well it's accredited and it

16 participates in Title IV. So we view that as the

17 seal of approval and clearly it's not.

18 MS. CARUSO: Okay. I just want to

19 turn it over to the Department for a moment. A

20 couple of questions. How are we doing? Where do

21 you need more discussion? Where do we need more

22 discussion with the amount of time that we have?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

117

1 There is an interest to get to all

2 eight of these issues. We just want to

3 understand, you know, how much more discussion we

4 need and where.

5 MS. WEISMAN: So I think for the most

6 part we've covered the issues that we would like

7 to cover here. I think there are two somewhat

8 minor points which again depending on the

9 reaction that we get that may take up some time.

10 But I think it's worth doing. We

11 would like to hear a little bit more about if

12 somebody is in favor of partial relief how would

13 they envision determining how to calculate what

14 that relief would be.

15 And I think also we would like to

16 follow up a little bit more on the question that

17 Dan had just posed regarding refunds of amounts

18 already paid. That's on the table for

19 discussion.

20 So if it's something that you're

21 interested in speaking out about we would like to

22 hear the opinions about those two issues.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

118

1 MR. BANTLE: Okay. So while the group

2 thinks about those two issues Mike did have his

3 tag up. I know we've talked about a lot of

4 things. So if you could kind of give us a sense

5 of what you're commenting on.

6 MR. BUSADA: Yes. Just in terms of

7 all this I just, I have to respond to this

8 because for the 100 students that are sitting in

9 my school right now this continued talk about

10 for-profit schools that's hurting their

11 graduating chances because when they go to and

12 apply for a job we've got people just saying that

13 everybody is all lumped in together.

14 So they're going to have a harder time

15 because we continue to say that everybody there

16 is bad. I can tell you I've worked in all

17 industries. There is no industry that has no bad

18 actors.

19 And quite frankly, in the public

20 sector they have immunity in most cases. Talk

21 about fighting Goliath. The State of Louisiana,

22 the government their resources are much bigger
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

119

1 than our little bitty resources with 100

2 students.

3 They've got the whole powers of the

4 state government. So try to sue LSU. So come

5 on, let's just be fair with everybody and let's

6 not just say that everybody is bad. I guarantee

7 you there is good and bad everywhere.

8 Let's get rid of the bad and support

9 the good regardless of what a tax status is.

10 MR. BANTLE: Okay. I think you

11 addressed the concern about kind of the labels

12 being used there. First, let's break this into

13 two parts. And let's start with comments on the

14 partial relief question raised by Annmarie.

15 Okay. So I'm assuming if you put your

16 tag down you were thinking about the other

17 aspect. So we'll start with Alyssa and then

18 we'll go to the back of the room and Ashley Reich

19 has her up as well. So we'll go front, back,

20 front.

21 MS. DOBSON: I was going to comment on

22 both things. So can I do that quickly as long as
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

120

1 I'm brief?

2 MR. BANTLE: Just to kind of keep the

3 arc of it we'll keep your tag up. But could you

4 just do part.

5 MS. DOBSON: All right, okay. So then

6 the first thing you want is the partial. I think

7 that it just makes sense, you know, even thinking

8 from the student standpoint and the school

9 standpoint that the relief should be attributed

10 to the misrep.

11 And so if you do have loans that come

12 from perhaps two different schools or two

13 different programs that the relief should pertain

14 to how you were wronged, if that makes sense. So

15 in my mind and I think somebody up there said it,

16 it wouldn't actually be partial relief.

17 It would be full relief for the

18 damages. Does that make sense to everybody? 

19 Okay. And then I'll just leave my card up for

20 the other question.

21 MR. BANTLE: Aaron.

22 MR. LACEY: Just a couple of comments
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

121

1 on the partial relief concept. I mean the first

2 is, you know, I think, I'm not sure I understand

3 why we would want to hem in administrative law

4 judges or hearing officials from having the

5 opportunity to grant partial relief.

6 And I think there is a danger. I

7 understand wanting to start there from a consumer

8 advocacy standpoint. I do think there's a danger

9 of that cutting, that sort of cutting both ways.

10 If you hem in hearing officials so

11 that their only option is to grant complete

12 relief I could see the idea that the standard

13 that has to be satisfied is higher or a

14 reluctance potentially to grant relief because

15 the understanding is I can't grant $5,000 or

16 $7,400 for a small infraction. It's all or

17 nothing.

18 So I just, I think that's something

19 worth considering. You know, I also think there

20 is a concept as the Department and I'm sure most

21 folks here know in the closed school loan

22 discharge, you know, there is this idea that if
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

122

1 you have your credits and even if your school

2 closes and you would be eligible for a closed

3 school loan discharge, you know, if you have your

4 credits and you could take them somewhere else to

5 complete your degree you're no longer eligible.

6 And clearly the philosophy there is

7 well you've been able to make use of what you

8 used the loan for at the original institution. I

9 mean Ashley pointed at this and I think it is

10 certainly something we could consider here.

11 I'm not exactly sure how it would

12 work. But it does seem to me that if there is an

13 act or omission of an institution and it occurs

14 at a point, you could see a couple of scenarios. 

15 One would be where let's say you got,

16 and by the way let's just assume this is an

17 institution that is not a for-profit but a

18 respected public or private non-profit

19 institution where we all think they do a great

20 job and offer degrees of high value.

21 You know, let's say there's an act or

22 omission on the part of an individual of that
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

123

1 institution in the last semester of an eight

2 semester program, right. Student has no issue

3 with the education it was provided in the first

4 seven semesters.

5 There is no one that raises a

6 question. But there was something that occurred

7 in that last semester that impacted the quality

8 of education in the last semester and we think

9 there should be relief for loans that apply to

10 that semester.

11 I would think you would want an ALJ or

12 a hearing official to have the flexibility to

13 grant that student some relief. The other

14 question I have is if you have someone who has

15 graduated and, you know, this is a little

16 distinct.

17 I'm not talking about the situation

18 where we're saying the student has to prove that

19 they couldn't have overcome the misrepresentation

20 or whatever. What I mean is if you have a

21 situation where a student graduated from an

22 institution and they are claiming the degree and
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

124

1 all of the credentials and they have put that

2 degree on their resume and they have secured a

3 job in part on the basis of that degree being on

4 their resume and they're three years out, and

5 again, this is not a for-profit institution.

6 Hypothetically this is a great private

7 non-profit with a high quality degree that

8 everybody agrees to and has a superb reputation,

9 right. And then that person says, identified

10 something and I believe it's, you know,

11 represented an act or omission at some point late

12 in my program, right.

13 There ought to be some way to consider

14 the fact because institutions I mean the widget

15 they produce are the credits and the credential,

16 right. That's the thing that they have to offer

17 when you're talking about what is their widget,

18 right.

19 Well in that case the graduate has

20 made full use of the widget and is still claiming

21 rights to keep the widget, right. They're not

22 surrendering their credential. They're not
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

125

1 surrendering the credits.

2 And I think it's problematic that they

3 are seeking to discharge the loans that they used

4 to finance the cost of the widget but they get to

5 continue to keep the full widget and also benefit

6 from the value of having it.

7 So all of this is just to say I mean

8 I think there are very real and fair reasons to

9 try to at least consider a mechanism that would

10 permit a hearing official to try to draw a line

11 and take those types of things into

12 consideration.

13 MR. BANTLE: Okay. And the last on

14 the partial relief up to Ashley Reich.

15 MS. REICH: Just on some ideas for

16 calculation. Aside from what I've already stated

17 you could possibly look at tuition and fees for

18 that program for the misrepresentation claim to

19 try to calculate some sort of an amount.

20 And obviously look at the loans that

21 were taken out for that particular program. I

22 think that would also allow for some sort of due
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

126

1 process at the institution where the Department

2 would then come back to the institution for

3 information.

4 And right now that's not really in

5 place. And so we would like to ensure that there

6 be some sort of due process where the institution

7 could have a voice for what, you know, first of

8 all the program that the student states that they

9 had some sort of misrepresentation for.

10 And then discuss, you know, the costs

11 associated with that program.

12 PARTICIPANT: Just want to comment on

13 the notion of basing partial relief, if that is

14 the collective consensus, on the tracking of

15 transfer credits which are a distinctly useless

16 proxy, I think for what you are looking for, for

17 various reasons.

18 Not least of all I want to remind

19 people that very frequently we end up serially

20 victimizing people. The Department of Education

21 facilitated placement of Corinthian students with

22 ITT blocking them from discharging the Corinthian
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

127

1 debt they had accumulated only to be victimized

2 even to a greater extent in the hands of another

3 subpar provider.

4 So that's one. Secondly, keep in mind

5 that the notion of transferring credits is a very

6 amorphous and ultimately meaningless concept

7 because you can take a lot of credits without

8 expediting time to degree.

9 And in fact given the unpleasantness

10 of telling people you're not going to take their

11 credits many institutions will simply nod and

12 accept the credits and you still have just as

13 many credits left to go to obtain the credential

14 in question.

15 So it's just not a robust, you know,

16 I'm not speaking against partial relief. But I'm

17 just pointing out that if you think you have a

18 good proxy for what the metric for it should be

19 transfer credits are not the right one.

20 MR. BANTLE: Any other comments on

21 partial relief? Partial relief, okay.

22 PARTICIPANT: Well it was just like a
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

128

1 response to Aaron. You know a question to think

2 about is how do we prove that the graduate has

3 made full use of the degree.

4 So I would just like ask folks to like

5 ponder about that as we continue forward.

6 MR. BANTLE: And, Alyssa, I think

7 you're coming back on partial relief.

8 MS. DOBSON: Yes, just to I guess add

9 some information or perspective with regard to

10 transfer of credit is that I don't think a

11 student would be prepared or have the knowledge

12 to know how to go about that.

13 Meaning they're, if we include

14 transfer of credit in some sort of calculation of

15 partial relief then they're going to have to do

16 an evaluation of is it worth transferring the

17 credits to this new program or not asking for the

18 transfer of credit to occur.

19 And I think that's not reasonable to

20 require a student to know in order to avoid harm

21 with regard to the process.

22 MR. BANTLE: Real quick, okay.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

129

1 PARTICIPANT: I don't disagree. I

2 don't think the transferability of credit and

3 whether they can transfer is a great idea because

4 that's totally in the control of the receiving

5 institution.

6 It's just, I don't think, my point is

7 if the student wants to keep the widget and the

8 student has 100 percent control over whether or

9 not they are claiming those credits and whether

10 they are going to claim the credential.

11 So if they want to say I don't want

12 the credits, I don't want the credential then

13 they're giving back the widget. But if they're

14 going to keep the widget which means, for

15 whatever use transfer of credit, to hold it on

16 their resume, you name it.

17 But if they're going to keep the

18 credits and they want to hold onto the credential

19 and be able to try to use it, right, then they're

20 keeping the widget. And I think in that case

21 you've got to have, there's got to be some

22 conversation because you can't give them the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

130

1 money back and they get to keep the product.

2 MR. BANTLE: Okay, on, okay.

3 PARTICIPANT: Just to follow up on the

4 transfer of credit. And I guess I'm coming

5 possibly from a different perspective, not a for6 profit. I'm coming from a non-profit, private

7 institution perspective, okay.

8 If you have a student that has made it

9 through two years of their degree, has received

10 loans for those credits and decides that they're

11 going to transfer and has a misrepresentation

12 claim there is a very good chance that the new

13 institution is going to accept all of those

14 credits.

15 So if you don't consider transfer of

16 credit you're basically saying we're going to

17 give you those two years for free assuming that

18 student used loans in order to pay for those

19 credits. They're going to transfer them and they

20 could potentially graduate with a four year

21 degree at the cost of two.

22 MR. BANTLE: On transfer of credits,
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

131

1 okay. Last comment and then just to give the

2 Department a heads up I'd like them to kind of

3 frame our second issue.

4 PARTICIPANT: I guess my only

5 observation, I've been working at state systems

6 for the past 12 to 15 years is it can get quite

7 complex with transfer of credits and what slots

8 into a degree program versus just accepted as a

9 transfer and I think that's an important issue

10 there, you know, just as far as when you look at

11 it whether it's actually counting for the degree

12 the student is looking for or it's just accepted

13 and it's just sitting on a transcript and piling 

14 up more credits.

15 MR. BANTLE: And I will readily admit

16 a facilitator mistake. Ashley had her tag up

17 before I called. Is that on transfer of credits

18 or on the second issue?

19 Okay, on the transfer of credits we

20 can jump, save the refunds until after kind of

21 the Department frames it. But we'll go Ashley,

22 Abby and then to the Department.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

132

1 MS. HARRINGTON: Well mine was about

2 partial relief. I just want to be careful that,

3 the statute says that the Department can't give

4 relief beyond the loans that were taken out.

5 But the students don't get their time

6 back. They don't get back the other costs they

7 had to use when they were in school getting a

8 degree that they can't use.

9 The, anything that happened to their

10 family, any other thing. So we're already

11 limited to the amount of relief. And I'm not

12 saying that's wrong. I think that's fine.

13 But we can't just say just because

14 they're getting their money back they are

15 restored to where they were before. Whether they

16 cite the degree or anything like that we can't,

17 that's not the same thing.

18 MS. SHAFROTH: I think that's mostly

19 the point I wanted to make. And also in terms of

20 the sort of giving the widget back, I mean I

21 don't know how that would work in practice if

22 someone actually did complete a program that
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

133

1 induced them to enroll based on

2 misrepresentations.

3 If they complete the program I don't

4 think that you can sort of like give it back. So

5 I don't understand that proposal.

6 MR. BANTLE: Briefly and then to the

7 Department to frame our next question.

8 PARTICIPANT: You can't take back the

9 education. They get to keep that. But if you

10 cannot certify that, you don't issue a degree. 

11 You don't verify that those credits were received

12 if there's a transcript request for an official

13 transcript you don't provide it.

14 So, you know, the institution would,

15 I'm not saying this is right or wrong I'm just

16 saying as a practical explanation. You're right. 

17 They still get the education.

18 So there is a wash here, right. I

19 mean there's costs that they don't recover. 

20 There are benefits that they still receive. But

21 in terms of and this was a partial relief point,

22 right.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

134

1 I mean my point was if a student

2 wanted to come and say I don't want any of this

3 then I think that gives additional credence to

4 the idea that there should be full relief. But

5 if a student says you know what I want to keep my

6 two years' worth of credits and I do have an

7 institution that's going to accept them or

8 whatever because I don't want to mire in the

9 transfer of credit.

10 But the point is they want to keep

11 that. Then I think that's a basis potentially

12 for partial relief. And my point is just that

13 this might be a mechanism somehow looking at what

14 the student wants to keep out of the relationship

15 to determine what would be a way to measure

16 partial relief.

17 And I think there is a way that

18 functionally that would work with an institution.

19 MR. BANTLE: Okay. Can the Department

20 kind of frame our second question here for us?

21 PARTICIPANT: So this is in response

22 to the issue that Dan brought up, his question
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

135

1 about should we look into refunding amounts

2 already paid. So not just looking at amounts

3 that are still owed on a loan, but if a discharge

4 is given what is the groups feeling about amounts

5 already paid.

6 MS. MILLER: So, Alyssa, I think you

7 were first and then goodness, then we'll go back

8 to Abby, Michale, Ashley Reich and then William,

9 I'm sorry.

10 MS. DOBSON: So the answer that I

11 would give is a resounding, yes. I think that

12 should be restored. A student who is dedicated

13 to a responsible loan repayment process versus

14 one who either wasn't or couldn't repay their

15 loans based on any certain circumstance.

16 Loans get repaid based on family help,

17 on taking on second jobs, on the fear of

18 repercussions of default and delinquency and

19 accruing interest and not, just the uncertainty

20 and the length of time with which the processes

21 take loan amounts are going to vary based on

22 numerous different factors.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

136

1 And I think it would be grossly unfair

2 not to give the money back to a student who did

3 everything that they could in order to pay down

4 those loans. And then briefly because somebody

5 had mentioned relief not just for amounts already

6 paid but also for amounts that were refunded to

7 the student for educational costs not directly

8 related to billable charges.

9 And I do think that those need, would

10 need to be included as well because there's a

11 reason that we have a federally defined cost of

12 attendance and that is to provide the resources

13 for those students to earn the education whether

14 it's a billable charge or not. And that is still

15 resources that were dedicated to a program or a

16 school that, you know, misrepresented the program

17 in the first place.

18 PARTICIPANT: Yes, that covered my

19 point about refunds of amounts already paid. 

20 MS. MILLER: Okay, Michael.

21 MR. BOTTRILL: So, Annmarie, just so

22 that I understand the statute, it does say that
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

137

1 there is an opportunity for the borrower to

2 recover amounts that have already been repaid on

3 a loan. Is that correct? Am I reading that,

4 it's in your Issue Paper Number 1.

5 MS. WEISMAN: Yes.

6 MR. BOTTRILL: Right. So if it's

7 contemplated in the HEA then doesn't it stand to

8 reason that there is some will on the part of

9 Congress that refunds or amounts already paid on

10 a loan should be contemplated for relief in this

11 particular circumstance?

12 MS. WEISMAN: I think it has been

13 contemplated and we're looking here to get your

14 feedback and the groups discussion of that issue

15 in terms of again, if the group is in support of

16 that. If so, how?

17 Any comments that you have. Dan

18 raised the issue and we didn't want it to kind of

19 get away from the group if it was something that

20 you wanted to provide feedback on.

21 MR. BOTTRILL: I'm just, why is it a

22 question? If it's in the HEA I'm just wondering
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

138

1 why it's a question? 

2 PARTICIPANT: No, it's simply a

3 thought that occurred to me when Joseline

4 mentioned the, you know, the complete relief. 

5 And I, you know, I had in my head, you know, what

6 does complete mean.

7 You know, outstanding amounts or

8 something in addition to that. I wasn't, you

9 know, I wasn't paying a lot of attention to the

10 2016 effort.

11 So I didn't know if that had been

12 addressed as part of the previous committee

13 meetings. So again, it was something that just

14 occurred to me and I raised it.

15 PARTICIPANT: So it looks like then

16 the current borrower defense process allows for,

17 you know, when there is a cause of action or

18 something that would give rise to a cause of

19 action that a claim can be made and that the HEA

20 already contemplates that not only is it for

21 outstanding amounts but also for amounts already

22 previously paid for the student to be able to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

139

1 recover those amounts.

2 I'm just trying to frame it up for my,

3 that's how we, what's currently allowed for. Is

4 the question from the Department that particular

5 provision in the HEA is not articulated in the

6 regulations?

7 MS. WEISMAN: It seems to us that the

8 statue directs us to regulate in this area and so

9 we're just trying to have as rich of a

10 conversation as we can have around it.

11 PARTICIPANT: So again my question is,

12 is that particular part of the HEA not currently

13 contemplated within the regulations, the

14 repayment piece for amounts already paid?

15 MS. WEISMAN: I think that the

16 language that we're looking at, Caroline had

17 pointed out the way it's specifically worded is

18 further relief. And so we just want to make sure

19 we have as rich of a conversation and we get the

20 sense of the group to make sure that we're

21 including everything that we should include.

22 So I don't think that you should look
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

140

1 at it as any indication that we aren't planning

2 to go there, so to speak. It's more that we're

3 trying to address the question that was already

4 put on the table by another negotiator and we

5 just want to make sure we have the flavor of the

6 group.

7 And maybe the faster way to do it is

8 to do a quick temperature check if that's all

9 right to just get a sense of where we all are on

10 this issue and then we can go ahead and move on.

11 PARTICIPANT: Can I just ask one more

12 question? So I understand that. I guess what

13 I'm getting at is in the regulation, the current

14 regulation under 685.206 states that the borrower

15 may assert as a defense against repayment.

16 Does the Department view that as a

17 delimiting factor for a student's opportunity to

18 recover money that's already been repaid against

19 a loan because you only talk about a defense to

20 repayment.

21 PARTICIPANT: Well and that issue has

22 been raised previously. And I think that's why
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

141

1 we want to consider for any language that we're

2 writing something that's very specific about what

3 the intent is to make sure that we've covered all

4 of our bases.

5 PARTICIPANT: Thank you. That's what,

6 exactly what I'm thinking. Thank you.

7 MS. CARUSO: All right. So if we

8 could just keep it the cards that are currently

9 on the table and then we're going to move to the

10 temperature check that Annmarie is referring to.

11 And if you would be thinking about how

12 you want to frame it, Annmarie.

13 MS. MILLER: So, Ashley Reich.

14 MS. REICH: Some of mine is echoing

15 what Alyssa already mentioned. But I think all

16 of us are well aware that we have a very large

17 student loan debt problem, 1.3 trillion and

18 growing, right.

19 So I also know that there are a lot of

20 institutions that have implemented financial

21 literacy programs across their campus and many

22 others that are looking to do the same. And I
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

142

1 feel as though if we do not allow for some of the

2 money that has been repaid to be a part of this

3 that flies in the face of what schools are trying

4 to do to educate their students financially about

5 how to properly pay their loans back.

6 And so I also am aware that in some of

7 the reauthorization process of the HEA that's

8 taking place I believe now, there is going to be

9 possibly some language in there about encouraging

10 institutions to put financial literacy programs

11 in place.

12 And I think that's very important to

13 remember that, you know, there are schools that

14 are trying to do that. So we need to have that

15 as part of the discussion.

16 PARTICIPANT: The Undersecretary this

17 morning referenced quite specifically that there

18 was an intent on the behalf of the Department to

19 offer potentially relief on interest on loans

20 which were adjudicated as a no claim on the

21 interest that had already been paid.

22 I think consistent with that
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

143

1 supporting the relief in this case for students

2 would make sense to us and we would applaud that

3 rule. I want to touch briefly on the partial

4 stuff that I didn't get to that my colleague, Mr.

5 Lacey had mentioned very quickly.

6 I think you made a compelling point

7 about seven out of eight semesters being good. 

8 Then considering relief for that eighth semester

9 that was not good.

10 Although I would say on the point of

11 assuming the value of a degree I think that's in

12 some cases regardless of the type of school

13 perhaps misstated and can point to the fact that

14 there's probably no doubt several thousand

15 Corinthian widgets floating around that people

16 would like to relieve themselves of.

17 MS. MILLER: Valerie.

18 MS. SHARP: I just wanted to speak to

19 the refund of the prior loans paid. I strongly

20 support that. And I do agree with Alyssa in that

21 if there is extra cost that the student incurred

22 related to their education that they used loan
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

144

1 money for that was a valid educational concern

2 that we should consider that.

3 And I do not know exactly how we could

4 delineate that. But I think we do need to

5 consider especially since we're asking

6 institutions to possibly have skin in the game

7 and repay these loans to the government on behalf

8 of the student that there are many times where we

9 have students who we have counseled and honestly

10 almost begged not to take loans they did not need

11 however they chose to do so because the new car

12 at the lot down the street was very tempting that

13 now we're going to ask schools to repay those

14 loans and in essence pay for things that students

15 decided they needed that weren't tied to the

16 requirements for education.

17 Most of our student do not do that

18 just like most schools do not defraud students. 

19 But it does happen. And I think we have to be

20 really careful and I don't know how you can do

21 that.

22 But we have to be careful to protect
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

145

1 institutions because institutions do not have

2 options to tell students they cannot take their

3 loans that they opt to take and it does happen

4 where we have students who do have opportunities

5 through scholarships or even VA payments who are

6 taking out massive loans that we recommend

7 strongly they do not take.

8 And then they do so and we see, we

9 kind of see the results of that. And so I don't

10 know how, as a committee I don't have an answer

11 to that.

12 But I do think we need to have a way

13 to delineate between the necessary educational

14 expenses that students are taking loans out for

15 and those expenses which they just opt for, for

16 consumer spending that they're using their loans

17 for that we can't protect them or ourselves from.

18 MS. MILLER: Suzanne.

19 MS. MARTINDALE: I just wanted to make

20 this quick point since it actually has not come

21 up yet. Correct me if I'm wrong, but in last

22 year's regs there was a statute of limitations
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

146

1 applied on debts that were already paid.

2 I believe that's right. So I think

3 it's important to note that we would strongly

4 urge no statute of limitations on being able to

5 assert a claim regardless of whether the debt has

6 already been repaid because there is no federal

7 statute of limitations on collecting the debt.

8 MS. MILLER: Thank you. So that was

9 all the cards that was up at that time. As Moira

10 said we now want to turn it over to the

11 Department to sort of frame how you want us to do

12 the temperature check.

13 MS. WEISMAN: I have not heard any

14 opposition to the idea of refunds of amounts

15 already paid. So if we could just get the quick

16 thumbs up.

17 There may be some that I did not see. 

18 So if we could get a quick kind of thumbs up,

19 thumbs in the middle, thumbs down that would be

20 helpful to us. And then if there are people that

21 oppose it would be helpful to hear that

22 perspective as well if that's something that we
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

147

1 could consider.

2 MR. BANTLE: And a comment prior to

3 the thumbs up, okay.

4 PARTICIPANT: I was going to bring up

5 the statute of limitations issue and just clarify

6 if we were considering one and because she said

7 that they would favor no statute of limitations.

8 Some of us would be all right with the past loans

9 if there were a statute of limitations because I

10 fear, you know, just an overload of claims that

11 will never get through.

12 And I don't think it's fair to

13 institutions not to have some type of statute of

14 limitations.

15 MR. BANTLE: One last comment before

16 the thumb check, two, sorry. I didn't see both

17 tags went up. That will be this afternoon.

18 PARTICIPANT: So I just wanted to

19 raise again that someone made this point earlier. 

20 We are currently I understand talking about the

21 process for borrowers to get relief from the

22 Department of Education on whether they have to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

148

1 repay their loans or can get refunds, not about

2 whether schools should be liable or whether the

3 Department can recoup from the schools.

4 So not having a statute of limitations

5 that applies to borrower's ability to get relief

6 on their federal student loans doesn't

7 necessarily mean anything about when, you know,

8 whether institutions would continue to be liable

9 or whether institutions could have a separate

10 statute of limitations.

11 PARTICIPANT: I think as long as

12 students can be on the hook for loans until their

13 last breath there should be no reason that they

14 shouldn't also have that same burden lifted off

15 of them to not have those loans.

16 MR. BANTLE: Okay. Thank you,

17 everyone for the comments. I think it's time for

18 the show of thumbs.

19 And as I as the facilitator kept

20 letting comments in, Annmarie, can you just state

21 the test of thumbs just so it's in everyone's

22 mind and we'll get a show of thumbs?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

149

1 MS. WEISMAN: So again, it seems as if

2 most of the group was in favor of the idea of

3 refunding amounts already paid. So if you are in

4 agreement with that if we could get a thumbs up.

5 If you are unsure, thumbs in the

6 middle. And if you are opposed thumbs down just

7 to give us a sense of whether this is truly

8 something that everybody is in agreement with.

9 MR. BANTLE: Okay. And I see, okay,

10 I see no thumbs down in the room. A couple

11 sideways just to note that for the record. Okay.

12 Just a facilitator note here, it is

13 11:48. We have promised to be respectful of

14 breaks. Noting that in this area 12:00 is a busy

15 time and you generally want to break before, you

16 know, or after, does the group have a preference

17 on how we proceed?

18 Should we introduce Issue 2 and give

19 you all time to think about it and maybe have a

20 discussion until 12:15 or so or would you like to

21 break now and come back a little earlier than

22 1:00?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

150

1 Okay, I'm hearing a lot of break nows. 

2 So let's take a break, our typical hour. So

3 we'll be back at 12:50. And at that time the

4 Department can kind of give us a sense of Issue

5 Paper Number 2. Thank you.

6 (Whereupon, the above-entitled matter

7 went off the record at 11:48 a.m. and resumed at

8 12:50 p.m.)

9 MS. CARUSO: Okay, everyone. We are

10 going to get started for the afternoon session. 

11 Just as we are settling in and getting started,

12 good, as we are getting in and getting started

13 there was a document that Abby referred to

14 earlier that she would like to make available for

15 the group.

16 And what I've asked Abby to do is just

17 to give you some context, talk about who authored

18 this document. And as we look to provide

19 documents to the group for its consideration

20 throughout the next day and a half I would like

21 to make sure that we have either a title or

22 context, an explanation of who created that
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

151

1 document where it comes from. So, Abby, please.

2 MS. SHAFROTH: Sure. Thank you. So

3 the document is perhaps in front of you or being

4 passed around. It's just, we took a, we being

5 members of the legal assistance community largely

6 myself and Eileen Connor from the Project on

7 Predatory Student Lending worked together to look

8 through last year's notice of proposed rulemaking

9 and final rules the way the Department addressed

10 and resolved some of these issues last time and

11 some of the factual findings and rationales.

12 And so we just excerpted those and

13 quoted them with citations to where those points

14 were made where they seemed to be responsive to

15 the issues that have been teed up in these issues

16 papers. So we basically took direct copies of

17 the issue papers presented and put in points that

18 we thought were potentially interesting or

19 relevant from the Department last go around.

20 And I just wanted to, I just asked for

21 it to be distributed because I had already, I had

22 been referencing it for my own like use. I think
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

152

1 it's useful to see sort of how these things were

2 resolved last time as a reference point and I had

3 shared copies with a few negotiators and I didn't

4 want some people to have it and some people not

5 to have it.

6 So use it, don't use it. But it's in

7 your hands.

8 MR. BANTLE: Okay. Second, we have a

9 lot of work to be done. We have roughly 20

10 issues in Issue Papers 2 through 8 and we have

11 one issue remaining in Issue Paper 1 that we have

12 to get through that we'll have the Department

13 frame up the discussion on when we get started.

14 So with that in mind, we need to focus

15 on being concise, being succinct, attempting not

16 to repeat ourselves. And I think as the

17 facilitators were discussing over lunch we need

18 to focus on answering the questions at hand

19 because those questions will help the Department

20 in drafting language that we will then be able to

21 look at and evaluate and negotiate on during the

22 next meeting.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

153

1 So with that in mind, if we can keep

2 the discussion pointed on the issues, on the

3 questions at hand that would be much appreciated. 

4 Kind of a supplementary note to that, you know,

5 we are all here in good faith to negotiate.

6 I think there's been some concerns

7 raised to the facilitators about the

8 characterization of some of the comments at the

9 table. I understand everyone here has strong

10 opinions on the issues that we are discussing.

11 I just want everyone to be aware that

12 those concerns have been raised about, you know,

13 characterization of other individuals at the

14 table and the organizations they may represent. 

15 So I think kind of reverting to my first point

16 focusing on the questions at hand, focusing on

17 the issue papers before us will help us really be

18 productive and avoid those concerns arising over

19 the next couple of hours today and tomorrow.

20 So I appreciate everyone's best

21 efforts to stay on track. And I will warn you in

22 advance noting that we have 21 issues left your
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

154

1 facilitator team is going to give you a shorter

2 time span on comments and we will be cutting off,

3 you know, people or at least jumping in and

4 asking you to summarize succinctly at times.

5 That is not a, you know, a judgment of

6 the comment or the individual making the comment. 

7 We're just trying to keep things efficient. 

8 Thank you very much.

9 So if, Annmarie, if you could open it

10 up. I know you mentioned briefly that you had

11 one more question on Issue Paper 1.

12 MS. WEISMAN: Yes. We started just

13 before we broke for lunch regarding some

14 discussion about statute of limitations. And it

15 is a point that I think we thought could kind of

16 go into multiple areas and multiple issue papers.

17 But since we were kind of leaving off

18 on that discussion and people were starting to

19 have some really fruitful comments we thought it

20 might be helpful to go ahead and keep down that

21 path for just a little bit so that you could have

22 your say on that issue now.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

155

1 Again, because we seem to, the

2 conversation seemed to naturally flow there. So

3 if people have comments about statute of

4 limitations whether there should be one,

5 shouldn't, if so how long this would be the time

6 to have that discussion.

7 MS. MILLER: Before we begin that

8 discussion, Annmarie, we have a procedural

9 request from Ashley Reich.

10 Ms. REICH: Yes, just a couple of us

11 were talking. Several of us have the same first

12 names. So it would be really helpful I think for

13 the record, I know the facilitators are doing a

14 really great job about stating, you know, Ashley

15 Harrington versus Ashley Reich, et cetera.

16 But for all of you if you're speaking

17 in reference to a comment that was made by

18 someone that maybe has the same name it would be

19 helpful to recognize their last name as well. We

20 can't enforce that. But I think it would be

21 helpful for the record.

22 MS. MILLER: Thank you.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

156

1 MR. BANTLE: Okay. Opening up the

2 floor to comments on the statute of limitations.

3 MS. MILLER: Ashley Reich.

4 MS. REICH: Okay, sorry. I should

5 just keep talking. Just one comment on that. I

6 know that institutions are only held responsible

7 for document collection for a certain period of

8 time.

9 And so I think we need to keep that in

10 mind when we're talking about a statute of

11 limitations if, you know, schools are asked for

12 documentation and to provide documentation for

13 the student's particular claim. So I know that

14 those would kind of, those would need to probably

15 coincide with one another.

16 MS. MILLER: Aaron.

17 MR. LACEY: The comment was made

18 earlier and it's a very fair one that, you know,

19 there's a distinction to be drawn here depending

20 on whether or not we're talking about a

21 bifurcated process or not.

22 And we haven't really gotten in the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

157

1 process. But if we're talking about the idea

2 that there would be one decision made with regard

3 to discharging the claim and a second process and

4 decision made with regard to whether or not the

5 Department could recover then you're talking

6 about two statute of limitations.

7 If we end up ultimately determining

8 that there would be one process during which a

9 single official would make the decision both with

10 regard to whether to discharge a claim and

11 liability you're talking about one statute of

12 limitations. And that distinction is really

13 material, right.

14 So in a bifurcated proceeding the

15 point was made earlier and I agree from an

16 institutional risk management standpoint I'm less

17 concerned about the statute of limitations that

18 applies to the student if we're only talking

19 about discharging the student's claim.

20 With regard to any recovery action we

21 absolutely believe there should be a statute of

22 limitations. We would suggest that something
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

158

1 tied to the period during which institutions are

2 required to keep documentation which is usually

3 about three to five years would be reasonable.

4 I also think five years is pretty

5 consistent and folks can fact check me on this,

6 but with the types of statute of limitations you

7 see under a lot of Consumer Protection Act and

8 other types of state laws.

9 But if we're talking about a married

10 process where you would have a single decision

11 made I just want to be really clear we would also

12 expect a statute of limitations.

13 MR. BANTLE: Additional comments.

14 PARTICIPANT: There is really no

15 justification for linking the two because the

16 Secretary's unilateral decision to accept a

17 defense offered by a borrower and his or decision

18 to discharge a debt, you know, it may be

19 probative in revealing evidence that maybe would

20 not have come to light.

21 But it doesn't really create a new

22 cause of action against institutions. Whatever
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

159

1 the Secretary's authority is that authority

2 exists with or without a successful defense or an

3 unsuccessful defense.

4 And therefore, I really do think that

5 it's in our collective interest to separate the

6 two and in fact I would urge the non-federal

7 negotiators to collectively agree to recommend to

8 the Department to just drop the issue of

9 institutional liability all together.

10 Whatever the institutional liabilities

11 are they exist separate and apart from the

12 decisions the Secretary makes with regard to

13 discharges.

14 MR. BANTLE: Is there anybody else

15 that has a comment on the statute of limitations

16 question? Seeing no tags up you can respond now.

17 PARTICIPANT: So I disagree strongly. 

18 I think there are multiple reasons to have a

19 single process and not a bifurcated process. 

20 First, I think with due respect to the

21 departmental staffers that staff members at the

22 Department are more subject to political pressure
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

160

1 than you would expect an administrative law judge

2 to be.

3 If there is anything I would think

4 everyone in the room could agree to that we have

5 learned in the last 12 months it is that the

6 White House and its views of the world can change

7 dramatically in a short period of time. And the

8 Department of Education and the staff members are

9 part of that administration.

10 And I think we owe it to institutions

11 and students and everyone involved here to try to

12 create a process that is independent of those

13 type of political machinations as possible. And

14 I think that would involve potentially marrying

15 the process together and putting as much of it as

16 possible in the hands of independent parties.

17 Two, I think that if you have a

18 discharge process that is separate from the

19 process that involves recovery from institutions

20 you create enormous exposure for taxpayers or the

21 government or whoever you might like to say.

22 But if you've got staff members who
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

161

1 are part of a White House at that point in time

2 that for whatever reason feels under whatever

3 standard is in place they want to discharge a lot

4 of loans and then ALJs who are making different

5 decisions with regard to the exact same claim,

6 all of those discharged loans can't be recovered

7 which I think is extremely problematic.

8 The other issue I have, third, is that

9 you put staff members if they're making decisions

10 on the merits and with regard to amounts to

11 discharge and the position of making what I would

12 call precedential decisions but there's no

13 process in place right now to capture precedent

14 when you talk about decisions that are made by

15 staff members.

16 It's also totally unclear if you had

17 a bifurcated process the extent to which

18 decisions made by staff members would hold

19 precedential value vis-a-vis the decisions being

20 made by the ALJs subsequently.

21 So and we can talk about this more

22 later. But I just want to highlight that I have
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

162

1 multiple reasons that I think a bifurcated

2 process is problematic.

3 MR. BANTLE: We'll go, Suzanne.

4 MS. MARTINDALE: I just want to bring

5 up it's sort of a problem when you start

6 attaching statute of limitations to the students

7 because and I heard potentially a five year

8 statute of limitation brought up.

9 And some of the programs if a student

10 is full time are four year programs. A lot of

11 these students are not full time and so therefore

12 they could be at an institution for a length of

13 time that would exceed even the statute of

14 limitations before they could recognize that

15 there was a problem.

16 Some of the students would already be

17 gone. And tying it to record retention is also

18 difficult because I guess you could potentially

19 define a statute of limitations as five years

20 after the required record retention for that

21 individual student.

22 But there's a weird construct there
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

163

1 when you're trying to attach it to the student

2 and to the school. So I would say conversely I

3 think we need two different definitions because

4 of that.

5 PARTICIPANT: Well since I'm the one

6 who brought up the statute of limitations I'll

7 just clarify that I was envisioning a bifurcated

8 process as well focusing on the fact that federal

9 debt does not have a statute of limitations.

10 So borrowers are subjected to

11 collections until they die. That was why I was

12 thinking, that's why I was advocating for not

13 having a statute of limitations there.

14 I would strongly agree that a

15 bifurcated process is, I think, you know,

16 necessary to ensure fairness in this context

17 particularly because we don't want to be in a

18 situation where we're talking about borrower

19 defense and institutional liability in the same

20 situation which effectively creates a zero-sum

21 game between the students and the schools and

22 kind of pits their interests against each other
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

164

1 before the Department.

2 I don't think that any of us, you

3 know, want that. We don't want schools and

4 students to be pitted against each other.

5 PARTICIPANT: And I think if indeed

6 the Department goes this way that some

7 consideration in terms of the statute of

8 limitations for students, I think, yes, some

9 students attend on and on and on and on.

10 But those that go on and on are the

11 ones who get federal student aid. There are

12 lifetime limits in the student aid program. So,

13 yes, there are ten year, 15 year. We actually

14 found a 17 year Pell recipient years ago.

15 But again these days with lifetime

16 limits in both the Pell and loan program. And I

17 admit I'd have to go back and look at what the

18 record retention requirements are, how those are

19 structured.

20 But it seems to me that the interests

21 of the Department are with students who are

22 accessing federal resources.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

165

1 MS. CARUSO: Ashley Reich.

2 MS. REICH: Maybe the Department can

3 clarify too the three year, five year. I know

4 there's an open audit time frame as well. If you

5 have an open audit you get a longer amount of

6 time.

7 And then my question back to what

8 Alyssa had mentioned. If we don't go with some

9 sort of record retention requirement then is

10 there another standard or another time period

11 that you would suggest looking at that schools

12 are already having to do because if, to my point

13 earlier, if we don't, we would have to update the

14 current record retention policy for institutions

15 if it was, if this particular language was

16 somehow changed because we can't go back to an

17 institution, you know, ten years later if the

18 record retention says three years.

19 That isn't, they wouldn't have that

20 documentation. So do you have another suggestion

21 maybe that would be helpful for that?

22 PARTICIPANT: No, I think the point
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

166

1 that I was trying to make is that attaching a

2 student's limit to our record retention limit

3 isn't fair because it's going to be different for

4 each student depending on how long they're in the

5 program, when they separate from the school where

6 they could have experienced the same

7 misrepresentation but their statute of

8 limitations would be different just based on

9 their period of attendance.

10 And that doesn't make sense to me. So

11 again, do I have a suggestion? Not really. 

12 Speaking for students I see fairness in not

13 having a statute echoing the concerns of some of

14 the people who have already spoke today because

15 they can collect for a lifetime.

16 But speaking from a school my concerns

17 are the same as yours because we do have record

18 retention policies. So and that's just

19 reiterating that's why I think they can't be

20 linked.

21 MS. CARUSO: So Ashley Reich she would

22 like to respond and then I want to Kelli and then
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

167

1 Linda.

2 MS. REICH: So you would be in favor

3 of a, following a similar record retention for

4 institutional liability not for students,

5 correct? Okay, I understand and I agree.

6 MS. HUDSON PERRY: Just a point of

7 clarification. When we talk about or those of

8 you around the table that have talked about no

9 statute of limitations for students, are you

10 saying that assuming that the student has already

11 repaid their loan in full that statute of

12 limitations would not exist past that date so

13 that if something came up with an institution

14 where, you know, the student then decided that

15 they were misrepresented, you know, five years

16 after their loans were repaid that they would be

17 able to bring a claim?

18 MS. CARUSO: Who are you asking,

19 Kelli? Just the group, okay. Alyssa.

20 MS. DOBSON: I would, from my

21 perspective, yes, I think that they should still

22 be able to bring a claim in that case.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

168

1 MS. RAWLES: I just want to make a

2 suggestion which is we may want to tie this

3 conversation into the financial responsibility

4 conversation because depending on whether or not

5 we bifurcate and we don't favor that, whether or

6 not we have a statute of limitations, which we do

7 favor especially vis-a-vis institutions.

8 If you ended up with too long of a

9 statute of limitations or no statute of

10 limitations for institutions you're also exposing

11 them to enormous liability. And that's going to

12 have go into our discussion of financial

13 responsibility and what kinds of letters of

14 credit we're going to expect institutions to

15 have.

16 So I think we have to be practical

17 about the possible amount of exposure we're

18 giving to institutions.

19 PARTICIPANT: I also think it's useful

20 just to be practical and realize that, and I've

21 already stated the reasons I think a bifurcated

22 process is not the best. But the other thing is
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

169

1 I think it's really important to appreciate that,

2 look, if the Department is discharging loans

3 there will be enormous pressure to recover those

4 amounts.

5 I don't think it's as a practical

6 matter fair to divorce the two completely and

7 assume that even if you're discharging loans

8 based on a lower standard or the, you know, with

9 no statute of limitations staff are making those

10 decisions you're going to create this amount that

11 is owed.

12 The Department has a directive

13 arguably to try to recover those amounts, right. 

14 But even if it doesn't have a directive the fact

15 is you still have all that debt out there and I

16 think there is an expectation or has to be that

17 there could be an attempt to recover those

18 amounts.

19 So you're creating, talking about risk

20 allocation. I mean my point is I don't think

21 it's fair to say if we've got a bifurcated

22 process we don't create any risk for
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

170

1 institutions. That's just not realistic.

2 If the Department is discharging

3 thousands and thousands and millions of dollars

4 of loans that is absolutely creating risk for

5 institutions even if you have a bifurcated

6 process. And it's going to create a lot of

7 pressure to recover on those funds.

8 MS. CARUSO: Okay. Unless I hear

9 otherwise. Michael, did you have, your mic is

10 on, okay. Unless I hear otherwise I'm going to

11 assume that we have had a discussion of the

12 statute of limitations unless there's something

13 else that we need to visit.

14 I would ask that we begin to discuss

15 Issue Number 2. Going, going, okay, yes.

16 MR. BUSADA: Just a clarification. So

17 are we going to wait and have, further discuss

18 statute of limitations at a point in time that

19 we're talking about bifurcation or is that going

20 to be it for this round?

21 MS. CARUSO: Do you have something

22 specific to the statute of limitations question?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

171

1 MR. BUSADA: I just want to, yes, I

2 mean on the statute of limitations I do think it

3 matters which process you go down whether it's

4 bifurcated or unified. I do think it makes a big

5 difference.

6 But let's also keep in mind that

7 there's a lot of different things that play on

8 the statute of limitations. I mean when you go

9 back to, and not to sound like a history

10 academic, but I mean if you really go back and

11 look at the whole purpose of statute of

12 limitations going back to the ancient Roman

13 civilizations and on it was for protection of all

14 the parties.

15 And one of the biggest protections is

16 once a case gets too far out it is very, very,

17 very difficult to have evidence that still exists

18 to be able to prosecute and come up with a fair

19 and just outcome. And so that's why people are

20 encouraged to present these within the matter of

21 time before the evidence is spoiled.

22 And looking today, yes, it is a little
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

172

1 bit easier today with electronic documents. But

2 let's keep in mind that if we extend electronic

3 documents one, you're still having, it's still,

4 it's going to increase costs significantly to

5 hold those documents longer.

6 But more importantly with the

7 technology out there now and all the hacking

8 threats there is a student privacy and a personal

9 privacy concern out there because the longer you

10 hold those documents in your system, your online

11 system the longer that those personal, private

12 documents would be potentially open to hackers

13 and nefarious users.

14 So I think that we need to come up

15 with a policy that's fair. But I mean the

16 statute of limitations is just a fundamental

17 bedrock in determining justice, I mean going back

18 centuries. So I don't think we should second

19 guess that.

20 I just think we should come up with a

21 fair standard.

22 MS. CARUSO: Okay. Thank you, Mike. 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

173

1 Joseline and then we're going to go back to the

2 Department.

3 MS. GARCIA: I just have a question

4 and it might be like a data request as well. Do

5 you all know or could you provide us how much the

6 Department has recovered from schools based on

7 closed school discharge?

8 MS. WEISMAN: I don't have that

9 information readily available. We can put in a

10 request for data and see what we get back.

11 MS. GARCIA: Okay, thank you.

12 MS. WEISMAN: Do you have a period of

13 time? It's helpful if we can define the

14 parameters of what we're asking for as much as

15 possible.

16 So if you said I want it from this

17 period to this period, you know, going back how

18 many years would be helpful to know what would be

19 of interest to you.

20 MS. GARCIA: As much as you can.

21 MS. CARUSO: Okay. So I would ask the

22 Department are there any other questions that you
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

174

1 have around statute of limitations or any other

2 elements of Issue 1, okay.

3 So moving on to Issue Paper Number 2

4 if we could just revisit either just a brief

5 issue summary or specifically anything you're

6 looking for outside of the questions as they're

7 stated.

8 MS. WEISMAN: So Issue Paper 2 is

9 focusing on process. We were, in the previous

10 regulations what is currently in effect, again

11 going back to 1994 we did not go into great

12 detail about process related to borrower defense.

13 As we've said previously, the number

14 of claims that we had over a period of many years

15 was almost insignificant. It was a very, very

16 small number.

17 And so as we look forward to what

18 could come down later we want to be prepared. We

19 want to look at how might we identify a process

20 of submitting claims to the Department and how

21 would we evaluate those.

22 We want to make this easy to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

175

1 understand for all parties involved. We want to

2 make sure that we have a process that would

3 include submission of sufficient evidence to make

4 a claim.

5 We want to make sure that we have

6 clear expectations for borrowers and for

7 institutions. Discussions about next steps, time

8 frames and anything around process is helpful

9 here.

10 And again, we want a process that's

11 fair and equitable to all of the parties

12 involved. So we would start out by saying what

13 process should a borrower follow to submit and

14 establish a basis for a borrower defense claim?

15 And I think if we could again try to

16 take them bullet point by bullet point. There

17 may be a couple that are tied together. But at

18 least for this first one if we could start with

19 that bullet point that would be helpful.

20 MR. BANTLE: And just as a facilitator

21 note, we know this is a somewhat amorphous

22 question. So just please be aware of the, you
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

176

1 know, the time we do have left.

2 But we do, we would like any and all

3 suggestions.

4 MS. CARUSO: Kelli, please.

5 MS. HUDSON PERRY: Annmarie, I know

6 you want to start with the first bullet. But I'm

7 going to actually skip down to the fourth or

8 fifth bullet just because I think it makes sense.

9 I mean one of the questions you're

10 saying is should the process differ depending

11 upon whether the school is open or closed. And,

12 you know, sitting here listening over the last

13 day or so I think there is two real main reasons

14 why somebody might petition for discharge.

15 One being misrepresentation the other

16 being a school closure, right. So and I think we

17 heard from the Undersecretary this morning that

18 the majority of the claims that you have now do

19 relate to school closure.

20 And you just mentioned that there

21 haven't been a lot of claims probably from a

22 misrepresentation perspective that the Department
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

177

1 has had to deal with. We also talked in Issue

2 Paper Number 1 about the federal statute versus

3 the state statute.

4 So, you know, I didn't really speak to

5 that at this point. But I'm just going to

6 mention this now where there may be a

7 differentiation between misrepresentation and

8 school closure from that perspective as well

9 because of the schools, sorry, because of the

10 states having different rules relating to

11 misrepresentation and things like that.

12 Where I might propose that

13 misrepresentation stay with a state statute where

14 the school closure would follow a federal rule

15 potentially in an effort to expedite the process.

16 So if it's a situation where the

17 Department is trying to expedite the process of

18 discharging these claims and a good chunk of them

19 is being brought based on a school closure, would

20 it make sense to look at that school closure as

21 one claim and the Department take action simply

22 based on the fact that school is closed?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

178

1 MS. CARUSO: So responses to Kelli's

2 point and also any process suggestions in general

3 based on Bullet Point Number 1 or the process for

4 submitting and evaluating a claim. Yes, Alyssa.

5 MS. DOBSON: Since we're talking about

6 having a different process whether the school is

7 open or closed and I don't see it mentioned

8 anywhere in here.

9 But I do think it's important for the

10 school to have an opportunity for involvement,

11 rebuttal to provide their case, if you will, to

12 defend against any type of claim especially if

13 there's going to be recovery.

14 MS. CARUSO: Walter, Dan and then

15 Michael.

16 MR. OCHINKO: Yes, I just wanted to

17 quickly respond to Kelli's comment and that

18 especially with respect to Corinthian is a pretty

19 much 100 percent overlap between closure and

20 misrepresentation.

21 PARTICIPANT: We have a mike open and

22 we're getting some feedback and can't hear
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

179

1 Walter.

2 MR. OCHINKO: That's me. Quickly to

3 repeat myself I just wanted to say that with

4 respect to Corinthian I think there's a pretty

5 much 100 percent overlap between closure and

6 misrepresentation.

7 MS. CARUSO: Okay. Dan, Michael,

8 Linda.

9 MR. MADZELAN: I just have sort of a

10 framing question. The, who is eligible for a

11 borrower defense claim in the context of where

12 they are in their sort of loan history.

13 The current loan regulations speak to

14 any proceeding to collect on a direct loan. 

15 Collect historically is a term that is used in,

16 for defaulted loans.

17 If you look at the due diligence rules

18 around, you know, loan servicing you don't see

19 the word collect. So, you know, the way the

20 existing rule is written seems to imply that it's

21 a defense to collection activities by either a

22 guarantee agency well or by the government I
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

180

1 should say.

2 So I don't know if, you know, that

3 where the Department was or has been or is on

4 this. But again, because the existing rule is

5 written in such a way that at least to me

6 strongly suggests applies to borrowers who are in

7 default is that, will that, is that the case or

8 does the Agency have some discretion here? I

9 just throw that out as a question.

10 MS. CARUSO: Michael.

11 MR. BOTTRILL: Well, yes, also as a

12 framing matter I think the process should be

13 easily understood, facilitate the submission of

14 sufficient evidence, establish clear expectations

15 for the borrower ensured claims.

16 So I think that you've framed it up

17 exactly the right way in terms of the goals that

18 I think are the appropriate ones to be looking

19 at. And so, you know, fair and equitability I

20 think are important equations in that.

21 And the metrics that are used to try

22 to determine that. So, Kelli Hudson Perry, to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

181

1 your question or your statement are you

2 suggesting that in a closed school scenario

3 students go into this lane which may be an

4 express lane and in an open school scenario there

5 is another lane whereby there's more gathering

6 and submission of evidence and more adjudication.

7 So two, that's the kind of the

8 separating factor that by virtue of the fact that

9 the school is closed the claim is handled this

10 way as opposed to another.

11 MS. HUDSON PERRY: To confirm with my

12 head nodding, yes, that's what I'm suggesting.

13 MR. BOTTRILL: Thank you.

14 MS. CARUSO: So Linda, Ashley Reich

15 and then Abby.

16 MS. RAWLES: We just need a bigger

17 table.

18 PARTICIPANT: Can I just, one more

19 thing quick. Unless, Walter, you have some

20 information that I don't have I don't know and

21 the Undersecretary didn't say today and I just, I

22 don't know if this is accurate or not, the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

182

1 reasons by which any defense claims are being

2 granted by the Department.

3 I don't, that's why I asked for the

4 information whether or not they're being done for

5 closed school or for misrepresentation. So maybe

6 you have that information and I don't. But I

7 mean that's why I've asked for it.

8 MS. RAWLES: I think I'm responding to

9 the first one but let me know if I go too far off

10 base. I think they are so connected. I think we

11 should consider whether or not the student has,

12 to use a legal term, exhausted their

13 administrative remedies.

14 I think they should have at least

15 tried to resolve the issue with the school unless

16 for some reason that was impossible. Then if

17 that doesn't work I think then the Department

18 staff would try to resolve the issue.

19 If there's a sufficient claim made to

20 the Department of course we would have to talk

21 about what sufficient claim is. And if that sort

22 of informal resolution does not create agreement
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

183

1 between the school and the student assuming that

2 the school is still open, then I think it should

3 go out to ALJ or administrative law judge for

4 those of you who may not know what that is where

5 there is due process for all parties.

6 And then under certain circumstances

7 there would be an appeal to the Secretary if

8 parties were not pleased with the ALJ process. 

9 So I think we started this conversation saying we

10 wanted something that was clear and fair to all

11 parties.

12 So I think that rough outline is a

13 process that would be clear and fair.

14 MS. CARUSO: Thank you. Ashley Reich.

15 MS. REICH: Just for some clarity, the

16 90 some thousand outstanding borrower defense

17 claims that are, that you all are working on now,

18 how, are they filling out an application for

19 borrower defense?

20 And if so which application are they

21 using because the one on the web does not allow

22 them to, like there is no option for closed
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

184

1 school discharge under the circumstances where

2 that's appropriate. So how are they currently

3 doing this?

4 MS. WEISMAN: Closed school discharge

5 is a separate process. So again, I want to make

6 sure we're focusing this discussion on the

7 borrower defense claims.

8 There is a separate application

9 available for closed school discharge if a

10 borrower feels that they meet those conditions. 

11 And that includes things like enrolling within

12 120 days of the closure date of the institution.

13 So closed school discharge is kind of

14 a faster way because that process is already in

15 place. It's been in place for years. That

16 application has existed.

17 They can go ahead and do those. But

18 for those who didn't meet that condition there

19 are, there is a borrower defense application

20 online.

21 There was a previous iteration of that

22 application. There was one that was streamlined
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

185

1 for Corinthian borrowers in some cases.

2 So I'll say that the claims that are

3 out there, and I'm certainly not an expert on the

4 borrower defense claim process, but I do know

5 that there are applications of multiple types

6 then of both at least of those that are kind of

7 in the pipeline and waiting to be adjudicated.

8 MS. REICH: Okay, thank you.

9 MS. CARUSO: Abby, Aaron. Robert, did

10 you put yours down because your question was

11 answered? Okay, Abby, Aaron and then Will.

12 MS. SHAFROTH: Thank you. So there

13 was, Dan raised a question about whether the

14 process for seeking relief should only be

15 available to borrowers who have already defaulted

16 on their loans and are in the collection process.

17 My understanding is that the

18 Department is not, does not interpret the 1995

19 regulation that way and is allowing affirmative

20 applications from students who are not in default

21 to be considered for borrower relief currently

22 under the current process.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

186

1 And I hope, Annmarie or Caroline will

2 correct me if I'm wrong about that. And I would

3 offer that's the right approach, that it doesn't

4 make sense to say that only student borrowers who

5 have defaulted on their loans should be eligible

6 for relief.

7 I don't think we would want to say if

8 you want to get relief you better default first

9 and then we'll consider whether you should get

10 relief. That seems like a bad outcome for

11 everyone.

12 So I hope we would not go that way. 

13 Second, in terms of, you know, going back to

14 Question 1, what process should a borrower

15 follow? I want to focus this on that question,

16 what should the borrower do.

17 And I think that the, that we should

18 in thinking through that keep in mind that the

19 vast majority of borrowers who feel that they

20 have been scammed, misled, defrauded, otherwise

21 taken advantage of by a school are not going to

22 be folks who are able to access assistance of
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

187

1 counsel.

2 I provide legal aid services to

3 borrowers in this situation. But I am only able

4 to help a small number and there are thousands

5 and thousands who aren't able to access counsel.

6 So we need to make sure that any

7 process is available and accessible to borrowers

8 who aren't represented by counsel and we need to

9 make sure it can be easily navigated, a simple

10 public form. You know, the Department currently

11 has a public application form.

12 That seems like an appropriate way to

13 do this with plain language not requiring the

14 borrower to get into legal ease. The borrower

15 also, you know, I hesitate to go too much again

16 into this point of one process for borrowers and

17 one process for schools versus not.

18 But that's to me another reason that

19 it's very important to have two separate

20 processes. If we have a process where the

21 student is, student borrower is pitted against

22 the school, yes, there may be some small schools
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

188

1 that also don't have legal counsel.

2 But there are a lot of schools that

3 are giant public corporations and have extensive

4 legal teams. And pitting that extensive legal

5 team against a pro se borrower who may be, you

6 know, doesn't have any postsecondary degree and

7 certainly has no legal training is just, I think

8 a truly unfair process that's unlikely to come to

9 an acceptable outcome.

10 The other point I wanted to make is

11 this question was framed as what process should a

12 borrower follow to submit. I would argue that in

13 addition to there being a process for individual

14 borrowers to affirmatively seek relief there

15 should also be a process whereby the Department

16 of Education can initiate relief to groups of

17 borrowers if the Department has conducted an

18 investigation or received information from a

19 state attorney general or other law enforcement

20 agency where they have found evidence of

21 systematic misconduct that would give rise to

22 borrower defenses that the Department should be
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

189

1 able to initiate a process to provide relief to

2 groups of students rather than requiring each

3 student to raise their hand and come forward one

4 by one and to adjudicate each of those

5 independently.

6 MS. CARUSO: Okay. So we've got a

7 bunch of folks up to speak. Aaron, Will,

8 Michael, Wanda and Jay. I'm also hearing, you

9 know, common themes in the interests that you are

10 putting forth.

11 You want a process that's clear, fair

12 and accessible. That's being understood here. 

13 So did you put yours down, Aaron? Got you, all

14 right. Aaron, go for it.

15 MR. LACEY: Yes. So and I'll be as

16 quick and concise as possible. I agree with Abby

17 on your first two points. I don't, I agree that

18 I don't think students should have to go into

19 default to be able to start the process and

20 certainly agree with everyone that it should be

21 simple and accessible to folks.

22 I don't think it should be so complex
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

190

1 that you have to have counsel. On the

2 bifurcation point, you know, the idea that we

3 should keep the process simple so we don't pit

4 schools against students, unless you're going to

5 exclude schools entirely from the initial

6 determination they're already pitted against each

7 other.

8 The only difference is you're putting

9 them in front of an ALJ instead of a staff member

10 at the Department. But if you're going to allow

11 schools, if you're going to tell them that a

12 claim has been filed and allow them to

13 participate you're already there.

14 You've already got the school and the

15 student both providing information in front of a

16 third party at the Department. So my point is

17 that third party should be as independent from

18 the political process of the day as possible and

19 right now that's the administrative law judges in

20 the Office of Hearing and Appeals.

21 With regard to closed schools I just

22 think we need to be careful. And some folks may
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

191

1 know this, I know they do, some others may not. 

2 But when you talk about a school at the

3 Department you're talking about a regulatory

4 concept, an OPE ID, right.

5 So whether you're for-profit or non6 profit it's entirely feasible that you could have

7 an organization that would close a school but the

8 organization still exists. I think

9 philosophically the reason previously that the

10 thinking was if you have a closed school they

11 don't need as much in the way of due process

12 protections is because there's nobody left there

13 who would need the due process.

14 But I think that's a fiction. I think

15 you will regularly have circumstances where you

16 might have a school that is closed or a location

17 that is closed, an additional location but

18 there's still a school or organization proper out

19 there that cares about its rights.

20 So I do not think that, at least in so

21 far as we're determining the liability of an

22 institution, it makes sense to limit the rights
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

192

1 of a "closed school" because again I think

2 there's an organization there that could really

3 care about responding.

4 With regard to process, so I would

5 take a slightly different approach but I do agree

6 with Linda. I think it is in absolutely the best

7 public policy interest to have some mechanism

8 when a claim has been filed to at least allow a

9 school and a student to see if they can come to

10 an informal resolution.

11 The Department encourages that right

12 now and most systems, court systems et cetera

13 they'll encourage some sort of settlement. I'm

14 not suggesting that a student would have to agree

15 to that.

16 But I think it would be helpful. I

17 mean what I had proposed as opposed to the

18 exhaustion of internal remedies was the idea

19 that, you know, you get a claim and you notify

20 the parties and you tell them you've got 60 days

21 to try to meet and settle and let us know if you

22 can come up with something.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

193

1 At least then they have a chance. 

2 Again, if the student doesn't want to talk to

3 them understood. But at least give the

4 institution a chance to reach out to the student

5 if student is interested and to see if they can

6 resolve it and then you save on the

7 administrative time and costs and all that kind

8 of jazz.

9 I've already advocated for a single

10 process. I do not like a bifurcated process and

11 I've explained why.

12 What I would suggest is that when a

13 staffer receives a claim after they notify the

14 parties and give them the 60 days or what have

15 you to try to resolve the issue their job would

16 be to certify whether or not the claim on its

17 face satisfies whatever standard we come up with

18 assuming that the allegations made by the student

19 are true, right.

20 So there's not an actual finding on

21 the merits. I think that way you ostensibly can

22 weed out claims that don't even on their face
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

194

1 satisfy the components or elements of the

2 standard that we design or come up with.

3 But then once that is certified the

4 staffer can assist the student potentially in

5 gathering evidence, notifying people of their

6 rights and responsibilities and then it goes off

7 to an administrative law judge and it's managed

8 pursuant to a process that ensures due process et

9 cetera for all.

10 MS. CARUSO: Okay. So I've got you,

11 Linda. I've got you on my list. I'm hearing

12 some things for the second time, hearing some

13 repetitive interests and suggestions.

14 So what I want to do is limit this

15 round to the folks who have their cards raised at

16 this time. Let's get the comments from you all

17 new and then have a check in. So next one is

18 Will.

19 MR. HUBBARD: Thanks, Moira. I want

20 to touch on what Aaron said and the comment was

21 made earlier as it pertains to Question 1 the

22 process that a borrower should follow and
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

195

1 establish.

2 Note that it specifically identifies

3 the borrower as the category in that specific

4 instance, not the school. So in this case we're

5 talking about the student.

6 I don't necessarily disagree that

7 there could be potentially be an opportunity to

8 resolve that if the student wanted to. That

9 could be an option for them.

10 But it's not a, something that the,

11 we're not doing that on behalf of the school and

12 we'll probably get into that a little bit more in

13 Point 4.

14 But something that I would like to

15 address as it pertains to the military and

16 veterans community. Many people I think

17 mistakenly believe that if you've served in the

18 military that you already have the GI Bill,

19 you're covered, you don't have loan discharge.

20 But that's actually a tremendous myth. 

21 We know that certainly reservists who don't have

22 access to the GI Bill, military families, those
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

196

1 who perhaps expended on prior education and those

2 who are coming with prior debt are affected.

3 So it's an important audience to

4 consider in this. And as we seek to have a clear

5 and fair and accessible process I think to say to

6 those military connected families and students

7 that they would be expected to go to the school

8 who potentially shattered their life is insulting

9 and something that would, I think for some

10 students be so uncomfortable they would rather

11 just live with the debt.

12 So as an option for the student

13 perhaps something to consider. But let's not

14 start pushing into the idea of doing that on

15 behalf of schools.

16 MS. CARUSO: Wanda.

17 MS. HALL: Not to restate what Dan and

18 Abby said, I mean they don't, they shouldn't go

19 to the point where they're defaulted, absolutely

20 not. By the time they get to that point there is

21 already a lot of damage done from the perspective

22 that their credit has been affected because in
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

197

1 most instances we're reporting that they are, you

2 know, they have adverse credit when they're 90

3 days delinquent.

4 So, but that does lead you to your

5 Bullet Number 2 which has to do with the

6 automatic administrative forbearance. That

7 happens today. I mean we do apply an

8 administrative forbearance when we're notified

9 the borrower has submitted the application.

10 And so, yes, there should be

11 administrative forbearance would be what I would

12 say.

13 MS. CARUSO: Jaye.

14 MS. O'CONNELL: So to follow Wanda

15 that was largely the comment I was going to make. 

16 And I was, had a question as to whether

17 682.211(I)(7) from the 2016 regs which is the

18 administrative forbearance, if that was not

19 delayed because as guarantee agencies and lenders

20 we are receiving lists to apply administrative

21 forbearances or if that's just part of the

22 Department's process.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

198

1 Just curious as to whether we are

2 regulating this piece truly or was that one of

3 the provisions that was approved for

4 implementation.

5 MS. WEISMAN: So we would like to

6 respond to that and just clarify that it was an

7 item that was flagged for early implementation. 

8 So people were able to implement things for early

9 implementation if they chose to do it.

10 But if it's something that we're

11 interested in keeping as part of any new set of

12 regulations that we want to enact we would need

13 to have that discussion here and include that as

14 part of our package going forward.

15 The other thing is it seems as if

16 we're starting to go down that path organically

17 about the idea of automatic administrative

18 forbearance. So I'm not trying to cut off

19 conversation if there are still things to be said

20 on the other issues.

21 But I also don't want to pull people

22 artificially into a structure. If we're going to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

199

1 start on automatic administrative forbearance the

2 only thing I would say is to remember we also

3 need to hear about the idea of stopping

4 collection activity as part of that as well.

5 And if we are doing either or both of

6 those we have to also address the ideas of an opt

7 in versus an opt out. Would you want a borrower

8 to have to request an administrative forbearance

9 or a cessation of collection activity or would

10 you want it to be assumed that it's there and

11 they, you know, that they have to say, no, if

12 they don't want it?

13 So if the discussion around that could

14 include all of those items. And again, it's kind

15 of a three part then question. But we're ready

16 to hear feedback on that as well.

17 MS. CARUSO: Okay. So we have a

18 request from the Department to move to the

19 discussion of automatic administrative

20 forbearance including the question of stopping

21 the collection activity as well as opt in versus

22 opt out.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

200

1 So if you could address those that

2 would be great. Certainly not cutting off

3 discussion on the other items, but noting that,

4 the desire to move in that direction. Linda, are

5 you, go.

6 MS. RAWLES: Mostly I want to mention

7 forbearance. But first, there was a mention of

8 group claims. And so I did want to point out

9 that we talk about we want fairness and due

10 process.

11 And group claims are sort of the

12 antithesis of due process because you eliminate

13 the nexus between the alleged fraud and the

14 damages, the whole discussion we had this morning

15 about mitigating damages. All those go out the

16 window really if we're talking about a group as

17 opposed to individuals.

18 But on the issue of forbearance I just

19 have one thing to keep in mind. I'm very open

20 minded on this issue.

21 But we talk a lot about incentives and

22 we have to think about what kind of an incentive
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

201

1 we are sending out for folks to file claims with

2 or without merit if we make loan forbearance too

3 automatic or easy.

4 MS. CARUSO: Chris, you're up.

5 MR. DELUCA: So I just wanted to

6 comment on the process and whether we have a

7 bifurcated process or not. And one of the

8 comments was made and the idea that creating a

9 process that's simple and accessible for

10 students, not intimidating for students and not a

11 situation where you're going to have a single

12 student having to face off against a team of

13 lawyers.

14 And I understand that. I mean we want

15 to create a system that's accessible for students

16 in order to file a claim. But it got me thinking

17 about some of the processes that we already have

18 in the educational environment.

19 We've got issues where students are,

20 you know, have process to file complaints with

21 state regulators, a process to file complaints

22 with accrediting agencies and processing, filing
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

202

1 complaints with the Department on other issues. 

2 And so you got me thinking about, you

3 know, working towards a system similar to that

4 where, because I've been involved in many of

5 those on behalf of my clients. And I would be

6 the team of lawyers that they would be facing

7 against if they were going against one of my

8 clients.

9 But the idea being that those

10 processes and I know that the accrediting

11 agencies in the states and the Office for Civil

12 Rights, for example, are working on encouraging

13 students to have a process where they can file a

14 claim and file a complaint against a school.

15 So thinking about that in terms of in

16 here again, but the way that works is that a

17 complaint gets filed and then you've got some,

18 whatever body it is that does an investigation. 

19 But they gather information from the school as

20 well to come up to determine whether or not there

21 was a violation of whether it was state regs,

22 accrediting standards or Department standards.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

203

1 And so it seems like, you know, we can

2 still have a simple process or a single process

3 that's, you know, but again with an opportunity

4 to encourage students who have valid complaints

5 to be able to submit those on borrower defense

6 yet still engage the school without it being a

7 process of where it's something like we would see

8 on some sort of a law procedural on Thursday

9 nights where you've got people in a room fighting

10 against each other and the school and the student

11 having to hire a team of lawyers to do that.

12 I don't think we have to have that as

13 part of the process.

14 MS. CARUSO: Mike, I've got you next. 

15 But, Wanda, I didn't see your tent go down. Are

16 you still, okay, thank you.

17 MR. BOTTRILL: So with regard to the

18 issue of the automatic administrative forbearance

19 and the opt in, opt out. Are there, what would

20 be the stakes I guess for the student in that

21 particular regard?

22 That is to say if I opt in am I
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

204

1 meaning that I would be granted the

2 administrative forbearance and everything would

3 be on hold. Are the stakes that if I choose to

4 do that all the interest continues to accrue and

5 I'll have to pay that at the end or if I just

6 decide to opt out I'm just going to keep going

7 down the path as I was before?

8 Is that what you're envisioning in

9 terms of what the stakes would be to the student

10 in making the decision?

11 MS. WEISMAN: Yes. The concern is

12 that if it's an opt out where they have to

13 specifically say I want to be excluded do they

14 understand the full ramifications of the interest

15 that's accruing on their account?

16 MR. BOTTRILL: Okay. And I think

17 that's an important distinction on how students

18 in the decision making paradigm that they would

19 go through for that particular case.

20 But in a general sense, you know,

21 supportive of the administrative forbearance. I

22 think that there are a number of administrative
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

205

1 processes that support the idea of putting either

2 some kind of quasi injunctive or at least stasis 

3 kind of process in place while something is

4 pending and being determined.

5 And I just wanted to make a quick

6 comment about Aaron's comments about closed

7 schools. I think there's a distinction between a

8 school that responsibly teaches out and closes a

9 campus and a campus that precipitously closes.

10 And if another school is affiliated

11 and is still around after having precipitously

12 closed a campus thereby shutting out students

13 there's liability that attaches to that action. 

14 And so I think it's just important to make the

15 distinction between how the school closed and

16 what harm was actually done to students.

17 MS. CARUSO: Alyssa and then Abby.

18 MS. DOBSON: Just some comments about

19 administrative forbearance and, yes, I think they

20 should be granted an automatic one. But we've

21 already kind of brought up the impact of interest

22 and it was kind of a welcome surprise this
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

206

1 morning from the comments that we heard that

2 interest on those loans that have kind of been

3 held up in the process for a very long time I

4 believe he said one year that interest that would

5 accrue after that time would be forgiven for any

6 student whose borrower claim was denied or sorry,

7 defense repayment was denied.

8 And I think that's an important piece

9 to it. I think that maybe we would want to put

10 that formally into any regulation that we might

11 have.

12 You know, his comments were spot on

13 that not all of the claims are going to be

14 approved. But I don't think that there should be

15 a danger of a ton of interest for these students

16 just because it takes a very long time to process

17 the claims.

18 And further I think the longer it

19 takes to process a claim probably the more

20 complex it is which means that it's not just a

21 frivolous type of case brought by the student but

22 rather that there are some nuances that need to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

207

1 be parsed through. And along with that I wonder

2 if one year is actually even too long before

3 interest forgiveness is granted to those types of

4 students.

5 MS. CARUSO: Abby.

6 MS. SHAFROTH: Thanks. I'm going to

7 try to tick through a few different points here. 

8 There was some discussion about

9 whether students should be required to exhaust or

10 an internal grievance procedure with the school

11 before pursuing a claim with the Department of

12 Education or even if not required to exhaust it

13 told that they are encouraged to meet with the

14 school and have the school notified and to not

15 allow the Department to begin its process until

16 after there's been an opportunity for the school

17 to try to work things out with the student.

18 I think that sounds better in theory

19 than it would be in practice particularly when

20 we're thinking about predatory institutions. If

21 it's a good school and there's an honest mistake

22 or misunderstanding then that might work out
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

208

1 fine.

2 But when we're talking about predatory

3 schools if this is a school that has already

4 scammed a student and a student wants to go to

5 the government and say I've been scammed saying

6 go talk to the institution that scammed you

7 doesn't seem like a good idea.

8 It seems like it's setting that

9 student up to be scammed again, to be told, you

10 know, you don't have rights or like, you know,

11 it's setting them up for being harmed a second

12 time. So I would strongly caution against any

13 sort of requirement to exhaust or pressure to use

14 an internal grievance system before going to the

15 government.

16 In addition, I think that would have

17 a negative impact for students, for future

18 students and for the public and taxpayers in

19 terms of it would tend to quiet and chill

20 information about predatory and illegal conduct. 

21 We want, if there is illegal conduct we want

22 students and borrowers to tell the government.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

209

1 We want the Department of Education to

2 know about this and to investigate it rather than

3 to encourage an opportunity that could lead to

4 cover up or quieting of what's going on. We want

5 everyone to know about this before it gets worse

6 and hurts more students.

7 Second, in terms of the process of a

8 borrower seeking relief on their own and who

9 should be making that determination, I appreciate

10 the point that Aaron raised about wanting to make

11 sure it's someone with some independence.

12 I'm not sure that an ALJ is the

13 appropriate person to be doing that though in

14 part just I think in an individual process with

15 the borrower not having legal counsel and not

16 having often access to any evidence that the

17 school may hold, that there's an important role

18 for the Department to play in helping to

19 investigate and gather the relevant evidence to

20 determine that claim.

21 So I think someone from the Department

22 would need to be involved and they would need to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

210

1 be sharing information with the compliance unit

2 and that sort of thing. Third, Linda raised a

3 point that she doesn't think there should be a

4 group process because she doesn't think that

5 could be consistent with there being due process.

6 I would disagree strongly with that. 

7 There's, a group process could look something

8 like a suit by a state attorney general seeking

9 relief on behalf of a group of students. That

10 exists in the 50 states already and there are due

11 process protections in place to protect all

12 parties in those suits.

13 This isn't something new here. There

14 are also class actions and there is an extensive

15 body of juris prudence around how to provide due

16 process to parties in those actions. Those sorts

17 of principles can be brought to play here as

18 well.

19 So there's no, I don't think that

20 there is, that this is any way antithetical to

21 allowing due process for different parties. 

22 Finally, there's the specific request for
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

211

1 comments on administrative forbearance and

2 stopped collections.

3 On behalf of the legal aid community

4 I would say that we strongly support providing

5 administrative forbearances and stopped

6 collections both to borrowers who, while their

7 borrower defense claims are being processed.

8 And the stopped collections portion is

9 especially important. If someone is in default

10 we don't want them to have their, for example,

11 earned income tax credit that their family relies

12 on seized from them while they're waiting a

13 decision on whether they should owe their loan

14 debt at all.

15 And I support it being an opt out. So

16 the presumption would be that someone gets

17 forbearance for stopped collections unless they

18 check a box on the form saying that they, that,

19 no, they do not want forbearance or stopped

20 collections they would rather keep making

21 payments on their loans.

22 And to the extent that the Department
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

212

1 is willing to forgive interest while in

2 forbearance all the better.

3 MS. CARUSO: Okay. Dawn, Ashley

4 Harrison and Wanda.

5 MS. ROBINSON: So most of my questions

6 or comments have been made. But I did have one

7 question for the Department in regards to the

8 discharged loans.

9 So if a loan is discharged and a

10 student is in default status, does that, is that

11 status removed thereby decreasing the default

12 rate of the institution that they defaulted

13 against while they were, once they got the loan

14 to attend?

15 MS. WEISMAN: The status is removed.

16 MS. ROBINSON: Okay.

17 MS. CARUSO: Ashley Harrison.

18 MS. HARRINGTON: It's Harrington. No

19 problem. I wanted to do a little bit of response

20 to Linda's comments about the group process.

21 We also would agree with a group

22 process being necessary and we would think that
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

213

1 it would be better for both schools and students

2 if there was a common set of facts that the

3 school had to defend against and the students

4 were brought together.

5 In terms of fairness and efficiency

6 there's a group of students who all had the same

7 issue with the same school, the same problem it

8 should make it easier for the school using less

9 resources to address those claims all at once. 

10 So I think it makes sense for both parties in

11 that case to have a process for group discharge.

12 MS. CARUSO: Wanda.

13 MS. HALL: Talking about the

14 administrative forbearance I mean there's two

15 ways to go. One of them is that it's automatic

16 or the borrower requests it.

17 I think that, you know, from our

18 experience in talking to the borrowers and

19 believe you, I mean they're talking and they're

20 complaining to us because we're trying to get

21 money from them and they have a situation. So we

22 would find that the majority of the borrowers,
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

214

1 they want the forbearance.

2 Today it's automatic and we let them

3 know and we notify them that if they don't want

4 it then, you know, then we can remove it. So I

5 think a high percentage of them would want it.

6 What we do need to be careful of

7 though is that, you know, we have the question is

8 it a capitalizing forbearance or a non9 capitalizing forbearance. Today it's non10 capitalizing.

11 It does increase their balance. So,

12 you know, at least for that first year depending

13 on, you know, what the final resolution would be

14 that's a question that we need to figure out.

15 MS. CARUSO: All right. I've got

16 John, Joseline, Mike and Linda and then I want

17 another check in.

18 PARTICIPANT: Forgive me for

19 backtracking a little bit. There was a

20 discussion of sort of administrative exhaustion. 

21 And to the degree that's part of the

22 discussion I think it's also worth considering
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

215

1 whether there's a formal role for trying to

2 leverage whatever state enforcement authorities

3 exist at that point, whether there's a formal

4 part of that process where for instance borrowers

5 could be asked to report any allegations of

6 misrepresentation, fraudulent conduct to relevant

7 state enforcement authorities or whether or not

8 there's a formal role in that process whereby the

9 Department to the extent allowed by all other

10 relevant laws, privacy laws and the like, can

11 report those allegations to the relevant state

12 enforcement authorities.

13 MS. GARCIA: So I know that earlier

14 there were requests made to not group schools

15 together and, you know, say that all schools are

16 bad schools. And I just want to put it out there

17 that I would request a similar thing for

18 students.

19 I feel like there has been some

20 comments that I don't appreciate about students

21 and their incentives for making claims. And

22 students having incentives that are in their
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

216

1 self-interests where they're not genuine or

2 they're not actually trying to better themselves.

3 So I would just put out that request

4 as well as not to group students intentions to

5 better themselves when they have been taken

6 advantage of. The second thing that I'll point

7 out that in terms of process I had a question for

8 the Department.

9 So you all have access to these claims

10 and within those claims there's probably some

11 trends of where they're taking place. And I'm

12 wondering if you all reach out to students who

13 are in those institutions and let them know like,

14 hey, there have been claims taking place from

15 these institutions because I do believe that

16 knowledge is power.

17 And I think it would be a proactive

18 measure or letting students become aware that

19 former peers have been found in a situation like

20 this.

21 MS. WEISMAN: We made a request to get

22 information about the outreach that was asked
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

217

1 this morning by Stevaughn. And as far as I know

2 we're still gathering some of that information.

3 So we can kind of group that question,

4 if you don't mind if we can kind of tag that onto

5 the earlier question and try to provide that

6 answer together.

7 MS. GARCIA: Okay, thank you. And

8 then just a really quick because we have all,

9 well not everyone, but it seems that the trend

10 that we want to do is to make this process simple

11 and easily understood for students.

12 I do think that, I would agree with

13 Abby's comment about being able to opt out. And

14 the second thing I know that Linda had mentioned

15 about students being in a position where they

16 have to exhaust their resources and speak to the

17 institution.

18 I also worry about the situation that

19 the student would be in there and whether they

20 would have all the resources necessary to get

21 into an agreement or a settlement with the

22 institution that they're dealing with.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

218

1 MS. CARUSO: Mike, Linda, check in.

2 MR. BUSADA: Just to address a couple

3 of points and see if we can just get some

4 clarification and maybe come to a little

5 consensus. One, going back to what Abby and I

6 think William talked about and I agree with you

7 don't want to force somebody to have to deal with

8 somebody that has, you know, done wrong by them I

9 mean in any situation.

10 I was wondering though would you be

11 open to, I mean a lot of you know, federal

12 programs whether it's Department of Labor or

13 other areas it's, there's a mediation process but

14 the mediation process is managed by, for instance

15 the Department of Labor.

16 So there is an intermediary trying to

17 bring the two together, making sure that nobody

18 is treated unfairly. And my thought there is

19 that the last thing, I mean I tell clients all

20 the time, you know, private clients outside of

21 school stuff that even when they a good claim

22 sometimes they say I want to go sue somebody.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

219

1 I say you can sue and you'll probably

2 win. But it's going to cost you a lot of money. 

3 It's going to take a lot of your time. A lot of

4 times people, if you sit down with them they'll

5 say hey, I was just mad about this. Let's come

6 up with a solution.

7 There are other times they won't. If

8 they're bad people, they're bad people. They're

9 not going to. But I just think that, you know,

10 we do a disservice to everybody I think if we

11 tell a student that, you know, we don't give them

12 an opportunity with someone from the Department

13 involved to try and come up with a solution.

14 I mean I think it would get both of

15 those, accomplish both of those. So something

16 like that is kind of a middle ground.

17 In terms of, and I do want to address

18 what Joseline said and I agree. We don't want to

19 say that anybody is bad or guilty. But I do want

20 to say this and I was the one that brought up the

21 original point about not grouping all schools

22 together.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

220

1 And so I want to be very clear. I

2 live, you know, I think we all have to agree just

3 pragmatically that any kind of entity you look at

4 whether its schools, charities, churches,

5 businesses there's good and there's bad.

6 There's always bad actors. I mean

7 there's always going to be bad actor whatever

8 you're looking in. I mean I think if anybody can

9 tell me, I mean I'm a lawyer, there are good law

10 firms there are bad law firms.

11 There's good charitable organizations,

12 there's bad charitable organizations across the

13 spectrum. I think we need to acknowledge that

14 education is going to be no different.

15 There's going to be good schools

16 regardless of what sector. There's going to be

17 bad schools. There are going to be most schools

18 we hope and our effort is to make them all good

19 schools and make sure we have all good schools.

20 I think we have to be realistic though

21 and say there are some people out there that have

22 no intention of being actual students. You can
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

221

1 look at indictments for trying to commit fraud.

2 And those aren't the people you

3 represent and I understand that. But I think we

4 need to be realistic in saying there's good

5 schools and bad schools. There's good potential

6 students, you know, there are good students and

7 there are people that aren't serious students

8 that have another ulterior motives.

9 MS. CARUSO: Mike, I just want to

10 limit the comments to the questions and the

11 issues at hand.

12 MR. BUSADA: Yes.

13 MS. CARUSO: And so I'm going to

14 redirect.

15 MR. BUSADA: Yes.

16 MS. CARUSO: Okay. Linda, please.

17 MS. RAWLES: Yes. I had really wanted

18 to clarify something before Joseline spoke and

19 now it's even more so. When I'm talking about

20 incentives I mean every rule creates incentives,

21 right.

22 I mean any rule that the Department
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

222

1 would write on this, any rule that we would come

2 up with incentivizes people and discourages other

3 behavior. Not to repeat too much, but what I'm

4 thinking of a student exhausting their remedies

5 or at least trying to settle the issue with the

6 school that could be a student with a legitimate

7 fraud complaint or it could be a student who is

8 just mad and has no legitimate complaint.

9 It's a mix. So if you have some kind

10 of precursor to a lengthy, expensive process that

11 allows us to sort that out a bit to figure out,

12 you know, you ask any of the accreditors, I won't

13 speak for Michael or others but anyone who works

14 with students realizes that most of them are

15 sincere and mean well, et cetera but that there

16 are some who don't.

17 And you get some frivolous complaints. 

18 So we're just saying it would be nice to have

19 something at the beginning if it's not an

20 exhaustion of remedies some kind of step that

21 helps us sort out legitimate complaints from non.

22 It's just as naive and wrong to say
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

223

1 that all the complaints are going to be

2 legitimate as to say all the complaints are going

3 to be illegitimate. They will be a mix.

4 MS. CARUSO: Okay. Understanding that

5 we still are on Issue 2 back to the Department to

6 direct us in any form or fashion you see fit,

7 areas where you want to explore within Issue 2.

8 MS. WEISMAN: I'd like to move to

9 Issue 2.3, what evidence should the borrower be

10 required to provide to support a borrower defense

11 claim?

12 MS. CARUSO: Abby, Joseline.

13 MS. SHAFROTH: Thank you. So in

14 working with borrowers who want to submit

15 borrower defenses I can tell you that they rarely

16 have evidence beyond their own testimony about

17 what happened to them.

18 There are some circumstances where,

19 you know, where they happened to still have a

20 handout or something. But for the most part they

21 get materials in the beginning, recruitment

22 materials and they throw them out because they
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

224

1 are not, they don't have any record retention

2 requirements and they're not holding onto things

3 thinking I'm going to have to prove a case one

4 day.

5 They don't think that they're being

6 taken advantage of and they're trusting

7 everything that they're receiving. So they're

8 not stockpiling evidence for a later claim.

9 In addition to that a lot of the

10 misrepresentations that occur or at least the

11 ones that I hear about are oral

12 misrepresentations. It's, you know, a borrower

13 is called by a recruiter or meets with a

14 recruiter on campus and it is at that point that

15 they are given misinformation about job placement

16 rates or they are guaranteed that they will get a

17 job or they are told that they, that their

18 expenses are all going to be covered.

19 Those sorts of things. These are all

20 oral misrepresentations where there won't be,

21 that borrower isn't going to have any other

22 evidence other than their own testimony.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

225

1 So for these reasons in order to make

2 sure that the process is accessible to those who

3 have meritorious claims but don't have other sort

4 of documentary evidence and of course don't have

5 subpoena power or anything to go after and depose

6 the institutions that they should be able to

7 support their claims with their sworn testimony.

8 And they can, you know, maybe it

9 should be signed under penalty of perjury or

10 something like that to ensure that it sort of

11 counts as testimony the way their testimony would

12 be evidence in a court of law.

13 And that, you know, in addition to the

14 borrower's own, whatever evidence the borrower is

15 able to submit the Department should also

16 consider evidence in its own records or evidence

17 submitted by state AGs or other enforcement

18 authorities and doesn't need to like just

19 consider the borrower's evidence in a vacuum.

20 And to the extent that the Department

21 does not credit a student's sworn testimony I

22 would say the Department should provide an
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

226

1 explanation in writing of what other evidence it

2 has that contradicts the student's sworn

3 testimony or what other reasons they have for why

4 they don't find the sworn testimony credible.

5 MS. GARCIA: I have a question for the

6 Department. External evidence that is made or

7 excuse me that involves like investigations or

8 judgments like how much of a weight do those have

9 for borrower defense claims?

10 MS. WEISMAN: So I think that really

11 the one set of claims that were filed from former

12 Corinthian borrowers are the only ones that we

13 can really speak to related to that.

14 There were a couple of other schools

15 that Mr. Manning mentioned this morning as well

16 that would fall into that where we had sufficient

17 information and that was really the majority of

18 what was looked at for those claims.

19 We have not really gotten into the

20 level of processing individual borrower claims

21 yet. So I can't speak to what might be the

22 process for those.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

227

1 I think in many of those cases they

2 were kind of put aside because we didn't have

3 that information for those. So where we have

4 good information I think we're using it.

5 But we're really trying to look

6 forward and say we want to create a process to

7 really outline what we would do and talk about,

8 you know, how useful is that. But in a lot of

9 cases I think we won't have it.

10 And so that's really what we're trying

11 to gather some more information on as well is

12 what happens when that information isn't

13 available to us.

14 MS. GARCIA: Thank you.

15 MS. CARUSO: Michael and then Aaron.

16 MR. BOTTRILL: Well thankfully my

17 agency doesn't receive a whole lot of student

18 complaints. But of those that we do I would say

19 they mirror what Abby described without much, if

20 any, documentation.

21 And I, you know, from experience will

22 say that makes it very difficult to, you know,
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

228

1 try to suss out what if anything can and should

2 be done. Oftentimes a student might claim that a

3 recruiter or admissions individual stated

4 something and what we'll get back in return is

5 well here it is where it's in the catalog on, you

6 know, page 56.

7 But in addition here's where the

8 student signed their initials and said they

9 received this information. And here's where it

10 says, you know, the specific, you know,

11 opportunity and, you know, has far greater

12 evidence that contradicts the student's claims.

13 So that makes it, I'm sure, a very

14 difficult process for the student, I mean for the

15 Department to try to again determine the truth of

16 the matter.

17 But I think at a minimum to Abby's

18 point there, because of those circumstances there

19 has to be, you know, at least some kind of

20 affidavit or sworn statement or something that, I

21 just don't think you're going to get much else in

22 these misrepresentation or substantial
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

229

1 misrepresentation claims.

2 When you get to the next bullet about

3 due process I think you'll have an opportunity to

4 talk also about the opportunity and how

5 "adversarial" you want to make it with regard to,

6 you know, how many times so and so gets to

7 respond back to the other person and the other

8 claimant and whatnot.

9 But, you know, again minimally I think

10 there has to be something where the student is

11 attesting to, swearing to the testimony that

12 they're providing.

13 MS. CARUSO: Aaron.

14 MR. LACEY: Yes, just following up on

15 those comments. Actually I would sort of

16 encourage that the Department aside from just

17 setting that floor which I think is consistent

18 with false certification, discharge and closed

19 school, I mean having to have a sworn statement

20 from the student.

21 But I would actually suggest not

22 penning yourselves into a policy corner by trying
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

230

1 to articulate anything beyond that. I mean

2 you've got a standard, you know, of proof.

3 You've got whoever it's going to be in

4 ALJ making or whoever making the decision. You

5 know, you've got the claim articulated. I mean

6 the responsibility of that individual is to

7 gather, you know, through the process and the due

8 process whatever evidence they have and to make

9 the decision they have.

10 And I don't, you know, I guess my

11 recommendation would be that you not try to

12 articulate some specific set of documents or

13 standards that have to be satisfied. I mean at

14 the end of the day you want a just decision and

15 you want that person to be able to gather

16 whatever they can.

17 So beyond the floor the certified

18 statement I would probably say, my suggestion is

19 not to try to articulate any particular pieces of

20 evidence that would be required.

21 PARTICIPANT: In the same vein as

22 Aaron's point I would actually say the opposite.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

231

1 And I would say you could give examples of what

2 might be considered evidence so that there's an

3 understanding of what the opportunity is to

4 provide that evidence.

5 But not, it doesn't necessarily paint

6 you into a corner if you give a couple

7 opportunities. So you might say, for example, a

8 sworn statement could be considered evidence on

9 and on and on though not saying exclusively that

10 those items would be the evidence required.

11 MS. CARUSO: Are we all set on

12 Question 3? Let's go to Question 4.

13 MS. WEISMAN: So Question 4 asks what

14 due process and notification requirements should

15 the Department provide to an institution of a

16 pending borrower defense claim and what

17 opportunities should be provided for the school

18 to respond to a borrower defense claim?

19 MS. CARUSO: The floor is open. 

20 Valerie.

21 MS. SHARP: I do think that

22 definitely, in order for due process to take
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

232

1 place, we do need to set something in the

2 regulation.

3 It was something that was not

4 clarified in the 2016 documents that there would

5 be a notification to the school, and the school

6 would have proper opportunity to respond and

7 provide documentation.

8 I don't know necessarily that it's a

9 matter of trying to pit the school against the

10 student, because both responses and things are

11 going through the Department of Education for

12 review, and that is protecting both interests at

13 the same time.

14 But I do think it is important for

15 schools to have an opportunity to be aware. If

16 nothing else, if it is an inadvertent mistake, it

17 allows them to catch it before anybody else is

18 harmed, but also have an opportunity to respond,

19 provide the documentation that they have.

20 And in the prior considerations, there

21 was given opportunity for students to appeal

22 decisions, but none for the institution to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

233

1 appeal.

2 So, I think we've talked about fair

3 and equitable, and we certainly want fairness for

4 the students, but we want a balance in

5 legislation as well to make sure that schools

6 have an opportunity to also share their side.

7 And as mentioned several times today,

8 most schools are responding on their own without

9 the backing of law firms in these cases.

10 Usually I am the respondent, and I do

11 not have a law degree. And so, it is important

12 to note that many times the schools are just

13 providing you with, the Department with the

14 information that they have in allowing the

15 Department to make the decision.

16 PARTICIPANT: Michael, Abby, and then

17 Kelli.

18 MR. BOTTRILL: So, this might be the

19 bifurcation of the bifurcation, which would be a

20 quadfurcation, and it goes to what we said before

21 about, you know, if it meets the definition of a

22 closed school, you go into this lane, whatever
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

234

1 that definition is going to be.

2 You know, precipitous closure, but

3 with an open school where there is an opportunity

4 for the institution to have notice and an

5 opportunity to respond, I think those are the two

6 lanes that you might want to consider as you're

7 thinking about crafting the process.

8 And so, in an abundance of fairness,

9 to give the institution notification and an

10 opportunity, I don't know that it needs to be,

11 again, a back and forth tennis match of

12 responding to the different responses.

13 I'll leave that up to the lawyers to

14 argue about, but you know, certainly notification

15 and an opportunity to respond would seem fair,

16 across for all parties.

17 PARTICIPANT: Abby.

18 MS. SHAFROTH: So, I'm not sure what

19 the due process would be beyond notification to

20 the school, or what's being proposed for due

21 process, if it's anything other than notification

22 to the school that a borrower has submitted a
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

235

1 claim.

2 To me, in terms of due process, if we

3 do have a bifurcated proceedings, if there is a

4 distinct process where a borrower can get relief

5 from the Department of Education, it's just

6 between the holder of the loan and the borrower,

7 and there's an entirely separate process where

8 the Department might decide it wants to seek

9 recoupment from the school, or it might decide it

10 doesn't want to seek recoupment from the school,

11 then I'm not sure that -- it's not clear to me

12 that schools would have any due process interest

13 with respect to the first proceeding, because the

14 outcome would not make them liable for anything.

15 It would only be if the Department

16 decided to conduct a second proceeding, that the

17 school's due process interests would be at play. 

18 So, I mean, my main concern here is I

19 want to make sure that the first process, the

20 process by which the Department can decide

21 whether to forgive a student's loans, isn't

22 adversarial in terms of between the student and
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

236

1 the school, and also moves at a reasonable clip.

2 If there's a lot of process points

3 where the school has 180 days to respond, and

4 then the student has time to review with what the

5 school's submissions, and then the school has an

6 opportunity to somehow appeal the decision, that

7 is about whether the Department should forgive a

8 student's loans.

9 That strikes me that it would really

10 slow down and burden the process for getting

11 students relief who really need it.

12 PARTICIPANT: Kelli.

13 MS. HUDSON PERRY: In an effort to try

14 not to echo what Valerie and Michael said, I do

15 want to just provide some context about what Abby

16 just said as well.

17 Where it becomes important from an

18 institutional perspective is when we get to Issue

19 Paper 3, and the determination of what the

20 liability is to that school.

21 So, if a claim is presented and the

22 liability does not come back to the school, there
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

237

1 may not be a situation where the institution

2 needs to get involved in that point other than if

3 it was somewhat of a mistake by an individual at

4 that institution, because there needs to be

5 clarification made at the institution so that

6 that mistake doesn't get made again. So,

7 processes might need to change at the school.

8 So, notification is important from

9 that perspective, but where it really becomes an

10 issue is if there's liability that the

11 institution is going to incur based on that

12 discharge.

13 PARTICIPANT: Linda, and then Aaron

14 and Dan.

15 MS. RAWLES: Due process is a very

16 important concept, and it's sort of like free

17 speech or some of our other rights.

18 All of our opinions change, I guess,

19 depending on where we are looking at it. But I

20 think we ought to really pay attention to this

21 issue.

22 The thought that -- first, of course,
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

238

1 I don't favor a bifurcated process, but if you

2 had one, and we were supposedly only looking into

3 whether the loan would be discharged, and not the

4 liability of the institution, that's a little bit

5 of a false paradigm, or quite a big false

6 paradigm, because the school has, if nothing

7 else, reputational liability.

8 The school has an interest from the

9 point someone says to the school, you committed

10 fraud, and so this person doesn't have to pay

11 their loan back.

12 So, the fact that due process to a

13 school, in that context, consists only of notice,

14 goes against any notion of due process or

15 fundamental fairness I've ever heard of.

16 What I've always told my clients is

17 make sure that, especially if they're private

18 schools, make sure you're at least giving

19 fundamental fairness, if not due process.

20 And even if you're not a lawyer, you

21 know, there are just different standards of how

22 much process you give somebody.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

239

1 So, let's say we're only going to give

2 a school fundamental fairness and not due process

3 from the beginning of the process, that usually

4 requires, or always requires notice, an

5 opportunity to present evidence, and a right of

6 appeal.

7 So, I think it's pretty obvious, if we

8 really mean that this process is going to be fair

9 to all parties, that the school needs to be

10 involved from the beginning with notice, an

11 opportunity to present evidence, and appeals. We

12 can argue the details of that later.

13 But to go any less than that, I think, 

14 goes against our goal of being fair to all the

15 parties involved.

16 PARTICIPANT: Aaron.

17 MR. LACEY: Yes. I mean, I hear very

18 clearly, and I agree that there is a great

19 interest for students in having a process that is

20 fast. I get that. But between fast and fair, I

21 think we have to go with fair every time.

22 And I echo Linda, I was going to make
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

240

1 essentially the same point. I will add that I

2 think that the regulation should specify that

3 both parties have a right to present evidence, a

4 time period in which to present that evidence, a

5 right to understand and review the evidence that

6 the student has supplied so that they can

7 respond.

8 But I think those, some of the things

9 that were lacking in 2016 version, in my view,

10 were some guaranteed time frames, the opportunity

11 to provide that evidence, the guarantee that the

12 evidence would be considered by the arbiter,

13 those types of things.

14 So, and I think whether you have a

15 bifurcated process or a single process, which I

16 prefer, either way, you've got to have those

17 things from the very beginning, for school and

18 for student.

19 The other point I wanted to make is,

20 if we decide to move in a direction of permitting

21 or contemplating a group process, I think that

22 the due process afforded institutions, in that
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

241

1 context, and students, has to be greater in the

2 group process, because the stakes, conceivably,

3 can be very, very high for an institution.

4 So, if we decide in the individual

5 claim process to try to go lean and afford sort

6 of the minimum amount of due process to

7 institutions to, for the sake of expediency, I

8 think, in the group process, we need something

9 more like what looks in January, you know, in the

10 regulations that were provided there.

11 And I also don't know if, in the group

12 process, you would have a departmental

13 representative advocating on behalf of the group,

14 in which case, all the more reason that would

15 probably look a lot more like Subpart G, you

16 know, in the process that was laid out in

17 January.

18 PARTICIPANT: Alyssa, Ashley Reich,

19 Danny, Michael, and then check-in, which could

20 mean a break.

21 MS. DOBSON: I'm just having

22 difficulty understanding how the Department would
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

242

1 be able to arrive at a decision to grant the

2 defense to repayment claim without input from the

3 school.

4 I deal with students all the time, and

5 they'd say something like, well, this professor

6 did this to me.

7 As soon as I get feedback from the

8 professor, it quickly becomes apparent as to, oh,

9 I see why you thought that, but here's what

10 actually happened.

11 So, maybe you could help me understand

12 that, but I don't see how the Department could

13 even arrive at a decision without input from the

14 other party.

15 Oh, the other thing is that I don't

16 think it would have to be a long process. 

17 Working in a school all the time, the Department

18 commonly gives us deadlines for reporting things

19 back that aren't an extraordinarily long window. 

20 So, we're used to quick turnaround times and

21 providing documentation quickly.

22 PARTICIPANT: Ashley Reich.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

243

1 MS. REICH: In an effort not to

2 repeat, I agree. And the Department, I believe,

3 and the OCR, when they send a request, I think we

4 have maybe five days for a turnaround.

5 So, I would say that those type of

6 standards would probably remain. I could never

7 imagine a situation why the Department would, you

8 know, ask for 120 day turnaround.

9 So, I think that those sorts of

10 standards, that shortened time frame, would

11 probably be appropriate here because you already

12 have that standard.

13 You already asked that of the

14 institutions to provide that. And then, I just

15 echo everything else you just mentioned.

16 PARTICIPANT: Danny.

17 MR. FLANIGAN, JR.: Okay. Hopefully,

18 I won't repeat what other people have said, but I

19 do think the process has to be fair, both from

20 the student's side, as well as from the college.

21 PARTICIPANT: Do you want to get

22 closer to the mic?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

244

1 PARTICIPANT: Thank you. I do, I do

2 think the process has to be fair, both from the

3 student's side, as well as from the college side. 

4 And you talk about due process of

5 fairness, I think in fairness, you have to notify

6 the college when a student makes a claim, about

7 what the claim is.

8 And I heard someone talk about five

9 day turnaround, a 30 day turnaround, 180 day

10 turnaround. I think a turnaround should be

11 quick, like 5 to 10 days, and I think that the

12 Department has to involve both the student and

13 the college in the process of making decisions to

14 what they're going to do.

15 PARTICIPANT: Michael, you're all set? 

16 All right. So, Abby and then, and then we'll

17 have a check-in.

18 MS. SHAFROTH: Sure. I just wanted to

19 clarify that my position wasn't that the

20 Department shouldn't be able to get information

21 from the school to consider.

22 By all means, I wouldn't tie the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

245

1 Department's hands in investigating a borrower

2 defense claim. It's simply that I wanted more

3 clarity around -- it's two points.

4 That, one, when we're deciding whether

5 the Department should decide to forgive a

6 student's loans, then I don't think that the

7 school has a due process interest in that

8 decision.

9 I think their interest is in whether

10 the Department is able to hold them liable or to

11 recoup from them.

12 And second, that if we're going beyond

13 notice to the school, that I'm wary of trying to

14 create a process where the institution has more

15 procedural rights in the decision of how to

16 allocate funds between the Department of

17 Education and a student borrower, especially if

18 we're beginning to talk about appeals of the

19 decision, a decision that is between the student

20 and the borrower.

21 If the institution isn't a party to

22 the decision, I am not sure why or how they
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

246

1 should appeal that, and that makes it sound, if

2 we're talking appeal, that makes it really sound

3 like an adversarial process between the student

4 and the school, which, again, I won't repeat

5 myself, but it's going to be very hard for any

6 student to navigate.

7 PARTICIPANT: Okay. Mike, you have

8 something on due process?

9 MR. BUSADA: No, and I completely

10 understand where Abby's coming from. The one

11 thing that I would say though is that, if you are

12 a smaller institution and you have a student that

13 goes, and the loans are forgiven, and they come

14 back to a small town like many of us live in and

15 they go to the newspaper and say, the Department

16 of Education agreed with me that fraud was

17 committed on me.

18 If we have one student do that in our

19 small town, we're done. You shut it, I mean,

20 Katie, close the doors, because it would have

21 such a big effect.

22 And so, that's the only place that I
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

247

1 would argue that I think it does have an effect

2 on the school, because if you're a small school

3 in a small town, their reputation is all you

4 have.

5 PARTICIPANT: Okay. We can take Dan

6 and Bryan.

7 MR. MADZELAN: No, just to reiterate

8 that, you know, every institution faces at least

9 financial risk, as well as reputational risk.

10 And even if there is not a financial

11 risk in a particular circumstance, a college or

12 university can certainly be facing reputational

13 harm in that circumstance.

14 MR. BLACK: One of the things that

15 we're very cognizant of is, for example, I went

16 on the internet and typed in student loan

17 discharges, and Student Loan Hero came up.

18 And you know, when we talk about a

19 reputation, of a school having a fine reputation,

20 but having something like that happen in a small

21 college setting, it becomes devastating, just as

22 Michael was saying. Let me give you some little
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

248

1 insight, and the way, for example, grievances are

2 handled.

3 As an attorney, you have a request for

4 investigation that's done through a written

5 response.

6 Following that, if they find that

7 there's a threshold merit that's been met, then

8 it goes to a mediation of three attorneys who

9 look at all the facts and the evidence. And

10 then, if they find it's warranted, then it goes

11 to a commission at the last stage.

12 So, there's always a tremendous amount

13 of due process in everything, and to suggest

14 anything less than that, especially in light of

15 our climate, where we have really seen where

16 students don't necessarily have a complaint

17 against our school, but they want to be

18 discharged of the debt. And so, that's a big

19 concern of ours. Thank you.

20 PARTICIPANT: So, sounds like we are

21 wrapping up Question number 4. So, back to the

22 Department, it sounds like we've heard some
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

249

1 responses to Question 5 in the course of our

2 conversation. Anything left there? And how

3 about number 6?

4 PARTICIPANT: The other thing I do

5 want to point out though, for Item 6 is, talking

6 about the opportunity for borrowers with other

7 federal loans to consolidate the loans into the

8 Direct Loan Program, we want to remind people

9 that, yes, we are already doing this as a

10 process, but we want to remind people that a

11 consolidation loan is a new loan.

12 So, we would want to consider that as

13 our discussion is framed here, that any language

14 we write, we'd want to make sure, if you wanted

15 to include then that consolidation loan, which

16 presumably you would, that that would need to be

17 written into language.

18 Because again, it becomes a new loan,

19 so the underlying loans are no longer what we

20 would consider.

21 So, it's just a point of

22 clarification, and happy to hear your thoughts on
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

250

1 that, as well as if you do have anything left on

2 Item 5, Bullet Point 5, whether the school is

3 open or closed and needing a separate process.

4 PARTICIPANT: Okay. Assuming Bryan's

5 tent is ready to go down, Alyssa, and then Wanda,

6 and then Abby.

7 MS. DOBSON: I think consolidation is

8 an, is an important piece to remain in there, but

9 my concern or question, or both, is would there

10 still be a process to parse out which loans

11 within that consolidation loan were subject to

12 the misrepresentation, or if a student had a

13 misrepresentation claim and consolidated, would

14 loans that were completely unrelated end up being

15 forgiven in that process?

16 PARTICIPANT: And my understanding is

17 that there is a way to do that, but that is some

18 of the delay in regards to the current process

19 that we're using, that some of the ones that are

20 taking longer to discharge than others, Mr.

21 Manning referenced that this morning, that that's

22 part of one of the reasons why that can happen.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

251

1 PARTICIPANT: Wanda.

2 MS. HALL: A little bit back on 5, the

3 distinction, when you're looking at closed

4 schools is you're going to, you're still going to

5 have borrowers that are not going to be eligible

6 for the closed school discharge because of the

7 timing criteria. So, then you have another, I

8 guess another exit ramp or something, or go this

9 way scenario.

10 PARTICIPANT: Abby.

11 MS. SHAFROTH: I'm glad it sounds like

12 the Department is interested in ensuring a path

13 to forgiveness for student borrowers whose loans

14 are in the FFEL program, as opposed to the direct

15 loan program.

16 Since borrowers generally haven't

17 chosen the origin of their loans and which type

18 they get, it's very important to ensure that

19 borrowers with FFEL loans have an opportunity to

20 relief.

21 My preference would be to also revise

22 the FFEL regulations to provide those borrowers
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

252

1 with a direct path to leave, relief, without

2 having to go through the consolidation process.

3 But if, you know, as a sort of second

4 best, if the Department is not willing to go that

5 route, allowing a consolidation process and to

6 treat that direct, new Direct Consolidation Loan

7 as eligible for relief is very important.

8 This also though raises the issue of

9 refunds for amounts that the student already

10 paid. I would strongly counsel in favor of

11 finding a way to provide borrowers who had FFEL

12 loans and who have already had amounts paid or

13 collected on those FFEL loans before getting a

14 discharge with a way to get refunds of those

15 amounts.

16 PARTICIPANT: I do think that the

17 consolidation is a, is a good idea because if the

18 student has loans, they have loans, right?

19 And the idea is that we're discharging

20 them from payment based on some type of

21 misrepresentation.

22 I guess the part that I don't
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

253

1 understand is why would we make them go through

2 the consolidation process in order, before that

3 discharge is granted?

4 PARTICIPANT: There are some legal

5 barriers to discharging it directly from the FFEL

6 program, and that was the work around that we

7 were able to come up with to try to provide some

8 parity.

9 PARTICIPANT: Ashley Reich.

10 MS. REICH: When it comes to

11 consolidation for those that had older FFEL

12 loans, it actually may be advantageous for them

13 to consolidate because they could get a lower

14 interest rate.

15 And when we've been talking about

16 administrative forbearance and interest, you

17 know, capitalizing or continuing to accrue, you

18 know, while the student is waiting for their

19 particular application to be processed, that

20 actually might help them.

21 Like I said, especially if they have

22 a lower interest rate. So, just something to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

254

1 consider there.

2 PARTICIPANT: Wanda.

3 MS. HALL: I think one thing that we

4 have to be cautious of is that, generally, what

5 you'll see happen, the borrower may consolidate

6 all of the loans they have.

7 And so, maybe they have some loans

8 that are legitimate. Loans they don't, you know,

9 they're not going to be dischargeable. Let's put

10 it that way.

11 If they're working towards a

12 forgiveness plan, then if they consolidate, then

13 that counter is back to zero again. So, it comes

14 down to counseling as well.

15 PARTICIPANT: Jaye.

16 MR. O'CONNELL: I seem to recall, the

17 last time, that there was a pre-qualification

18 process through the Department.

19 So, if someone did not have a

20 consolidated FFEL loan, that they would be

21 advised to consolidate as a result of being

22 approved for discharge. So, I think that could
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

255

1 help with the loss of benefits.

2 PARTICIPANT: Abby.

3 MS. SHAFROTH: I don't think that this

4 is addressed in the regulations that weren't

5 delayed and didn't go into effect, but just as a

6 technical point, there have been some FFEL

7 borrowers who aren't eligible to consolidate into

8 a Direct Consolidation Loan, including those who

9 currently have a FFEL consolidation loan and are

10 current on it, are not in default.

11 Unless that was already changed and

12 I'm forgetting it, I would encourage the

13 Department to also amend those regulations to

14 permit borrowers who have FFEL consolidation

15 loans to consolidate into a Direct Consolidation

16 Loan in order to be able to access this path to

17 relief.

18 PARTICIPANT: All right. Looking for

19 any final comments on Issue number 2. We are

20 going to move towards a break after, Joseline?

21 MS. GARCIA: Sorry, I had to step out. 

22 So, if I could just quickly take it back to the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

256

1 due process of notification to the institution of

2 a pending BD claim.

3 So, I have a question to the

4 Department. So, if a school were to get notified

5 of the pending BD claim, would the name of the

6 student be given to the institution?

7 PARTICIPANT: I think right now, we're

8 here more as a listening session, so we're here

9 to hear your ideas of what you would like to see

10 in this. We're open to your feedback.

11 MS. GARCIA: Okay. So, that being

12 said, I would worry about that. If an

13 institution found out, like, who the student was

14 and, again, putting it out there, that some

15 schools are bad and some schools are good.

16 I could see some forms of intimidation

17 or reaching out to the student while this claim

18 is pending.

19 And obviously, the institution is

20 looking for their self-interest, and the student

21 could be at risk for other behaviors.

22 PARTICIPANT: Will, and then Alyssa.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

257

1 MR. HUBBARD: In response to that, I'd

2 recommend that the Department consider having an

3 opt in option to include the name, otherwise it

4 would be anonymous as a potential concern.

5 MS. DOBSON: Without an identifier,

6 the school would have no way of which to verify

7 or provide information about timing of

8 enrollment, the information that was being

9 provided at that time, the placement rates at

10 that time, if the student changed their major,

11 when they started, did they culminate in a

12 degree, and any of those really, really important

13 things wouldn't be identifiable.

14 PARTICIPANT: Aaron, Linda, and

15 Michael.

16 MR. LACEY: Yes, it's a fundamental

17 component of due process that you can confront

18 your accuser.

19 Now, you know, there are

20 accommodations that are often made, particularly

21 in sensitive issues. I'm not suggesting they

22 should actually be able to confront the person,
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

258

1 but the reason for that is because, you know, to

2 the point that was just made.

3 And I get the sensitivity, but there

4 is no way an institution could defend itself. 

5 And I understand for scumbag institutions that

6 have done wrong, this is a crappy outcome.

7 But for institutions that haven't done

8 anything wrong, there's no way they can defend

9 themself if they don't know who it is.

10 And I think in the existing processes

11 at the Department, closed school loan discharge,

12 false certification discharge, you always know

13 who the student is because it's the only way the

14 schools can provide evidence and respond.

15 So, it would be totally consistent

16 with existent processes to supply the name of the

17 student.

18 PARTICIPANT: Linda.

19 MS. RAWLES: I'm trying not to repeat. 

20 I do agree with Aaron, but you absolutely have to

21 have that as a component of due process.

22 But what you can add is an anti-
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

259

1 retaliation provision so that if either party

2 does something in retaliation, that's an

3 additional claim. So, you know, that's something

4 that people deal with all the time.

5 PARTICIPANT: Thank you. Michael, and

6 then Danny.

7 MR. BOTTRILL: The anonymous

8 complaints that our agency, and I think other

9 accrediting agencies receive are extremely

10 difficult to, again, suss out the truth of any

11 matter.

12 It just makes it impossible for the

13 institution to be able to find any relevant

14 information about the claims being made.

15 MR. FLANIGAN, JR.: I would agree with

16 Linda and Michael, and Alyssa. It would be

17 impossible for the college to amount a defense if

18 it had no idea who it's dealing with. So, you

19 have to give us the name.

20 PARTICIPANT: Okay. Dan and Aaron,

21 are you taking, thank you.

22 PARTICIPANT: Yes, I said a moment ago
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

260

1 that, all institutions face reputational as well

2 as financial risk, and I'm wondering, maybe Aaron

3 can help me out here.

4 The other thought I had, and I don't

5 know sort of which way this plays, but you know,

6 bond rating agencies certainly take a look at

7 institutions and their balance sheets and assets

8 and liabilities.

9 And I'm just wondering if institutions

10 are not notified, is that an unknown that plays

11 one way or the other with the colleges' cost of

12 capital?

13 Or, again, I raise that question

14 because I don't know. But I do know that

15 investors are very risk averse.

16 PARTICIPANT: Joseline, and then back

17 to Danny.

18 MS. GARCIA: So, I do want to say I

19 appreciate the comments and perspectives that you

20 all brought.

21 And I do also want to respect due

22 process and the schools and institutions to be
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

261

1 able to defend themselves.

2 Again, just looking out for the

3 students, I'm not a lawyer, so I don't know what

4 exactly this would look like, but brainstorming

5 ways that we can ensure that students are

6 protected, and that they do not be taken

7 advantage of during that procedure. And it might

8 be an external entity. I don't really know.

9 PARTICIPANT: Sure. That's a valid

10 concern. Thank you. Danny, you're good? Okay. 

11 So, Valerie, and then Kelli.

12 MS. SHARP: I just wanted to respond

13 to Joseline, and just let her know that in cases

14 where students have filed complaints and were

15 given the names, the Department is involved and

16 watching to ensure that nothing untoward happens

17 to those students, and that both sides can

18 respond, but both sides are also protected in the

19 process.

20 And so, that is important for the

21 students to be protected, but the Department is

22 involved in ensuring that that happens throughout
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

262

1 the process. And so, I think that is happening

2 today.

3 MS. HUDSON PERRY: This, some --

4 PARTICIPANT: Quickly, just to answer

5 your question, a retaliation claim or a whistle

6 blower's claim is a lot for fearsome to a school

7 than what we're talking about here.

8 I mean, that's one of the easier

9 causes of actions to prove is a whistle blower's

10 claim. So, students, quite honestly, would be

11 protected.

12 That's the last thing a school would

13 want is to know a student brought a legitimate

14 concern and they were retaliated against as a

15 result of that.

16 So, I think there's built in

17 mechanisms already, and are jurisprudence to

18 handle that, if that helps you with your answer.

19 PARTICIPANT: All right. Kelli, and

20 then we're going to try to wrap it up on Issue 2.

21 MS. HUDSON PERRY: Just to further

22 comment on Dan's comment about assets and
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

263

1 liabilities, it's important that the institution

2 know the name of the, of the individual because

3 they're going to have to evaluate the status of

4 that claim and whether or not that claim is

5 probable.

6 So, when we get to Issue Paper 3, and

7 we talk about whether or not there's any

8 financial liability for that institution, we then

9 need to be able to determine whether or not that

10 should be recorded on the financial statements of

11 the institution as a potential liability.

12 So, it would be almost impossible to

13 not know who that student was so that we could

14 determine that probability.

15 PARTICIPANT: Lodriguez.

16 MR. MURRAY: Representing the minority

17 students, the institutions that they serve, I

18 have to say that an institution would have to

19 have a lot of moxie to try to intimidate a

20 student after they've initiated a claim with the

21 Department of Education.

22 And you've got realize what's at stake
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

264

1 for the institution. It's more than just their

2 reputation. Institutions want to continue to

3 have a relationship with the Department of

4 Education, without which, they won't exist.

5 And so, intimidating a student after

6 they bring a claim and initiating the kind of

7 thing that some around the table are apprehensive

8 of is just almost unconscionable.

9 It's just the biggest snowball an

10 institution could ever find themselves in. And

11 so, I understand some of these concerns.

12 We're representing both institutions

13 and students, and we're very sensitive to your

14 needs.

15 But I want to assure you that if

16 you're looking for something that's evenly

17 weighed, where institutions can defend themselves

18 if they have a leg to stand on, and students can

19 voice their concerns, which are legitimate

20 concerns because they're the reason why we're

21 here today, then you've got to allow some kind of

22 an avenue for this to move forward and the names
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

265

1 to go forth, because schools, real good schools,

2 are just never going to engage in the kind of

3 thing that you're concerned about.

4 PARTICIPANT: Okay. We'll hear from

5 Will.

6 MR. HUBBARD: It'll be one second.

7 PARTICIPANT: Briefly, if possible.

8 MR. HUBBARD: It'll be very, very

9 quick. So, the point that was made, and which I

10 fully appreciate, is that good schools would

11 never do that, bad schools will always do that.

12 MR. MURRAY: Short reply. No one that

13 wants to continue the relationship that's

14 necessary with the Department of Education would

15 ever engage in that kind of thing, whether you're

16 good or bad, because good and bad are looking for

17 the same thing in their --

18 PARTICIPANT: Thank you, folks.

19 MR. MURRAY: -- relationship with the

20 Department.

21 PARTICIPANT: Thank you. All right. 

22 I believe we are wrapping it up on Issue 2. 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

266

1 Anything left in the questions that the

2 Department feels need an answer?

3 PARTICIPANT: No.

4 PARTICIPANT: You're good on Issue 2?

5 PARTICIPANT: We're fine. Thank you.

6 PARTICIPANT: Okay. We are going to

7 take a 15 minute break. It is now 3:00. Please

8 come back at 3:15. Nice work, everyone. Thank

9 you for the progress.

10 (Whereupon, the above-entitled matter

11 went off the record and resumed following a brief

12 recess.)

13 PARTICIPANT: Okay. So, getting

14 started again, just to congratulate the parties

15 on the process made this afternoon, and to note

16 that, conceivably, if we get five questions

17 addressed this afternoon, then we are halfway

18 through the Issues. With that in mind, can we

19 have the Department start to address Issue 3,

20 summary?

21 PARTICIPANT: Yes. So, the issue here

22 is financial responsibility and administrative
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

267

1 capability.

2 So, under the Higher Education Act,

3 the secretary establishes standards for financial

4 responsibility and administrative capability that

5 institutions need to meet in order to participate

6 and receive Title IV funding.

7 We've mentioned here that if an

8 institution violates these requirements, the

9 secretary may, what refer to as an LS&T, limit,

10 suspend, terminate, and/or otherwise set

11 conditions on the institution's participation in

12 the programs.

13 So, for the current regulations that

14 we have in 685.206, borrower defense discharges

15 are granted when a borrower can show that an

16 institution committed a violation of applicable

17 state law.

18 When we discharge those loans, the

19 taxpayer is the one who pays on those loans. 

20 That then brings up the issue of where we should

21 hold the institution liable for recovery of those

22 funds. So it's, should we do that? If so, how? 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

268

1 We've already had some discussion

2 around the idea of reputation, and what the

3 allegation of a claim could do to an

4 institution's reputation.

5 We want to be mindful of issues that

6 could increase the likelihood of an institution

7 to close, especially to close rapidly.

8 We also want to consider the idea of

9 schools that are having difficulty already, may

10 then have difficulty repaying liabilities for

11 claims.

12 So, we want to keep those things in

13 mind, and then say, what should we, as the

14 Department, do? How do we handle the issue of

15 financial responsibility?

16 In the past, when we regulated this

17 issue, we talked about the idea of posting

18 surety. So, typically, that's done in the form

19 of a letter of credit.

20 We also talked about the idea of

21 offset. There are other strategies that we could

22 talk about, so we'd like to know, is that
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

269

1 something that the Committee feels is worth

2 pursuing? Again, if so, how?

3 So, questions for consideration, I

4 think 1 and 2 kind of come together for us. The

5 first one is under what conditions, or to what

6 extent, should institutions incur liability for

7 reimbursement of borrower defense claims?

8 And the second one is should the

9 Department require the posting of surety by

10 institutions determined at risk for closure,

11 and/or, I'll say significant borrower defense

12 claims? If so, what metric should be used when

13 you're making these determinations?

14 PARTICIPANT: Does anyone want to

15 start us off?

16 MR. FLANIGAN, JR.: I do.

17 PARTICIPANT: Danny?

18 MR. FLANIGAN, JR.: I have a question

19 for the Department. There are some financial

20 responsibility ratios that higher education has

21 to its advantage now, and for its use.

22 Those ratios are being looked at,
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

270

1 probably redefined by the Subcommittee on ratios. 

2 So, my question is if we come up with some

3 metrics based on how institutions should be

4 judged and looked at, or penalized, or sureties

5 raised, and et cetera, are we looking at the old

6 standards of financial standards, or are we

7 looking at the new standards, which we've never

8 seen yet?

9 MS. WEISMAN: I can clarify that. 

10 Keep in mind that, first of all, anything the

11 Subcommittee does is a recommendation.

12 So, everything that they do is

13 reported out in some way, here. This Committee

14 is the decision making body. They are not a

15 decision maker.

16 So, also to clarify, they are not

17 really looking at the same things we're looking

18 at.

19 So, we'd ask you to look at the effect

20 on a composite score as it stands today with the

21 understanding that they are looking strictly at

22 FASB standards, the Financial Accounting
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

271

1 Standards Board.

2 So, they're not looking at the things

3 that relate back to borrower defense. They are

4 looking at some very unique situations that

5 affect the composite score.

6 But I think anything we do here would

7 not have overlap on those things. If that were

8 to occur, we could certainly review that again,

9 but I think that the decisions that we need to

10 consider here, or the questions that we need to

11 consider here are unique enough that we can get

12 some feedback now.

13 But again, we can always revisit if it

14 yields, if the Subcommittee issue work yields

15 some additional questions for us.

16 PARTICIPANT: Okay. Kelli, Dawn, Dan,

17 Michael.

18 MS. HUDSON PERRY: To kind of echo

19 what I had said earlier about kind of a two

20 pathway approach, I think there needs to be

21 consideration, obviously, if a school is closed,

22 and the reason for that, the fact that that
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

272

1 school closed.

2 However, with that, if an institution

3 is found to be misrepresenting something where

4 the discharge is appropriate, I do think that the

5 institution should be held liable for the

6 discharge of those loans.

7 However, the institution needs to be

8 able to participate in that process, and not go

9 so far as an appeal, because hopefully they're

10 included at the process from the very beginning,

11 but if they're not, they need to be able to

12 appeal that process to make sure that their claim

13 or their defense is part of that record before

14 that discharge actually happens.

15 Tying this borrower defense issue to

16 financial responsibility, as the way that the

17 current rule is written, is difficult, because

18 with the current ratios that are calculated in

19 their current format, and I understand the

20 Committee's going to talk about the new FASB

21 requirements, as it relates to those.

22 There's issue with the calculations as
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

273

1 they currently exist in the fact that the

2 Department is not being consistent in their

3 interpretation of those across schools, and also,

4 from the perspective of -- there's not clear

5 interpretation of what the accounting rules

6 actually say.

7 So, for example, you have schools out

8 there that will pass the financial responsibility

9 ratio and probably are not financial responsible,

10 and you also have schools out there that are

11 failing that financial responsibility ratio who

12 are not at risk of closure, and won't be.

13 So, to tie these two together, I think

14 there needs to be a very clear distinction of the

15 difference between whether or not a student, or

16 an institution is considered financial

17 responsibility based on that score, and what

18 surety the institution would be expected to

19 provide, based on borrower defense.

20 Because, at the time, you don't know

21 what the potential liability is. So, to ask an

22 institution to provide surety, in what amount?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

274

1 You know, it's going to be different

2 for all institutions. You could have some

3 institutions where I think the 2016 rule had a

4 materiality threshold of $750,000.

5 For some schools, that's not material. 

6 For others, that's very material. So, without

7 having a hard number to say, this is your

8 potential liability, as it relates to borrower

9 defense, providing surety behind that is very

10 difficult to quantify.

11 MS. ROBINSON: So, Kelli just echoed

12 my sentiments, but I want to add one other thing. 

13 When we talk about the rule, the rule fails to

14 establish clear standards for how the relief and

15 recovery will be calculated, and that's going to

16 lead to significant inadequacies, inequities, if

17 borrowers and institutions are treated

18 differently. So, I would like for the Department

19 to respond.

20 MS. WEISMAN: I think we're at the

21 point where we're trying to gather information

22 from you, so we'd like to hear what you would
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

275

1 propose as an alternative to that from happening.

2 MS. ROBINSON: I would like to take

3 some time to think about that and come back and

4 answer, but one alternative that I do think that

5 we can look at when we talk about fairness is, if

6 you're going to have an institution be held

7 liable for a claim, then we really need to start

8 looking at the rules and the tactics, and maybe

9 tactic is the wrong word.

10 But we need to come up with something

11 that's uniform, and I think we also probably

12 should have two different avenues and I don't

13 want to call anyone out, but I think for privates

14 and HBCUs, you might look at one list of

15 standards, and then for for-profits, look at

16 something else.

17 PARTICIPANT: Dan.

18 MR. MADZELAN: A long time ago, I

19 worked at the Department of Education, and my

20 first boss came to Washington to get the National

21 Defense Student Loan Program, now the Perkins

22 Loan Program, up and running.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

276

1 And he told a story that after a

2 couple, three years, they realized, we have a

3 loan program and there's got to be repayments of

4 those loans, and we don't know anything about

5 that, and we don't know anything about what we

6 should expect from borrowers. Let's go ask some

7 people who do know. So, they met with some

8 bankers.

9 And so, they explained the program to

10 the bankers, and the bankers said, let's get this

11 straight. You're lending money to 18 year olds

12 with no employment history, no credit history, no

13 collateral, no cosigner?

14 Yes, that's right. Any default rate

15 less than 100 is good. So, and now, today, we

16 have a program that is also an entitlement.

17 Colleges and universities, except in

18 some limited cases, a case by case basis, cannot

19 say no. You are in an eligible program. You are

20 otherwise eligible, not in default. You fill out

21 a FAFSA, all that kind of stuff. Here's your

22 loan.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

277

1 So, now I think what the Department is

2 looking for some information on, is whether or

3 not, in this regulation, we should establish some

4 sort of risk sharing scheme.

5 Colleges and universities cannot limit

6 lending. One of the things that the Department

7 can do is perhaps a more vigorous job on the

8 front end, some of their gate keeping activities

9 to identify colleges that maybe are not up to

10 standards.

11 But instead, what is being proposed,

12 I won't say being proposed, what is here for

13 discussion is, again, as I say, some kind of risk

14 sharing scheme, to have colleges and universities

15 cover some portion of successful borrower defense

16 claims.

17 Well, with any risk sharing scheme,

18 you have to be prepared to address two issues. 

19 If you're not careful in the construction of,

20 well, you need to address the issues so you can

21 be careful in the construction of your scheme. 

22 Number one, it'll raise prices for colleges. 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

278

1 Somebody's got to pay.

2 If the college is paying something to

3 the Department of Education, that's one. The

4 other one is, a response from a college that is

5 likely is limiting access.

6 So, again, somebody has to pay, either

7 in a dollar and cents way, or in a reduced

8 opportunity way.

9 So, again, these are the kinds of

10 issues that, over the recent past, that the

11 relevant congressional committees have been

12 struggling with, as well.

13 My last comment is, in the Issue Paper

14 there's a statement that excessive borrower

15 defense claims may be an indication of an

16 increase in the likelihood of an institution

17 closing.

18 And of course, that's what our

19 financial responsibility standards are about, to

20 help prevent the sudden and precipitous closure.

21 I'm just wondering if anyone has any

22 evidence that a borrower defense claim, or
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

279

1 something like that, is an indication that a

2 college or university is in immediate danger of

3 closure.

4 And I say "something like that"

5 because we know there have been instances where

6 there have been some what we call, well, the

7 private label loans, non-federal student loans,

8 where institutions have been effectively

9 guarantors and, you know, writing off --

10 PARTICIPANT: Dan, just because of the

11 time that's elapsing, can we get a direct answer,

12 either to Question 1 or to 2? Under what

13 conditions or to what extent, or should the

14 Department require the posting of sureties?

15 MR. MADZELAN: I think, unless the

16 Department can come up with a scheme that ensures

17 non-negative outcomes in terms of price and

18 access, that is something that they should not

19 pursue.

20 PARTICIPANT: Michael.

21 MR. BOTTRILL: So, with regard to

22 Bullet number 2, more than one, you had Annmarie,
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

280

1 mentioned that the posting of surety that you

2 used, the Department uses now, is in the form of

3 the letter of credit.

4 And I don't have any experience with

5 any other kind of surety that I've seen the

6 Department use.

7 So, by putting that forward, I'm

8 assuming that you're looking potentially at

9 opening up to other kinds of sureties, like a

10 bond or some other kind of opportunity.

11 And where there can be some difficulty

12 with that goes to the point that, I think Kelli

13 made, which is that the current metric that's

14 used for financial responsibility needs some

15 work, and I'm glad that that's going to happen

16 through the Subcommittee and through this

17 Committee.

18 And it also seems to be fairly binary. 

19 If you're below the 1.5 composite score, you move

20 into, you know, the heightened cash monitoring.

21 And whether you're at 1.4 or -0.5,

22 there may be some degree, and there's some
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

281

1 gradation to the percentages that you may have to

2 pay, or some gradation to whether you're going

3 to, immediately into HCM2, but maybe there could

4 be some thought about additional gradations

5 within that composite score so it doesn't feel as

6 binary or as limited as it, as it may be.

7 And I, well, what I think that we see,

8 because we use the composite score as an

9 accrediting agency because it, to parallel with

10 the Department and not create an additional

11 burden.

12 And essentially, we see institutions

13 "managing to the composite score". So, they, you

14 know, move money in ways that, you know, give

15 them the best opportunity to make that.

16 And it's not always a great indicator

17 of the full financial health of an institution. 

18 And we've seen, on more than one occasion,

19 precipitous closures from institutions that just,

20 three or four months earlier, had reported, you

21 know, greater than 1.5 composite scores and we

22 completely missed it because we just didn't see
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

282

1 the financial stress that was there.

2 So, again, I'm happy that that's going

3 to be looked at. The last thing that I'll say is

4 maybe there's more opportunity for the limit, as

5 opposed to just suspend and terminate.

6 And I think that, again, this goes

7 back to my idea around gradation and

8 differentiation, which is one of the things that,

9 in the accreditation community, we've been

10 talking a lot about differentiation and

11 accreditation.

12 And so, that's not so binary, and I'm

13 not fully convinced that we'll get there fully,

14 but it's something that we're talking about.

15 Maybe there are ways, and I know it's

16 difficult because it's an entitlement, and I know

17 that folks around the table have already said,

18 well, you can't limit a student.

19 But maybe there are limit actions on

20 the institutions to the extent of how much more

21 liability, how many more loans can be given out

22 at that institution when some kind of distress
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

283

1 has been identified, when some kind of deficiency

2 has been identified, or when some other kind of

3 concern from the Department's perspective has

4 been brought to light.

5 PARTICIPANT: Aaron?

6 MR. LACEY: Yes. So, you know, and I

7 think a lot of the folks in the room already know

8 this, but the Department already has pretty broad

9 authority under existing regulations to require

10 reporting and letter of credit where they see a

11 financial responsibility risk.

12 I mean, I have clients now that I work

13 with that provide the Department on a bimonthly

14 basis with cash flow analyses, pro forma

15 financial statements, by student, by program, by

16 campus enrollments.

17 You know, I think that the amount of

18 reporting and attention to institutions that are

19 potentially distressed, on the part of the

20 institution, on the part of the Department has

21 increased in recent years, which is probably a

22 good thing.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

284

1 But where I'm going with this is, you

2 know, I don't, I don't think that there is a

3 great need at this point to expand or develop in

4 the regulations a series of instances or events

5 or anything along those lines that would specify

6 a reporting, you know, a certain, in other words,

7 I think you've got that authority.

8 And I think that the discretion to

9 exercise that authority, at present, without

10 boxing yourself in with certain regulatory

11 triggers or what have you, is probably

12 preferable.

13 I could understand the Department

14 wanting internally to develop more protocols and

15 think more further about, or think further about

16 exactly what types of situations would warrant

17 further reporting, but I don't think that needs

18 to be in the regulation. If anything, again, I

19 think it boxes the Department in.

20 So, this is to 2. With regard to

21 sureties, you know, I know there was some

22 conversation the 2016 round, and it looked like
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

285

1 in the, in those regulations that were developed

2 about affording institutions alternatives to the

3 traditional letter of credit.

4 I think that's great. I encourage the

5 Department to consider other forms, and that

6 could be cash and escrow, there are insurance

7 products that are being developed. That could be

8 bonds.

9 But I think all of that is good, as

10 long as the Department is getting the security

11 that it needs. But it does give institutions

12 more flexibility to try to provide the Department

13 with the comfort that it needs.

14 I think you have to be really careful

15 about requiring whatever form of surety you might

16 think is necessary prior to, in the example of

17 borrower defense claims, there being actual

18 determinations that the borrower defenses are

19 valid.

20 That it can be, if you go and require

21 some sort of letter of credit or surety in the

22 amount, and this can be, you know, hundreds of
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

286

1 thousands of dollars, depending on the amount of

2 Title IV an institution pulls down, which is

3 typically how it's calculated.

4 That can be an enormous penalty that

5 you're, you know, and burden that you're putting

6 on the institution.

7 And I believe that, prior to, if

8 you've got a bunch of borrower defense claims

9 that have been lodged against the institution,

10 until those are adjudicated and a determination

11 is made, I could understand heightened reporting

12 requirements, because I know you want to

13 appreciate the risk.

14 But I think actually requiring that

15 the, that the institution post that surety would

16 be a penalty being placed upon the institution

17 before anything had actually been determined.

18 PARTICIPANT: And I believe the

19 Department had wanted to respond.

20 PARTICIPANT: Just a very brief

21 response. I want to clarify that we did, in the

22 2016 regulations, kind of leave the door open for
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

287

1 the idea of alternatives to letters of credit.

2 The feeling was that, first of all, we

3 wanted to be flexible in terms of something that

4 was not available at the time might possibly

5 become available later.

6 And as Aaron mentioned, he said he

7 believed that there might be insurance products

8 that were in development or that might be

9 available.

10 Right now, we're not aware of, also,

11 Michael had brought up the issue of bonds. We

12 are not aware, currently, of any bond product

13 available.

14 We met with some people in that

15 industry, and they were interested in what we

16 were looking for, but we're not aware, currently,

17 of anything that exists.

18 So, I think that one of the things

19 we're open to is the idea of, you know,

20 considering alternatives.

21 The idea of having cash reserves, we

22 had talked previously about the idea of offset. 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

288

1 There are things that are possible.

2 But again, there are some things that

3 we might be open to, but we just aren't aware of

4 the product being available. So, keep that in

5 mind.

6 If you have suggestions on things

7 you'd like to see, certainly let us know, and

8 keep that in mind as we go down the path of

9 pursuing language.

10 The other thing I would like to remind

11 everyone, again, is that, and I don't want to

12 repeat too much, but the idea of the

13 Subcommittee, just to please keep in mind and

14 refer to those Issue Papers if you have

15 questions. But their scope is limited to those

16 discussions.

17 So, they would not be revisiting and

18 recalculating the score, looking at those kinds

19 of issues.

20 They are looking at the FASB

21 standards, the Financial Accounting Standard

22 Board, the changes that they've had in their
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

289

1 standards.

2 So, they will be bringing things back

3 to you here for that discussion, so we will have

4 a full discussion of those issues, especially

5 during the second and the third sessions.

6 PARTICIPANT: Okay. Kelli, Michael,

7 Danny.

8 MS. HUDSON PERRY: While not in favor

9 of this concept of the, of the surety, the one

10 thing that I will say and I haven't heard

11 mentioned is the concept of the use of

12 unrestricted endowment as something that a school

13 could possibly put up as collateral.

14 PARTICIPANT: Michael?

15 MR. BOTTRILL: So, while not all,

16 many, maybe even most of the precipitous closures

17 that my agency has experienced have been linked

18 to financial soundness, or you know, more

19 specifically, the lack thereof.

20 And so, I appreciate the Department's,

21 you know, position to try and be able to identify

22 that.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

290

1 But Aaron, to your comments, if the

2 number of claims reach some point that puts the

3 institution ,or potentially puts the institution

4 in such distress that it, that there is a

5 likelihood that it would close, should those,

6 should the institution be found liable, then I

7 think it's reasonable for the Department to have

8 some kind of threshold to, again, limit, or

9 letter of credit or some kind of surety with

10 regard to that.

11 And so, the way that you use

12 percentages, you know, if the, if the number of

13 claims exceeds 10 percent of the Title IV, you

14 know, distributed the previous year, like you do

15 with the letter of credit requirements, that

16 might be a metric that you could, you could look

17 at.

18 You know, some percentage that, if it

19 gets to be so high that there is a, that there is

20 a concern, that should the institution be found

21 liable for those, there is a likelihood of

22 closure, and precipitous closure.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

291

1 PARTICIPANT: Danny and Walter.

2 MR. FLANIGAN, JR.: I like the idea of

3 being able to put cash and reserves or quasi4 endowment up as a surety if the Department so

5 needs one.

6 But I have another question, and I

7 keep coming back to this. The way the Department

8 interprets the financial standards is different

9 from the way the Financial Accounting Boards

10 account for those standards and interpret those

11 standards.

12 Are you trying to move to interpret

13 the standards in the same way of the Financial

14 Accounting Standards Board, or are you going to

15 continue to interpret them differently from the

16 Financial Accounting Standards Board?

17 PARTICIPANT: Based on the work that

18 we've outlined for the Subcommittee, I don't

19 think our plan right now is to revisit any of

20 those other standards.

21 So, I would not look for the way we've

22 characterized issues related to financial
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

292

1 responsibility to change at this time.

2 PARTICIPANT: Okay.

3 PARTICIPANT: Walter?

4 MR. OCHINKO: I just wanted to make a

5 point about endowments. Not all sectors have

6 endowments.

7 So, the other point I wanted to make

8 is that when we were discussing financial

9 responsibility and the triggers during the last

10 negotiations, I think one of the points in favor

11 of the triggers was that they acted as a

12 deterrent.

13 So, it's not just that, you know, you

14 would actually have to have a surety bond or some

15 kind of financial commitment on the part of the

16 institution, but that it would deter bad behavior

17 on the part of institutions, and I think that's

18 an important goal to keep in mind.

19 PARTICIPANT: Any additional, any

20 additional thoughts on Items 1 and 2?

21 PARTICIPANT: Barmak. Barmak.

22 PARTICIPANT: Barmak?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

293

1 MR. NASSIRIAN: I missed part of the

2 conversation, so I apologize if I'm out of order

3 or whatever.

4 But with regard to 668.15, leaving

5 aside the issue of, I don't know why the

6 Department wants to track contingent liability

7 associated with future successful borrower

8 defenses to standards of financial

9 responsibility.

10 I would think the Department's

11 interest is to ensure that all participating

12 institutions are financially sound on the basis

13 of the totality of their circumstances.

14 And I think, you know, intellectually,

15 I think what happened 20 some years ago was that

16 we got so mesmerized with precipitous closures,

17 that if you look at the metrics that are in

18 current regs, they're all focused on liquidity

19 and short-term cash flows.

20 And I think the lesson we may want to

21 take away from the crises of the, of our more

22 recent vintage is that financial soundness
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

294

1 transcends just a current ratio and the absence

2 of prior bad triggers.

3 So, I would suggest what you really

4 may want to look at is something along the lines

5 of what, I think Michael was hinting at.

6 Some ratio analysis that focuses, in

7 the case, but depending on sector, on either

8 adequate capitalization, vis-a-vis loan volume,

9 or available resources in the case of a non10 profit, vis-a-vis the liabilities that are

11 generically created. I think that's one of the

12 problems we have.

13 You can, you can, you can pass the

14 current ratio test through manipulation of

15 resources, and very quickly strip out the

16 operation and become insolvent in three months. 

17 I mean, that's what happened.

18 Corinthian, if my, it was either

19 Corinthian or ITT. I recall very vividly that I

20 could've bought it, like, you know, the equity in

21 my home was less than the market cap, like, two

22 weeks before collapse.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

295

1 And that's one of the problems, I

2 think, with the, with the standards we now have. 

3 I don't know that that has anything to do with

4 borrower defenses. I think that's just a matter

5 of bringing the 668.15 up to date.

6 And then, I think the concerns that my

7 colleagues in the for-profit and the not,

8 nonprofit sectors have raised, that financial

9 accounting standards have changed and the

10 Department has just not caught up with them. I

11 think that's accurate too.

12 PARTICIPANT: Okay. Additional

13 comments from the Working Group on Items 1 and 2? 

14 Okay. And we do understand that it is extremely

15 hot in here. We hope that's not quelling

16 conversation. The thermostat is not set to the

17 current temperature, and we have sent someone out

18 to hopefully address the issue.

19 Do you want to open up Item 3 for us,

20 Annmarie? Or do you have any further questions

21 on 1 and 2?

22 MS. WEISMAN: So, I think we are
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

296

1 interested in hearing a little bit more about

2 Bullet Point one. I think that we didn't quite

3 get as much as we were hoping for there.

4 So, if anybody has additional thoughts

5 on Bullet Point number 1, we would certainly

6 invite you to let us know about that, as well as

7 Bullet Point number 3, which is should the

8 Department take additional steps to protect

9 taxpayer interest? And I'll elaborate there and

10 say, if so, then what, specifically?

11 We're looking for, again, this is,

12 this is really our listening session where we

13 hear from you, what your concerns are, what your

14 reactions are to these papers.

15 So, we're looking for as much detail

16 from you as we can get on these. Again,

17 especially on Item number 3 and 1.

18 PARTICIPANT: As a public institution,

19 I'm fairly insulated from the financial

20 standards, but is this the section under which

21 you would potentially consider those triggers for

22 the letters of credit, or do we not have to talk
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

297

1 about those? Because nobody's really saying --

2 MS. WEISMAN: You can certainly, you

3 can have a discussion about that.

4 PARTICIPANT: And you know, from the

5 school perspective, broadly, I think we should

6 have a conversation about that because what we

7 ended up with was something that was kind of not

8 ideal for access institutions, for one thing.

9 I think, should the Department utilize

10 letters of credit to protect taxpayer interest,

11 that it should be carefully delineated to not

12 capture schools whose mission puts them at risk

13 of meeting the letter of credit just by the very

14 virtue of student that they are serving.

15 PARTICIPANT: Linda, and then Aaron. 

16 Do you want to sit down?

17 MS. RAWLES: No, thank you. Just a

18 suggestion, depending on what other process is in

19 place or what other standards, I think this also,

20 you should have a placeholder for possible

21 defenses, affirmative defenses to liability by

22 institutions.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

298

1 Perhaps there is where we talk about

2 whether they have a robust compliance program. 

3 There was no intentionality or even reckless

4 disregard. They make a good faith effort to

5 have, you know, information out for students.

6 I don't know what all of them would

7 be. It would be a nice discussion to have, but I

8 think that we should consider affirmative

9 defenses to liability.

10 MR. LACEY: Yes, I mean, I, speaking

11 to the triggers, I think the idea of listing a

12 list of events and tying those automatically to

13 the posting of some sort of surety or in the

14 final rule that came out in '16, you know, to

15 some sort of automatic and interesting

16 recalculation of the composite score, which we

17 seem to all agree needs work, I think is a bad

18 idea.

19 I just think it's very problematic and

20 it hems in the Department, in a sense, because it

21 forces automatic behaviors.

22 But I think, you know, it seems like
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

299

1 the real concern here is, and the real fear,

2 given past events, is that you could have a

3 situation where you've got a school that's in

4 serious financial stress, or there's a problem

5 and the Department wouldn't know.

6 You know, the point I made earlier, I

7 will reiterate, even though I'm not supposed to,

8 and that is the Department has the total power

9 and authority to do that now. I mean, it has,

10 and it is doing it now.

11 I think if you wanted to develop, I

12 would say, not in the regulations, but in the

13 sub-regulatory guidance, but even in the regs, a

14 list of events that, if they occur, they have to

15 be reported to the Department. I mean, that

16 makes sense.

17 And then, the Department is

18 formalizing and saying, if anything, if these

19 things occur, we want to know.

20 But I wouldn't tie them to an

21 automatic outcome, understanding that the

22 Department has the authority, under financial
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

300

1 responsibility, that if it sees something that

2 gives it concern about the institution's

3 solvency, and by the way, it doesn't even have to

4 go through the composite score.

5 I mean, today, if the Department

6 thinks an institution's in risk of closure

7 because their accreditor is taking an action, for

8 example, or something along those lines, they can

9 put them on HCM1. They can go ahead and proceed

10 to a surety.

11 So, these tools are in the tool bag,

12 and I would, I would encourage that the

13 Department resist putting together a bunch of

14 automatic triggers, or boxing itself in. I think

15 it has that authority already.

16 PARTICIPANT: Lodriguez?

17 MR. MURRAY: Just to give this

18 thought, injected, speaking of the automatic

19 triggers, I want to speak from the perspective of

20 the minority-serving institutions, specifically

21 private colleges and universities, and even more

22 specifically, private historically black colleges
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

301

1 and universities.

2 Having to pledge those letters of

3 credit based on those triggering events may not

4 even relate to the financial condition of the

5 institution.

6 And we believe that having the

7 triggering events, they're already building upon

8 even more flawed standards previously existing at

9 the Department.

10 We believe that because of the status

11 of the students that we have, oftentimes first

12 generation college students, et cetera, that

13 private historically black colleges and

14 universities can be in a more precarious

15 financial position.

16 And having to have these letters of

17 credit come up can put the schools in a position

18 where they are having problems with investors. 

19 They're having problems with their Board. 

20 They're having problems moving forward, and it

21 has unintended consequences on institutions

22 simply because they have to put forth those
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

302

1 letters of credit.

2 We think that is, and when you talk

3 about the triggers, that's just something that

4 we, as a subgroup of the MSIs, just really have

5 to make sure that everyone understands that it's

6 very problematic for us.

7 It may not be problematic for other

8 institutions, but private historically black

9 colleges and universities foresee this being a

10 huge issue for us moving forward if it stays in

11 any way, shape, form, or fashion near the

12 regulation.

13 PARTICIPANT: Walter, then Michael.

14 MR. OCHINKO: Sure. I don't really

15 know or understand the history of this, but I

16 just wanted to point out, just because the

17 Department of Education already has these

18 financial standards and can, you know, require

19 surety bonds doesn't mean that they always do. 

20 And I would just point out in the case of

21 Corinthian, there was no surety bond.

22 So, the Department is on the hook for
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

303

1 all of the money that has to be refunded under

2 defense to repayment.

3 PARTICIPANT: Okay. You're still,

4 your name's still technically up.

5 MR. BOTTRILL: Technically.

6 PARTICIPANT: Okay, thanks.

7 MR. BOTTRILL: I mean, we may have the

8 cart a little bit in front of the horse here

9 because, I think, again, there's, we might

10 actually have consensus that the financial, you 

11 know, composite score needs some work. I won't

12 ask for a temperature check. I think it's warm

13 enough in here as it is.

14 (Laughter)

15 MR. BOTTRILL: So, you know, having

16 said that, and not wanting to harm institutions

17 that are falling below the 1.5 composite score

18 because of other considerations or an inability

19 to meet some of the ways to manage that

20 appropriately.

21 I would still look for ways that, when

22 an institution has reached a level of financial
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

304

1 distress, HCM2 and reimbursement is one way of

2 limiting access, but it's still full access.

3 And what I'm suggesting is a different

4 approach of, again, a graded approach to access

5 to full eligibility, not dissimilar to the way

6 that it's used when you trip the measures for

7 default rates and you go, you know, 40 percent,

8 and then you can only be Pell eligible and you

9 can't be eligible for a loan.

10 Maybe there's another way to limit

11 access to it to put more taxpayer dollars on the

12 hook, and more student debt when the situation is

13 dire enough that we, that the Department has

14 concerns that that money is not being well15 distributed.

16 PARTICIPANT: Kelli, Valerie, then

17 Robert.

18 MS. HUDSON PERRY: I'm afraid to talk

19 into it.

20 (Laughter)

21 MS. HUDSON PERRY: Just because I've

22 heard some echoes around the table of the fact
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

305

1 that the current responsibility ratios need some

2 work, I know that we've tasked the, or you've

3 tasked, the Department has tasked the

4 Subcommittee with looking at new financial

5 accounting standards, specifically one for

6 financial reporting and one on leases, which I

7 think in potentially looking at the changes to

8 the financial reporting one will address some of

9 the others.

10 But there are FASB changes that have

11 occurred over the last 20 years that also have

12 not been addressed.

13 So, I would like to ask the Department

14 that when the Subcommittee does start to talk

15 about these, if there's not a way to address

16 those changes as well within one of these Issue

17 Papers, that they be allowed to look at those

18 FASB changes as well, as they specifically relate

19 to that calculation.

20 PARTICIPANT: Valerie, and then

21 Robert.

22 MS. SHARP: As I listen to everyone
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

306

1 discussing the issues today, I think we all can

2 agree on a point, and then we get stuck and the

3 next point. And so, maybe I don't have a

4 solution.

5 I'm asking maybe if the Committee

6 could start to brainstorm solutions. And I've

7 heard a few ideas around the table, but I think

8 that all of the table can agree that those bad

9 apples who have a blatant disregard for students

10 and the taxpayers and everybody involved, have

11 and should have some liability for that blatant

12 disregard of everyone around the table.

13 But where it becomes tricky is in

14 trying to set some type of liability for those

15 institutions who have had a blatant disregard for

16 the rules and for students, and even the

17 government money that is involved.

18 That, now, we are capturing within

19 that net, institutions who were maybe, did make

20 an innocent mistake, but still harmed a student,

21 or you know, those types of things.

22 So, how do we protect a taxpayer and
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

307

1 the students who have had a, have committed

2 grievous fraud, but also provide some type of

3 different standard or, I don't know what the

4 process is.

5 As I'm sitting listening, I'm

6 thinking, we have to have something to protect

7 the taxpayers from maybe a Corinthian and the

8 millions that are involved there.

9 But the other claims that may put a

10 small school at tremendous risk, or those who are

11 serving students who are minorities or first

12 generation, we don't want them to lose their

13 access.

14 We do not want those schools to have

15 a purpose to be forced to close because of

16 financial pressures over a small amount of claims

17 that weren't fraudulent on purpose, that just

18 happened.

19 So, how do we, is there any way even

20 to differentiate that in our discussions and in

21 the regulations that we put in place, because we

22 are talking about two very different types of
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

308

1 issues, and we don't want to cause undue stress

2 to small institutions who are serving a public

3 that maybe everyone else isn't and forcing them

4 out of the market that desperately needs them. 

5 But we do want to hold accountable those who are

6 committing fraud against our students.

7 PARTICIPANT: And I, and I think, just

8 from the facilitator's perspective, that is the

9 question that we're here to, here to answer, and

10 hopefully the Working Group can provide those

11 methods of distinction, or at least suggestions

12 for it.

13 MS. SHARP: Just say, I think one

14 thing is, you know, we just talk in generalities. 

15 I'd like to see us kind of parse that out a

16 little bit more is maybe why I made the

17 statement.

18 PARTICIPANT: Robert.

19 PARTICIPANT: Thank you. I have the

20 answer. No.

21 (Laughter)

22 PARTICIPANT: Echoing a little of what
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

309

1 I've heard, but putting, I guess, a little bit of

2 a twist on it, maybe from a state perspective and

3 my vantage point and working in state systems,

4 and now for a national organization representing

5 states.

6 It's no mystery here, and it's not an

7 unknown fact, that we have had persistent equity

8 gaps for years and years in our nation.

9 Our first generation low income

10 minority underserved populations do not succeed

11 and are not accepted as high of rates,

12 particularly success-wise, even when they have

13 better economic, I mean academic qualifications

14 when they enter college.

15 There are these persistent gaps that

16 we have to address, and I think this ties in in

17 meaningful ways in this conversation that we're

18 having today.

19 Most of these students end up in lower

20 resourced institutions that don't have as much

21 bandwidth, and they struggle more anyway.

22 And we're starting within the academic
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

310

1 side of the house to see some paths forward that

2 seem to be getting traction around intrusive

3 advising, degree maps, the way we're changing

4 developmental education.

5 And some of these different issues,

6 and the difference we're making here, tie in

7 directly to taxpayer interests and making sure

8 that we're not ignoring this population and we're

9 getting them through the educational pipeline.

10 Dan mentioned yesterday, the triad

11 that exists, this whole idea of the federal

12 interest for the taxpayers, and you have the

13 regional and specific accreditors that exist, and

14 then the state systems and interests.

15 And frankly, we have to have better

16 communication and better dialogue on a regular

17 basis between these three entities if we're going

18 to develop any type of system or approach that

19 works for all of us.

20 That's how we're going to protect

21 these students who need it the most. These

22 institutions can't face situations to where they
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

311

1 no longer exist because of some of these

2 financial pressures and strains that exist, but

3 have to be held also to adequate approaches and

4 what we know to be best practices.

5 So, furthering these conversations is

6 a part of this, the ability to protect taxpayer

7 investment due to best practices that are taking

8 place, I think, should be a part of any solution

9 that we discuss here.

10 PARTICIPANT: Okay. And looking

11 forward, both a Questions 1 and Questions 3,

12 specifically with Question 1, can the Working

13 Group identify any specific conditions the

14 Department should be considering as they look

15 towards language in the future?

16 Or with Question 3, steps or criterion

17 that would facilitate or necessitate an

18 additional layer of protection for the taxpayer? 

19 Alyssa?

20 MS. DOBSON: I just, I think we're

21 having trouble identifying them because very

22 different schools can have the same looking
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

312

1 criteria.

2 And so, I think Aaron probably said it

3 best when, instead of the Department trying to

4 find definitive benchmarks, you know, using their

5 own authority, if it, if it sounds like a duck,

6 walks like a duck, that kind of thing, and that

7 would avoid encapsulating the institutions who

8 may look but aren't actually the bad actors in

9 the game.

10 And so, I think the reason why we're

11 having a hard time coming up with those criteria

12 is because they just don't exist.

13 PARTICIPANT: We have to get better,

14 overall, as a nation too, in measuring what

15 actually is taking place in higher education,

16 what is being learned.

17 Aaron commented earlier about widgets

18 and, you know, we can look at credits, and we can

19 look at these degrees and this credentialing,

20 what learning is actually taking place?

21 For some of our institutions that

22 accept students maybe with lower academic
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

313

1 standards coming in, perhaps they're quite value

2 additive in what they provide, and we have to get

3 better at measuring learning, and I think this

4 could tie in with a lot of this as far as

5 taxpayer's interests and examining what actually

6 happens within that often black box of higher

7 education. So, I hope this is something we could

8 consider moving forward as well, value additive.

9 PARTICIPANT: Kelli.

10 MS. HUDSON PERRY: One of the other

11 reasons that I think it's difficult to, in

12 speaking with, you know, should the Department

13 take additional steps to protect the taxpayers, I

14 think it goes back to the concept of, how do you

15 identify the bad actors? Right?

16 So, without knowing who the bad actors

17 are around the table and, you know, why types of

18 claims are coming for discharge and reasons why,

19 are there, are there rules or are there, you

20 know, mechanisms on the forefront to put in place

21 so that those bad actors can't do what they're

22 doing?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

314

1 So, I don't, I don't know if we have

2 enough information to actually give a great, at

3 least I don't think I have, to be able to give a

4 great recommendation, because I don't know who

5 they are and I don't know what rules they're not

6 following or what rules you could potentially put

7 in place so that they don't become bad actors.

8 PARTICIPANT: Wanda, and then Abby,

9 and then back to the Department. But I would ask

10 that if you're going to offer something, please

11 offer something specific and concrete. We do

12 need to move on.

13 MS. HALL: This is pretty concrete,

14 and it's a dirty word, but we did talk about this

15 last time a little bit.

16 You know, additional steps to protect

17 taxpayers, I mean, there are program reviews and

18 audits that are performed.

19 And when you're performing a program

20 review, there's things that you look at, and

21 maybe that needs to be increased a little bit. I

22 mean, as I said, it's a dirty word.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

315

1 We see it, you know, we have program

2 reviews as well. We have SSAE 18s. We've had

3 stations, and all of that stuff looks at, you

4 know, our administration of the program, our

5 capabilities from a servicer's side, for sure.

6 PARTICIPANT: Abby, then Karen.

7 MS. SHAFROTH: So, I'll try to speak

8 to point. Bullet 1 and Bullet 3, on Bullet 1,

9 under what conditions and to what extent should

10 institutions incur liability for reimbursement of

11 borrower defense claims, Linda asked me to make

12 the point again when we got to this issue that

13 there should be a, that I believe there should be

14 a separation of determination of liability, or a

15 determination of relief for the student and

16 determination of liability for the school. So, I

17 am. I still, sorry --

18 PARTICIPANT: That's okay.

19 MS. SHAFROTH: Oh, okay.

20 PARTICIPANT: Go ahead.

21 MS. SHAFROTH: No, I don't want to

22 mischaracterize you. So, I would just say that,
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

316

1 you know, the Department could create some

2 conditions under which it determines that it

3 makes sense to seek recoupment from the school

4 after a student is, has their student loans

5 forgiven through the borrower defense process.

6 And it may be that, you know, it

7 doesn't make sense to go through that process if

8 there's just one individual borrower defense

9 claim that has been approved for that school,

10 that it's not worth the Department's time and

11 that it's not a good use of taxpayer resources to

12 seek recoupment from the school in that instance,

13 but that if there is a, you know, evidence of

14 widespread misconduct where there are, you know,

15 a large number of successful borrower defense

16 claims relating to the same institution, then it

17 does make sense.

18 Or if there's evidence from a state

19 attorney general's investigation of that sort of

20 misconduct, then maybe it does make sense in

21 those circumstances. So, those are just a few, a

22 few possible ways to approach Bullet Point 1.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

317

1 In terms of Bullet Point 3, and should

2 the Department take additional steps to protect

3 taxpayer interests, I was going to make a similar

4 point to Wanda, just that the Department has an

5 enforcement unit.

6 Being really proactive and

7 investigating misconduct at, or allegations of

8 misconduct, or other evidence of misconduct of

9 institutions, to try to deter and stop that

10 misconduct before it impacts more borrowers and

11 sets up more potential claims for borrower

12 defense relief. It seems like a really important

13 piece of protecting the taxpayers and protecting

14 student borrowers.

15 PARTICIPANT: Okay. And as usual,

16 Colleen, kind of the end of the discussion has

17 gotten some more, some more tags up, so we will

18 go through them. Karen, Walter, Jaye, and then

19 back to the Department.

20 MS. PETERSON SOLINSKI: So, I'm really

21 speaking to the third bullet, and which is, how

22 do you protect taxpayer interests for the future. 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

318

1 And yes, it's a little bit of a

2 crystal ball exercise to try to figure out which

3 institutions in the future might give rise to

4 borrowers defense claims.

5 I can tell you, it's not financial

6 ratios. Why? Because we have about five

7 institutions go, unfortunately, over the edge

8 every year, often with very low composite

9 financial ratios. What are they? They're small

10 religious institutions, minority serving

11 institutions.

12 It's unlikely, I think, that they're

13 going to give rise to borrowers defense claims. 

14 I would be surprised if they did. They're

15 financially risky, but they're not at risk of

16 misrepresentation or fraud. That's a different

17 kind of issue.

18 And so, I think we have to look at the

19 ones that have gone through this already, like a

20 Corinthian, like an ITT.

21 I know about one of those cases, and

22 I know that they were indicia, Barmak is right. 
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

319

1 They were indicia that we might have seen, and

2 hindsight's 20/20, right?

3 But there were indicia that we might

4 have seen, had we all been looking more

5 carefully, not only at the kind of things you're

6 talking about, market cap, but also a program

7 reviews and all of that data.

8 And so, I think, before we task a lot

9 of small institutions with higher letters of

10 credit when they're not really the risky ones

11 we're trying to get at, we ought to be looking at

12 our history here.

13 What could we have done differently in

14 the cases that we did have? What were the things

15 we should have seen and flagged?

16 I know some of them because I know a

17 little bit about those cases. I won't say them

18 here, but I know some of those indicia that we

19 could have seen, and where we might have imposed

20 some kind of letter of credit or other kind of

21 surety that would have protected taxpayers for

22 the future.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

320

1 PARTICIPANT: Walter. Walter.

2 MR. OCHINKO: Yes. I agree with the

3 comments that Karen made. And I just want to

4 point out, I don't remember all of the triggers

5 that were in the borrower defense rule that was

6 promulgated in November last year, but I do

7 remember two of them, and I think they really go

8 directly to this whole issue of, how do we

9 identify bad actors?

10 One of them, I think, is one that my

11 colleague mentioned, and that is, you know,

12 either lawsuits, investigations, or settlements. 

13 Particularly settlements.

14 I mean, I distributed a list this

15 morning. A lot of these schools are still, you

16 know, participating in Title IV, and they have

17 settled with the Department of Education.

18 I think another trigger that was

19 identified was, you know, exceeding the 90

20 percent ratio.

21 There's a cap on the amount of Title

22 IV revenue that a school can get from the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

321

1 Department of Education. And schools that exceed

2 that, I think, were, would have set off one of

3 the triggers. And I'm sure there are others. I

4 just don't remember what the other triggers were.

5 PARTICIPANT: Okay. Linda, and then

6 back to the Department to wrap it up.

7 MS. RAWLES: If we're going to look at

8 settlements, we have to look at incentives. 

9 Again, you know, many people do settle lawsuits

10 for lots of reasons other than culpability.

11 And if you do look at settlements,

12 you're going to have an incentive not to settle

13 and we're all going to be in a lot more

14 litigation. So, I think you have to be careful

15 with that. That's all I wanted to say.

16 PARTICIPANT: Okay. Noting that we do

17 have some administrative matters to kind of take

18 care of at the end of the day here, I want to

19 turn it back to the, to the Department, just to

20 kind of finalize Issue 3.

21 Are there any points, obviously,

22 specific suggestions or proposals are accepted
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

322

1 and encouraged, that the Department would like

2 the Working Group to consider this evening, you

3 know, as some homework, before we go onto Issue 4

4 tomorrow morning?

5 PARTICIPANT: I think that we probably

6 have what you have in mind right now, but if you

7 do think of other things, I'd be certainly happy

8 to reopen this discussion in the morning if there

9 are further areas that you think about overnight. 

10 I know this is probably all you want

11 to think about all day and all night, but

12 seriously, if things do come up, if you think of

13 some specific issues that you feel you didn't get

14 a chance to raise today, I'd be happy to circle

15 back on this one tomorrow morning.

16 I think that, while it may appear that

17 we have not paced the conversations as well as we

18 could, in looking at the issues, we do feel that

19 Issues 1 through 3 were the ones that would take

20 the most amount of time and the most significant

21 discussion.

22 Not to minimize the other issues, but
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

323

1 I think that the point was made earlier that, you

2 know, by getting through this paper today, we're

3 getting through about half of the issues.

4 So, I think that we are on track, and

5 I appreciate the contributions that you've made. 

6 I appreciate the thought and the significant

7 effort that you've made to cover the territory

8 that we've covered already, and look forward to

9 doing more of that tomorrow.

10 That said, I do know that we have some

11 other administrative issues, some kind of

12 housekeeping issues as well, and I want to make

13 sure that we have time to devote to that, as well

14 as public comments. So, I'll hold any other

15 further comments until tomorrow.

16 PARTICIPANT: Okay. I believe,

17 yesterday, I believe, yes, that was yesterday,

18 Ashley Harrington had raised the question of

19 making a petition for a member for the

20 Subcommittee.

21 She touched base with me today just to

22 make sure we could make time for that. So, we
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

324

1 will open the floor to you, Ashley.

2 MS. HARRINGTON: Thank you. So, I

3 actually have two individuals that I would like

4 the Committee to consider adding to the Financial

5 Responsibility Subcommittee. Two experts that I

6 think could really add to that conversation.

7 Representing constituencies that I don't

8 think are represented or are not represented

9 currently, which is in this list, minority10 serving institutions and consumers and students. 

11 So, I have two people, and I'll let them

12 speak for themselves. Dr. Julianne Malveaux and

13 Blake Harden.

14 They are both here, and they'll

15 introduce themselves, and then I hope that the

16 Committee will seat them on this Subcommittee. 

17 Thanks.

18 PARTICIPANT: Yes. And just a note on

19 process, so we can have both individuals come up,

20 provide us an introduction, some background, why

21 they want to be on the Committee, and then the

22 Working Group can ask questions, and we'll take a
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

325

1 consensus vote. Michael, question before?

2 MR. BOTTRILL: I have a quick question. 

3 In determining who or the types of groups that

4 are going to be represented on that Committee, is

5 there a specific reason why that these particular

6 areas were left off, or is there more discussion

7 around the fact that, it's my understanding that

8 this Committee is really just to discuss changes

9 in accounting principles and rules and how they

10 affect the current composite scores and come up

11 with recommendations for future.

12 So, therefore, it's really, it's not

13 that they're creating new policy, they're just

14 simply providing context for changes in FASB. Is

15 that correct? Is my assumption correct there?

16 PARTICIPANT: Your assumption is

17 correct. The goal of the Subcommittee is to make

18 recommendations to this Committee.

19 So, anything that they discuss is really

20 just to conserve the time of this Committee to

21 take issues that we thought were very specific to

22 one industry where we needed to ensure that we
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

326

1 had the people with the expertise to discuss

2 those issues.

3 Generally speaking, we would expect the

4 members of the Subcommittee to have an accounting

5 background or something very related to that. 

6 So, we were interested in keeping the Work Group

7 fairly small.

8 Again, we did not dedicate significant

9 resources to that because it wasn't something

10 that we initially set out to do. It was

11 something that kind of grew out of the

12 conversation.

13 When people heard that financial

14 responsibility was going to be discussed, it's,

15 oh, let's take an opportunity here.

16 We cannot revisit the entire composite

17 score and how that's calculated. That would be a

18 significant effort, and that would need its own

19 process. That would have its own rulemaking

20 session apart from this one.

21 We felt that those issues were far too

22 significant, would take far more time than we had
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

327

1 to devote within this Committee.

2 So, we gathered a set of individuals

3 that we thought met what we thought was

4 reasonable, in terms of getting together a small

5 Working Group.

6 But again, knowing that they were only

7 set out to making recommendations and that all of

8 that full discussion then about those

9 recommendations would occur here in this

10 Committee in Sessions 2 and 3.

11 So, also, to clarify, the Subcommittee

12 is going to meet this Thursday and Friday, and

13 then, they will meet prior to our second session

14 that we have here with the full Committee.

15 So, they'll have two opportunities to

16 meet for a couple of days each before we come

17 back together again.

18 And hopefully, they'll have some initial

19 thoughts for us then to be able to share with us,

20 but that we could then have the full discussion

21 at that time as well.

22 PARTICIPANT: Kelli.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

328

1 MS. HUDSON PERRY: Just quickly, when

2 the two individuals introduce themselves, I'd

3 just like to ask that they provide their

4 credentials as it relates to understanding the

5 accounting literature as it exists.

6 PARTICIPANT: Do we have the

7 individuals? If, I guess, one of the individuals

8 wants to come up first, and then we'll have the

9 second individual come up.

10 DR. MALVEAUX. Well, good afternoon. 

11 I'm Dr. Julianne Malveaux. I am President

12 Emerita of Bennett College for Women. It is the

13 oldest historically black college or university

14 that serves women.

15 People know Spelman a little bit better,

16 but we are older and have an equally

17 distinguished history.

18 I was president from 2007 to 2012. And

19 I'm especially concerned about how the rules will

20 impact historically black colleges and other

21 minority-serving institutions.

22 My background is that I have a Doctorate
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

329

1 in Economics from MIT. I do not have an

2 accounting degree, and I don't want one.

3 But I think that the background that I

4 have makes it possible for me to be a contributor

5 to the conversation. It is something that I am

6 deeply concerned about.

7 I would note that I did apply earlier

8 for the full Committee and was not accepted, but

9 I remain very interested in these issues and I'm

10 happy to take any of your questions.

11 PARTICIPANT: So, just because the, I'm,

12 so the Subcommittee is designed to be a Working

13 Group to talk about the, specifically, the

14 changes in the ASU.

15 So, if you're not an accountant and you

16 don't necessarily understand those, what, can you

17 explain a little bit more as far as what

18 contribution you feel you would make?

19 DR. MALVEAUX: The fact that I'm not an

20 accountant doesn't mean that I don't understand. 

21 I think that's a little bit presumptuous, with

22 all due respect.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

330

1 Essentially, having worked in and

2 administered, having had financial aid people and

3 other lending people report to me, I do think

4 that I can look at these issues and bring

5 something to the table.

6 Just in listening for the past few

7 minutes as I heard people talk about some of the

8 loan issues and which institutions are the

9 Corinthians, as opposed to which are the, let's

10 say, Morris Brown College.

11 And a very big difference in those kinds

12 of colleges and the kind of challenges that they

13 face. I think that that's the kind of texture

14 and context that I would bring to the

15 conversation.

16 PARTICIPANT: Thank you for your

17 information there, and your background is

18 extremely impressive.

19 So, thanks for volunteering for the

20 position, but I think the concern here, and

21 again, please correct me if I'm wrong here, is

22 this specific Subcommittee is specifically
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

331

1 looking at changes in accounting structure.

2 And I'm assuming that most of the

3 people, and again, I haven't taken a look in

4 detail, but I'm assuming that most of the people

5 on that Committee are either accountants or CPAs,

6 and have a significant understanding of those

7 particular principles and how they're going to be

8 applied. And that's where it ends, as far as I

9 know.

10 And then, that, just that simple data,

11 right, data is brought to the group, to be able

12 to look at and interpret. Is that correct?

13 PARTICIPANT: Yes, I can definitely say

14 that is correct. And I think that, again, we do

15 not have a representative from each of the

16 constituencies that we have here, but the thought

17 is that the Subcommittee, again, is reporting

18 back to this full Committee.

19 So, because this is the decision making

20 body, all parties are being considered, and all

21 constituencies does have a voice because the body

22 that is the Subcommittee is only making
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

332

1 recommendations to this full Committee.

2 PARTICIPANT: Joseline?

3 MS. GARCIA: I don't have a question to

4 you, per se, but more so to the group. Who here

5 has a master's in public policy? Like, raise

6 your hand if you do.

7 Okay, no one, but we're talking about

8 policy. So, I don't think that folks who want to

9 be in the Subcommittee need to be accountants to

10 be a part of that conversation because those of

11 us who are on this Committee, we obviously don't

12 have a master's in public policy.

13 PARTICIPANT: Ashley, and then Danny.

14 MS. HARRINGTON: So, first I would like

15 to say, I think Dr. Malveaux is communicating

16 that she is very familiar with these standards,

17 having ran a college for five years, having all

18 of these kind of parts report to her, having

19 dealt with all number of reports and standards,

20 she is very familiar and can contribute to all of

21 these things, and is able to do so and willing to

22 do so.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

333

1 But I think the other thing is, though

2 all of the recommendations have to come back to

3 this Committee, I think we've been talking about

4 this since yesterday.

5 Transparency is extremely important in

6 this process, and because this Subcommittee,

7 we've already said, is not going to be public,

8 and all of the voices cannot be represented.

9 And yes, every Committee member can go

10 to those, can go to those meetings. I,

11 personally, as the consumer advocate

12 representative, don't have time to go to all of

13 those meetings, and will not be able to.

14 And I'm sure there are other people at

15 this table who will not be able to go to all of

16 those meetings.

17 And so, I think having as many voices at

18 that table that represent the constituencies that

19 are, that have a stake in these issues, is

20 important.

21 And even if they are just making

22 recommendations, the people have to be at the
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

334

1 table to create the correct recommendations, and

2 to create a full set of recommendations.

3 PARTICIPANT: Okay. Danny, Will, Linda,

4 and then I want to get to our other, our other

5 candidate, just to, just to continue moving

6 things along as the facilitator, so we can ask

7 questions for the other candidate, and then reach

8 a decision as a Working Group.

9 And then, we can go onto the other

10 agenda items that we have for the rest of the

11 day, administrative things, and still have time

12 for Working Group, or public comment.

13 MR. FLANIGAN, JR.: Okay, good. Can you

14 hear me? I am the vice president of a very small

15 college called Spelman College, and I've been the

16 vice president and treasurer for probably 15 to

17 20 years.

18 I've had a chance to work with the good

19 doctor. She's up a Bennett College, which is one

20 of our competitors, and I will tell you, when we

21 have a had a chance to converse and to have

22 conversations about finances and accounting and
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

335

1 ratios and other stuff, she may not be an

2 accountant, but she's very conversing in the

3 conversation.

4 And so, I think she would bring value to

5 the Committee. I think, she's not an accountant,

6 but I think her words and her wisdom would be

7 welcome. Thank you.

8 DR. MALVEAUX: Thank you. And we're not

9 competitors. We're sister schools.

10 MR. FLANIGAN, JR.: Yes.

11 (Laughter)

12 MR. BANTLE: Will, but can you turn your

13 mic off?

14 MR. HUBBARD: I'll keep it brief. The

15 question I would propose to the audience is, and

16 to the Committee, really, is what risk is there

17 in including a mind who accomplished an economics

18 degree from MIT? What risk?

19 MR. CARUSO: Okay. Thank you for all

20 the questions. Thank you, oh, Linda, sorry.

21 MS. RAWLES: This is a bit of an awkward

22 situation because I mean no disrespect to your
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

336

1 credentials at all. I'm sure you're everything

2 that you say.

3 But all the constituencies here could

4 bring up equally qualified people. Unless there

5 is, you know, an additional add to the Committee,

6 if one constituency is adding another person to

7 the Committee, I ask that we all have an

8 opportunity to bring people up and add someone to

9 the Committee.

10 MS. HARRINGTON: And I would say, under

11 the protocols, every member of the Committee does

12 have that opportunity to bring forth an expert

13 and have them voted on by the Committee, and I

14 would be happy to, as speaking for myself,

15 consider your expert.

16 MS. HARRINGTON: I believe in the

17 protocols, it said they could be brought in for

18 the financial, for Financial Responsibility

19 Subcommittee, and within the Federal Register

20 notice that they could be brought in. It didn't

21 say when they had to be brought in and at what

22 point. So --
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

337

1 MR. BANTLE: Just a facilitator's note,

2 this was a conversation that I do recall from

3 tomorrow, or from yesterday. Not tomorrow.

4 (Laughter)

5 MR. BANTLE: It's been a long day. From

6 yesterday, and we did keep the option open for

7 this Financial Responsibility Subcommittee, you

8 know, for these two days before the Committee

9 does start. So, by the discussion yesterday,

10 that would be open tomorrow as well.

11 MS. RAWLES: I think, maybe I should've

12 been a little clearer. My point is that, unless

13 there is a specific value add to the expertise

14 that the Committee is considering, this is going

15 to open up a door that I don't think we're all

16 going to want to go down because it's going to

17 force other constituencies to do the same thing,

18 and I think we're going to get off track.

19 MR. BANTLE: Okay. I want to, Michael.

20 MR. BOTTRILL: Just in conclusion to

21 this, for me, you know, it is a bit of an awkward

22 situation because, again, I'm sure your
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

338

1 credentials are fantastic. I'm not, I'm actually

2 positive they're fantastic, and congratulations

3 on those. And I'm sure there is a great value

4 add that you could bring.

5 And to your point, Will, there is, there

6 is no particular risk, to say, to add to another

7 person.

8 But what I find is it's just breaking

9 protocol, for the most part, in terms of the fact

10 that a Subcommittee has been created.

11 If, and there's an implication, it

12 seems, that you don't feel there's enough

13 representation from your particular constituency

14 within that Subcommittee.

15 So, again, I'm struggling with why

16 that's felt, and why do we all feel that there

17 has to be, in a Subcommittee talking about some

18 financial implications in terms of changes in

19 FASB, why is it that we all feel we have to have

20 some form of a voice there to have transparency?

21 And that's the part that I'm struggling

22 with, that your comment was about lack of
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

339

1 transparency if you don't have your own

2 representative on a Subcommittee talking about

3 changes in accounting principles.

4 MR. BANTLE: Okay.

5 MS. HARRINGTON: My point was about --

6 MR. BANTLE: Just --

7 MS. HARRINGTON: -- transparency in

8 general, and the fact that we voted to not have

9 that Committee be, in and of itself, public,

10 Subcommittee, in and of itself, public.

11 This is something that was noticed and

12 commented and nominations were requested. And I

13 would also like to point out that your

14 constituency group does have representation on

15 the Financial Responsibility Subcommittee.

16 MR. BANTLE: Okay. I understand there

17 are still some name tags up. We do have a lot to

18 get through for the rest of the day.

19 Dr. Malveaux, I want to thank you for

20 introducing yourself. We'll go onto the next

21 candidate, and then we can, we will, we will get

22 to a consensus check from the group.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

340

1 DR. MALVEAUX: Okay. Thank you very

2 much for your consideration.

3 MR. HARDEN: Hi, my name is Blake

4 Harden. I'm admittedly less distinguished than

5 Dr. Malveaux.

6 (Laughter)

7 MR. HARDEN: But I formally served as a

8 policy advisor with the Department for just under

9 five years, and I was working on institutional

10 accountability and other oversight issues,

11 largely representing the issues of consumers and

12 taxpayers.

13 I've done a number of projects related

14 to the financial composite score and other

15 related regulations in the scope of financial

16 responsibility, the financial responsibility rule

17 and administrative capability.

18 More recently, I have been engaged in a

19 research project to understand the history of

20 financial responsibility rules and the particular

21 impact of all of the ASUs in the last two decades

22 on that rulemaking, the present rulemaking.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

341

1 As far as my financial background, apart

2 from the work that I did at the Department, and

3 working with a number of financial experts there,

4 I have a financial background participating in

5 the management of two businesses, and I also a

6 degree from the University of Pennsylvania, and

7 took courses in the insurance and risk management

8 division of that school.

9 MR. BANTLE: Okay. I would like to open

10 it up to the Working Group for questions.

11 PARTICIPANT: My question is very

12 simple, regard value add, would you say that you

13 have both experience in the public and private

14 sectors that pertains to the direct topics of the

15 Committee, the Subcommittee?

16 MR. HARDEN: Yes, I do. On the topic of

17 private businesses, I haven't been involved in

18 private for-profit education or the institution

19 side, but I have worked inside a for-profit

20 business, which is also subject to FASB

21 standards.

22 MR. BANTLE: Aaron?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

342

1 MR. LACEY: What do you think about the

2 composite scores?

3 (Laughter)

4 MR. HARDEN: Well, I mean, I think it's

5 very clear that the composite score needs to be

6 updated to reflect the new FASB updates.

7 I think it's hard to say without

8 additional analysis about, you know, changes to

9 the weightings and the ratios that were

10 ultimately chosen in the '97 regulations. I

11 think that ultimately is outside the scope of the

12 Subcommittee.

13 But you know, the financial composite

14 score's served its purpose, at least for a number

15 of schools over the past two decades, albeit, you

16 know, there have been failures, most notably, one

17 a few years ago.

18 PARTICIPANT: Since we asked our other

19 candidate, we'd like to ask you also your

20 background. You said you had a degree from

21 University of Pennsylvania, but could you tell us

22 the subject matter of that degree?
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

343

1 MR. HARDEN: Yes, I studied political

2 science with a focus on public policy. I

3 completed two, or was awarded two fellowships

4 while I was at Penn, also related to public

5 policy and analyzing the administration of the

6 University itself.

7 MR. MURRAY: You mentioned you were at

8 the Department for five years. Which five years

9 were you at the Department?

10 MR. HARDEN: That was the past five

11 years prior to January 2017.

12 MR. BANTLE: Okay. Any additional

13 questions? Okay. Thank you very much, and I

14 thank the Committee for their questions.

15 At this point, per the protocols, we

16 have to do a show of thumbs, and for Subcommittee

17 members to be added, it has to be by a consensus

18 of the Working Group. Aaron, did you have a

19 comment?

20 MR. LACEY: Well, I guess my question

21 is, do we want to make a determination on these

22 individuals before we've heard folks who might be
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

344

1 presented by other individuals?

2 I mean, I don't have anyone to present,

3 but I don't know if other folks do have someone

4 to present.

5 Wouldn't it make sense to be making a

6 decision on the composition of the Subcommittee

7 all at once, as opposed to making a decision on

8 folks now, and then people later, because that

9 could change the mix?

10 MR. BANTLE: I would open that up to the

11 Working Group. We are in uncharted territory. 

12 Obviously, additions to the Subcommittee would

13 have to be provided by tomorrow, as the

14 Subcommittee starts working Thursday morning, and

15 we would obviously have time, have to have time

16 for all parties to make, you know, adequate

17 considerations prior to taking consensus check.

18 MR. LACEY: Well, for my part, my

19 recommendation would be that we wait until anyone

20 who's going to be proposed to be on the

21 Subcommittee, all those proposals have been made,

22 and then we make a decision on the composition of
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

345

1 the Subcommittee all at once.

2 MS. WEISMAN: Do we anticipate people

3 having others to propose? Because I think, just

4 to restate where we were earlier, our intention

5 was for the Subcommittee to be a very small

6 Working Group.

7 We have a very small room reserved. We

8 have made many attempts to secure other space at

9 no cost, and have been unable to do so.

10 So, our intent was to keep it a very

11 small Working Group who would, again, come back

12 and report everything that they wanted to

13 recommend to this Committee.

14 PARTICIPANT: Okay.

15 MR. MURRAY: I agree with Aaron that

16 maybe we could wait until tomorrow and do this

17 vote.

18 I also want to state for the record that

19 we did have a very explicit conversation about

20 the fact that my colleague expected to offer an

21 additional individual or individuals for this

22 specific Subcommittee at length yesterday, where
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

346

1 questions were asked, they were answered.

2 And so, this was a very public exchange,

3 and I think that we all knew that my colleague

4 was going to offer individuals for the

5 Subcommittee.

6 And so, just in case, now that we've had

7 this extensive discussion, anyone would like to

8 offer anyone, I think it would be best if we

9 delayed the vote until tomorrow, giving anyone

10 else an opportunity, even though this is supposed

11 to be a very small group, give all of my

12 colleagues their opportunity, and maybe

13 overnight, we can all remember that discussion

14 and evaluate the individuals that are proposed or

15 could be proposed on the merits that they come to

16 us with.

17 MR. BANTLE: Okay. Just a little

18 facilitator prerogative here, unless I hear an

19 objection to waiting to tomorrow, we will do

20 that, and then we will use our limited time to go

21 through a few items very quickly, and then

22 provide time for public comment.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

347

1 So, that being said, if any other

2 Working Group members do have petitions for

3 Subcommittee members, please, I'd let the

4 facilitators know as quickly as possible, so just

5 we can, we can take care of that. Michael?

6 MR. BOTTRILL: Point of context on that. 

7 So, if, as you've pointed out, apparently I have

8 representation on the Subcommittee already,

9 shouldn't we then, if the concern is around

10 transparency and having your particular, oh,

11 whatever, you know the word I'm trying to say.

12 If that's the concern about transparency

13 and the group that you represent, and if they're

14 already represented, shouldn't we limit that to

15 any areas that are not being represented, and

16 there's a concern there, rather than just anybody

17 bringing forth another person?

18 MR. BANTLE: I would open it up to the

19 Working Group, although I would say, as a

20 facilitator, I think that could be evaluated at

21 the time of the consensus check.

22 That would be a factor that would,
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

348

1 people would, Working Group members could

2 consider when casting their vote.

3 Okay. It is 4:50. We want to leave 10

4 minutes for public questions, or public comment. 

5 But we do have a couple items just to run through

6 quickly for the, that I wanted to run by the

7 Department.

8 We had a couple information requests

9 today. Could we just get a quick status update

10 on that, and then, I know there was a request for

11 Mr. Manning's remarks, a status update on that as

12 well before we go to public comment.

13 MS. WEISMAN: We made note of a couple

14 of data requests. We have made those requests to

15 the appropriate offices within the Department,

16 and we are waiting for word back on the answers

17 to those questions.

18 Regarding Mr. Manning's remarks, we will

19 be posting those to our website. That addresses

20 this rulemaking effort.

21 So, I don't know, necessarily, if we'll

22 have paper copies to give out to everyone, but
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

349

1 they will definitely be on the website.

2 I know we've been asked for both, and

3 so, I'm waiting to hear back on that as well. 

4 Unfortunately, as we go to break, I end up

5 talking to numerous people, and so I don't always

6 get to circle back with everyone on my list.

7 So, it's not that we did not hear the

8 concern. They are all in progress. And again,

9 we will be posting those at a minimum, and that

10 way they'll be available for everyone to see. 

11 And I do appreciate the requests, but we are

12 working on all of them.

13 MR. BANTLE: Yes. And just as a

14 facilitator with information requests, process

15 requests, and other requests, we are keeping a

16 tab. I am keeping track of that on the side.

17 PUBLIC COMMENT

18 MR. BANTLE: So, with that, I would like

19 to open up the floor to any public comment. As

20 we did yesterday, could we get a show of hands,

21 just so we have numbers? Okay. Come on up.

22 MS. GOLDSTEIN: Hi. I'm Alexis
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

350

1 Goldstein. I work at Americans for Financial

2 Reform.

3 We're a coalition of over 200 faith

4 groups, consumer groups, consumer advocacy

5 organizations that work for a safer and fairer

6 economy.

7 I was here for the last negotiator

8 rulemaking on borrower defense. Quite frankly, I

9 am astonished that we are doing this again.

10 I'm hearing a lot of the same arguments. 

11 I'm hearing people re-litigating a lot of the

12 same points. This whole exercise strikes me as

13 an extraordinary waste of time and money.

14 But all that being said, we are where we

15 are. I wanted to bring the voices of some

16 students to this room.

17 I've heard a lot today. I've heard a

18 lot of martyrdom. I've heard a lot of victimhood

19 from the representatives of for-profit colleges

20 and other institutions around this table today

21 talking about these poor schools and how we're

22 trying to do so many horrible things to these
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

351

1 poor schools, and we can't box them all in.

2 And I'm hearing a lot of suggestions to

3 create this process by which students have to go

4 up against their institution before they can

5 bring a grievance, before they can file a claim

6 with the Department, with the government.

7 And that's, quite frankly, a rigged

8 game. We see that in forced arbitration, which

9 is an area that my organization works in a lot. 

10 That's a rigged game too. Most consumers do not

11 get anything when they go to arbitration.

12 I know that that's a thing that we will

13 discuss at a future date, at this negotiated

14 rulemaking.

15 But I don't see how a student who is

16 almost never going to be an attorney, going up

17 against an institution that has millions in

18 dollars, tons of legal counsel, tons of legal

19 expertise, is ever going to have a fair shot if

20 they have to adjudicate that before they can

21 bring in a complaint to the Department of

22 Education. That just seems entirely unfair to
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

352

1 me.

2 I also just want to read some quotes

3 from a new report that came out today from the

4 offices of Senators Durbin and Warren. These are

5 some students who, you know, who couldn't come

6 today.

7 Last negotiated rulemaking, a lot of

8 students that I had talked to had some hope that

9 the Department of Education was actually going to

10 discharge their debt.

11 We know now that there's 95,000 students

12 who are still waiting for relief. This current

13 administration has discharged none of their

14 debts.

15 There's thousands of applications who

16 have been approved. The Department is sitting on

17 them.

18 You all are talking here in this

19 negotiated rulemaking about potentially doing

20 partial relief instead of full relief.

21 These are people whose lives have been

22 ruined, and I want to bring some of their voices
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

353

1 to you today.

2 So, this is Amy Schneider. She attended

3 the Illinois Institute of Art. This is an EDMC

4 school.

5 She says, this school defrauded me,

6 plain and simple. In class, we did not learn the

7 schools we were supposed to be learning.

8 Despite being on the Dean's List and

9 graduating with honors, Amy found it nearly

10 impossible to find a job upon graduation.

11 Employers didn't see it as a reputable

12 institution. If it is on my resume, it looks bad

13 or they don't care. The degree has never opened

14 up any gainful employment.

15 She is saddled with debt, even though

16 she was told that they would get grants and they

17 wouldn't have any loans. $76,000 was the tuition

18 they quoted, but she ended up with loans over

19 $100,000.

20 She said, they just took us out of

21 classes and had us sign things. My loans ran

22 out. They had my mom come in and write a check
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

354

1 for $5,000, end quote.

2 Since graduating, Amy has recalled being

3 harassed by Navient about her student loans. 

4 They would quote, robo-call me all hours of the

5 day, sometimes 20 times a day. They called my

6 grandparents in Florida who have nothing to do

7 with my loans, end quote.

8 Amy's financial struggles have caused

9 her significant distress. She and her mom fight

10 a lot. She got really depressed and she says

11 quote, I thought maybe I am better off dead, end

12 quote.

13 Then there's Heather Beckstead who's 

14 from Arizona. She attended the Art Institute of

15 Phoenix. Again, an EDMC school. She has $67,000

16 in federal debt, and $21,000 in private debt. 

17 She says quote, I was defrauded, I was lied to, I

18 was promised something I didn't get. My

19 government should care about that. I want to

20 feel that my government has my interests in mind,

21 but it does not feel that way now, end quote.

22 The Art Institute did not provide
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

355

1 students the resources necessary to succeed. 

2 Heather writes quote, there were not enough tools

3 to be successful. I would show up to class,

4 there would not be enough computers. I went a

5 whole semester fighting for a seat at a computer.

6 All of the tools were old. They were

7 outdated, they were broken, and they did not make

8 any attempts to fix them. Some teachers had work

9 experience in the field, but their knowledge was

10 very limited, not as qualified as we were led to

11 believe.

12 A lot of the times, students teaching

13 the, taught the class, students taught the class

14 or we watched tutorial videos on YouTube.

15 And finally, this is Nino from

16 California. He attended ITT Tech. He said quote

17 the whole education was basically a scam. It

18 ruined my life and I wasted two and a half years

19 of my life.

20 They didn't even say I would be in debt

21 after graduation. At the beginning, they told me

22 not to worry about having a loan, because I was
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

356

1 eligible for the highest financial aid.

2 Nino has $29,000 in debt. He attended

3 ITT because he wanted to pursue a bachelor's

4 degree in computer network systems, and upon

5 graduating, ITT told him it was guaranteed that

6 he would have a job. He quote, won't be in debt,

7 end quote and, the credits would transfer to most

8 universities, none of which was true for Nino.

9 These are three students. There are

10 thousands of students with stories like that. I

11 know a lot of them.

12 I know a lot of them who have been

13 waiting for their debt cancellation for over a

14 year, sometimes two years.

15 They're waiting for this Department to

16 act. This Department has not acted. We now know

17 that there are 95,000 applications that are just

18 sitting there in limbo.

19 These are people whose lives are ruined,

20 whose credit is ruined, who cannot move on, who

21 cannot take out other lines of credit because

22 they have exhausted it, and if I seem
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

357

1 exasperated, it's because I am exasperated

2 because these are my friends. These are my

3 colleagues.

4 They are not people just trying to scam

5 you. They are not trying to pull one over on

6 you.

7 They are people who tried to better

8 themselves, improve the life for their family,

9 and they can't because they're stuck. And

10 they're stuck in debt that this Department has

11 the power, has always had the power to discharge

12 the debts of, and you sit and you wait and it is

13 frozen.

14 And I am, I am so frustrated with this

15 process. I understand we have a negotiated

16 rulemaking to do. We will do it. We will

17 continue to do it.

18 I appreciate everyone's perspectives. 

19 But peoples' lives are on hold, and this

20 Department has the opportunity to stop having

21 their lives on hold and give them full relief,

22 not partial relief. And I beg you to do so.
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

358

1 These are people who just wanted to make

2 a life better for themselves. We, they believe

3 what we told them. Education is the path to a

4 better life. And that is not their experience.

5 Their experience is that it has made

6 their life worse, and that they wish they never

7 went there, and they take these schools off of

8 their resume.

9 Many of these schools, which are still

10 open, by the way, I am not just talking about ITT

11 and Corinthian. Art Institution is still a

12 functioning institution. There are a lot of

13 other schools out there just like that.

14 So, again, I implore the Department of

15 Education to discharge these debts as soon as

16 possible. These students have waited entirely

17 too long to move on with their lives. Thank you.

18 MR. BANTLE: Any additional public

19 comment at this time? Okay. Hearing none, it is

20 4:58. As usual, we are trying to be respectful

21 of your time.

22 So, I want to wish everyone a great
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

359

1 evening. Thank you very much for your

2 perspectives today, and please use the additional

3 last two minutes that we're giving you to review

4 Issue Papers 4 through 8 for tomorrow morning. 

5 (Laughter)

6 MR. BANTLE: Thank you very much.

7 (Whereupon, the above-entitled matter

8 went off the record at 4:58 p.m.)

9

10

11

12

13

14

15

16

17

18

19

20

21

22
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

360

A

a.m 1:11 5:2 73:11,12

150:7

Aaron 2:16 23:9,20

24:9 28:14 33:4 37:6

37:8,13 39:18 42:21

43:17 55:17 57:2

58:21 60:8 83:11 85:1

94:13 96:14 120:21

128:1 156:16 185:9

185:11 189:7,13,14

194:20 209:10 227:15

229:13 237:13 239:16

257:14 258:20 259:20

260:2 283:5 287:6

290:1 297:15 312:2

312:17 341:22 343:18

345:15

Aaron's 205:6 230:22

Abby 3:18 24:9 38:16

39:15 43:21 60:15

79:20 81:5 83:17

84:12 107:15 131:22

135:8 150:13,16

151:1 181:15 185:9

185:11 189:16 196:18

205:17 207:5 218:5

223:12 227:19 233:16

234:17 236:15 244:16

250:6 251:10 255:2

314:8 315:6

Abby's 104:2 217:13

228:17 246:10

ability 40:21 50:21

95:17 148:5 311:6

able 6:14 23:15 27:15

35:22 36:1,14 39:19

43:1 53:20 58:12 61:3

61:14 62:8,9 65:5

70:6 83:20 90:8

110:11,16,22 115:10

122:7 129:19 138:22

146:4 152:20 167:17

167:22 171:18 186:22

187:3,5 189:1,19

198:8 203:5 217:13

225:6,15 230:15

242:1 244:20 245:10

253:7 255:16 257:22

259:13 261:1 263:9

272:8,11 289:21

291:3 314:3 327:19

331:11 332:21 333:13

333:15

above-entitled 73:10

150:6 266:10 359:7

absence 294:1

absolutely 43:11 47:20

65:16 157:21 170:4

192:6 196:19 258:20

abstract 50:1

abundance 234:8

abused 61:20

academic 171:10

309:13,22 312:22

accept 12:20 127:12

130:13 134:7 158:16

312:22

acceptable 188:9

accepted 131:8,12

309:11 321:22 329:8

access 20:19 29:11

43:13 60:12 102:5

186:22 187:5 195:22

209:16 216:9 255:16

278:5 279:18 297:8

304:2,2,4,11 307:13

accessibility 101:14

accessible 187:7

189:12,21 196:5

201:9,15 225:2

accessing 164:22

accommodates 103:19

accommodations

257:20

accomplish 219:15

accomplished 335:17

account 204:15 291:10

accountability 2:2

340:10

accountable 55:14,15

57:20 308:5

accountant 329:15,20

335:2,5

accountants 71:1 331:5

332:9

accounting 3:2,3

270:22 273:5 288:21

291:9,14,16 295:9

305:5 325:9 326:4

328:5 329:2 331:1

334:22 339:3

accreditation 51:18

77:14 89:22 93:14

98:21 99:2,4,6 100:2

100:3 112:1 282:9,11

accredited 51:12,14

100:4 112:13,15,18

116:15

accrediting 3:1 93:15

201:22 202:10,22

259:9 281:9

accreditor 300:7

accreditors 116:15

222:12 310:13

accrue 204:4 206:5

253:17

accrues 14:15

accruing 135:19 204:15

accumulated 127:1

accurate 181:22 295:11

accurately 20:20

accuser 257:18

accustomed 108:11

acknowledge 59:14

220:13

acknowledging 20:4

105:17

act 76:13,16 79:12

81:13,18 84:21

122:13,21 124:11

158:7 267:2 356:16

acted 25:22 88:20

292:11 356:16

Acting 4:11 6:16

action 34:21 38:7 48:17

53:8 58:4 85:16

138:17,19 157:20

158:22 177:21 205:13

300:7

actions 79:6 111:16

210:14,16 262:9

282:19

active 80:20

actively 25:7,9

activities 22:20 179:21

277:8

activity 199:4,9,21

actor 220:7

actors 118:18 220:6

312:8 313:15,16,21

314:7 320:9

acts 81:7,19 85:19

actual 33:10 44:4,21

193:20 220:22 285:17

add 29:17 42:14 55:6

128:8 240:1 258:22

274:12 324:6 336:5,8

337:13 338:4,6

341:12

added 32:6 343:17

adding 324:4 336:6

addition 36:20 37:7

52:7 55:7 86:11 138:8

188:13 208:16 224:9

225:13 228:7

additional 10:21 32:1

85:2 87:21 134:3

158:13 191:17 259:3

271:15 281:4,10

292:19,20 295:12

296:4,8 311:18

313:13 314:16 317:2

336:5 342:8 343:12

345:21 358:18 359:2

additionally 9:16

additions 344:12

additive 313:2,8

address 22:11,18 116:9

140:3 195:15 199:6

200:1 213:9 218:2

219:17 266:19 277:18

277:20 295:18 305:8

305:15 309:16

addressed 119:11

138:12 151:9 255:4

266:17 305:12

addresses 32:9 97:11

348:19

adequate 76:3,21 294:8

311:3 344:16

adherence 22:12

adjudicate 8:6 10:21

14:14,19 15:16 94:20

189:4 351:20

adjudicated 142:20

185:7 286:10

adjudicating 13:15

14:13 15:3

adjudication 10:16

181:6

adjudications 15:8

adjust 9:21

adjustments 13:14

60:10

administer 7:15

administered 330:2

administering 8:10

administration 3:17

8:19 9:4 11:1 160:9

315:4 343:5 352:13

administrative 36:13

121:3 160:1 182:13

183:3 190:19 193:7

194:7 197:6,8,11,18

197:20 198:17 199:1

199:8,19 203:18

204:2,21,22 205:19

211:1,5 213:14

214:20 253:16 266:22

267:4 321:17 323:11

334:11 340:17

admission 51:16 52:6

53:3,4

admissions 51:21

228:3

admit 14:21 131:15

164:17

admittedly 340:4

adopt 31:14 76:6

adopting 28:18 31:9

32:14
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

361

advance 111:4 153:22

advantage 6:10 66:22

107:6 186:21 216:6

224:6 261:7 269:21

advantageous 253:12

adversarial 229:5

235:22 246:3

adverse 197:2

advertises 52:20

advised 254:21

advising 103:9 310:3

advisor 3:15 51:21 52:6

340:8

advisors 51:17 52:21

53:3,5

advocacy 121:8 350:4

advocate 13:19 96:12

333:11

advocated 193:9

advocating 163:12

241:13

Affairs 1:19 2:7,13 3:5

affect 271:5 325:10

affidavit 228:20

affiliated 205:10

affirmative 185:19

297:21 298:8

affirmatively 188:14

affirming 32:2

afford 241:5

affordable 68:14

afforded 240:22

affording 285:2

afraid 89:4 304:18

afternoon 30:9 147:17

150:10 266:15,17

328:10

agencies 38:5 50:10

106:16 112:21 113:2

113:2 116:5 197:19

201:22 202:11 259:9

260:6

agency 50:11 112:16

179:22 180:8 188:20

227:17 259:8 281:9

289:17

agenda 334:10

aggressive 53:4,6

54:10

ago 164:14 259:22

275:18 293:15 342:17

agree 19:21 21:5,18

28:14 37:4 42:22

43:20 48:19 77:6

83:17 87:11 93:19

98:1 108:4 109:18

143:20 157:15 159:7

160:4 163:14 167:5

189:16,17,20 192:5

192:14 212:21 217:12

218:6 219:18 220:2

239:18 243:2 258:20

259:15 298:17 306:2

306:8 320:2 345:15

agreed 5:21 20:10

29:20 246:16

agreement 27:11 149:4

149:8 182:22 217:21

agrees 124:8

AGs 81:4 86:15 96:17

104:21 225:17

ahead 5:4,7 49:12

73:14 140:10 154:20

184:17 300:9 315:20

aid 2:4,8,18 3:14,19

164:11,12 187:2

211:3 330:2 356:1

alarm 67:16

albeit 342:15

Alexis 349:22

ALJ 123:11 183:3,8

190:9 209:12 230:4

ALJs 161:4,20

allegation 268:3

allegations 193:18

215:5,11 317:7

alleged 106:1 200:13

alleviate 33:13,15

allocate 245:16

allocation 46:19 47:18

48:3 169:20

allow 13:5 29:22 41:1

70:19 86:16 125:22

142:1 183:21 190:10

190:12 192:8 207:15

264:21

allowed 21:3 139:3

215:9 305:17

allowing 185:19 210:21

233:14 252:5

allows 20:11 43:15

48:12 138:16 222:11

232:17

alphabet 81:8

alternative 275:1,4

alternatives 285:2

287:1,20

Alyssa 2:4 119:17

128:6 135:6 141:15

143:20 165:8 167:19

178:4 205:17 241:18

250:5 256:22 259:16

311:19

amend 255:13

amendment 75:10

America 1:18 2:13

American 2:20 3:7 9:8

92:20

Americans 350:1

amorphous 47:2 127:6

175:21

amount 50:13 57:14

65:13 100:21 109:17

109:17 111:17 115:4

116:22 125:19 132:11

165:5 168:17 169:10

241:6 248:12 259:17

273:22 283:17 285:22

286:1 307:16 320:21

322:20

amounts 115:20 117:17

135:1,2,4,21 136:5,6

136:19 137:2,9 138:7

138:21,21 139:1,14

146:14 149:3 161:10

169:4,13,18 252:9,12

252:15

Amy 353:2,9 354:2

Amy's 354:8

analogy 44:22 114:15

analyses 283:14

analysis 3:7 294:6

342:8

analyzing 343:5

ancient 171:12

and/or 267:10 269:11

Anderson 32:6

ANN 3:13

Annmarie 4:15 32:7

119:14 136:21 141:10

141:12 148:20 154:9

155:8 176:5 186:1

279:22 295:20

annotating 108:20

announcement 5:19

32:8

anomaly 60:17

anonymous 257:4

259:7

answer 29:2 74:15 75:2

135:10 145:10 217:6

262:4,18 266:2 275:4

279:11 308:9,20

answered 27:19 185:11

346:1

answering 152:18

answers 74:9 87:16

95:22 348:16

anti- 258:22

anticipate 345:2

antithesis 200:12

antithetical 210:20

anybody 47:22 159:14

219:19 220:8 232:17

296:4 347:16

anyway 309:21

apart 159:11 326:20

341:1

apologize 102:15 293:2

apparent 242:8

apparently 347:7

appeal 183:7 232:21

233:1 236:6 239:6

246:1,2 272:9,12

appeals 190:20 239:11

245:18

appear 322:16

applaud 143:2

apples 306:9

applicability 14:1

applicable 8:15 12:9

87:12 267:16

applicants 13:3 52:22

application 14:3,17

77:17 79:3 183:18,20

184:8,16,19,22

187:11 197:9 253:19

applications 12:21

185:5,20 352:15

356:17

applied 79:6 146:1

331:8

applies 148:5 157:18

180:6

apply 15:6 83:5 118:12

123:9 197:7,20 329:7

applying 82:12 83:9

108:11

appreciate 26:10 28:12

39:18 57:10 79:3 80:2

87:18 97:7 113:15

153:20 169:1 209:9

215:20 260:19 265:10

286:13 289:20 323:5

323:6 349:11 357:18

appreciated 153:3

appreciating 27:22

appreciative 95:6

apprehensive 264:7

approach 186:3 192:5

271:20 304:4,4

310:18 316:22

approaches 311:3

appropriate 25:4 26:2

35:16 57:16 100:2

106:3 108:8 110:4

180:18 184:2 187:12

209:13 243:11 272:4

348:15

appropriately 100:4

303:20

approval 13:11 107:2
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

362

116:17

approvals 3:14 9:5

approved 8:19 9:3,19

10:4 11:7 12:2 51:4

198:3 206:14 254:22

316:9 352:16

approving 10:14 11:18

approximately 8:20 9:2

11:15 13:7

arbiter 240:12

arbitration 351:8,11

arc 120:3

area 2:8 69:14 139:8

149:14 351:9

areas 10:17 154:16

218:13 223:7 322:9

325:6 347:15

arguably 169:13

argue 19:7,12,22 78:4

188:12 234:14 239:12

247:1

argued 46:6

arguing 19:7 103:20

arguments 350:10

arising 153:18

Arizona 2:3 77:6 78:5

78:18 354:14

Arizona's 84:8,10

Arizonan 78:5

arrange 26:22

arranged 5:22 50:12

arranging 26:20 27:1

arrive 242:1,13

arrived 15:1

Art 353:3 354:14,22

358:11

articulate 230:1,12,19

articulated 76:2 139:5

230:5

artificially 198:22

ascertain 97:5

ascertained 88:9 89:16

98:14 111:19

Ashley 2:11 3:13 38:16

42:20 58:6 63:17

102:14,16 106:6

113:15 115:6 116:4

119:18 122:9 125:14

131:16,21 135:8

141:13 155:9,14,15

156:3 165:1 166:21

181:14 183:14 212:3

212:17 241:18 242:22

253:9 323:18 324:1

332:13

Ashworth 50:19 51:7

51:13,16,21 52:8,12

52:18,20 53:3,7,11

54:2

aside 125:16 227:2

229:16 293:5

asked 18:22 19:1 96:16

104:22 109:4 150:16

151:20 156:11 182:3

182:7 215:5 216:22

243:13 315:11 342:18

346:1 349:2

asking 113:22 115:3

128:17 144:5 154:4

167:18 173:14 306:5

asks 231:13

aspect 24:6 98:9

119:17

assert 140:15 146:5

assess 13:14

assesses 8:15

assessing 15:6

assessment 10:3

assets 260:7 262:22

assigning 94:12

assist 28:7 194:4

assistance 3:8 108:19

151:5 186:22

Assistant 2:2,11,13,18

3:2

Associate 2:19 3:16

associated 12:4,8

126:11 293:7

Association 2:9 3:4,7

92:20

assume 19:4 34:15

45:14 91:6 99:3

122:16 169:7 170:11

assumed 9:1 45:2

199:10

assumes 60:8

assuming 9:10 45:21

104:3,16,17 119:15

130:17 143:11 167:10

183:1 193:18 250:4

280:8 331:2,4

assumption 90:21

106:9,10 325:15,16

assumptions 16:20

17:2,3,17

assure 264:15

astonished 350:9

ASU 329:14

ASUs 340:21

asymmetry 43:6

athletic 69:2

atrocious 42:19

attach 163:1

attaches 205:13

attaching 162:6 166:1

attain 3:17 61:11

attempt 49:17 169:17

attempted 55:11 56:2

attempting 152:15

attempts 345:8 355:8

attend 42:12 164:9

212:14

attendance 136:12

166:9

attended 39:22 353:2

354:14 355:16 356:2

attention 7:20 21:20

138:9 237:20 283:18

attesting 229:11

attorney 1:17 2:2,3,4,6

2:21 3:18 50:9 77:20

79:7,16 84:4 188:19

210:8 248:3 316:19

351:16

attorneys 65:2 70:20

83:13 93:2,4 96:22

248:8

attributed 120:9

audience 18:11 196:3

335:15

audio 5:20 6:4 26:9,11

26:14 29:4 55:4

audit 165:4,5

auditing 113:3

audits 112:5 113:1

314:18

aughts 85:15

authored 150:17

authorities 215:2,7,12

225:18

authority 12:22 112:17

159:1,1 283:9 284:7,9

299:9,22 300:15

312:5

authorization 80:12

automatic 197:6 198:17

199:1,19 201:3

203:18 205:20 213:15

214:2 298:15,21

299:21 300:14,18

automatically 298:12

automation 67:18

available 26:12 92:16

150:14 173:9 184:9

185:15 187:7 227:13

287:4,5,9,13 288:4

294:9 349:10

avenue 264:22

avenues 275:12

averse 260:15

avoid 128:20 153:18

312:7

awarded 343:3

aware 73:19,21 95:1

141:16 142:6 153:11

175:22 216:18 232:15

287:10,12,16 288:3

awkward 335:21

337:21

Ayers 1:20 67:11,20

69:5

B

bachelor's 51:7 356:3

back 5:4,17 16:18 17:21

24:4,5 26:11 27:21

28:2 31:19 52:5 58:16

64:17 65:12 73:7 74:8

75:19 81:22 86:16

97:9 107:16 112:20

119:18,19 126:2

128:7 129:13 130:1

132:6,6,14,20 133:4,8

135:7 136:2 142:5

149:21 150:3 164:17

165:7,16 171:9,10,12

172:17 173:1,10,17

174:11 186:13 218:5

223:5 228:4 229:7

234:11 236:22 238:11

242:19 246:14 248:21

251:2 254:13 255:22

260:16 266:8 271:3

275:3 282:7 289:2

291:7 313:14 314:9

317:19 321:6,19

322:15 327:17 331:18

333:2 345:11 348:16

349:3,6

background 53:12,15

324:20 326:5 328:22

329:3 330:17 341:1,4

342:20

backing 233:9

backtracking 214:19

bad 59:8,9 66:19 67:4,5

67:5 91:6 97:21

118:16,17 119:6,7,8

186:10 215:16 219:8

219:8,19 220:5,6,7,10

220:12,17 221:5

256:15 265:11,16,16

292:16 294:2 298:17

306:8 312:8 313:15

313:16,21 314:7

320:9 353:12

bag 300:11

balance 91:21 92:4

214:11 233:4 260:7

balancing 72:3

ball 318:2

bandied 37:21
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

363

bandwidth 309:21

bankers 276:8,10,10

Bantle 1:11,14 20:4

22:10 23:2,13,17,19

24:8 27:6 28:16 29:14

30:16 31:4,17,20

53:16,19,22 54:19

56:22 63:17 78:22

79:19 81:5,21 84:6,12

84:22 95:19 96:5

102:8 106:6 109:13

118:1 119:10 120:2

120:21 125:13 127:20

128:6,22 130:2,22

131:15 133:6 134:19

147:2,15 148:16

149:9 152:8 156:1

158:13 159:14 162:3

175:20 335:12 337:1

337:5,19 339:4,6,16

341:9,22 343:12

344:10 346:17 347:18

349:13,18 358:18

359:6

Barmak 3:6 292:21,21

292:22 318:22

barriers 101:22 114:17

253:5

Barring 20:21

base 10:14 66:14 96:2

106:10 109:15 182:10

323:21

based 61:12 133:1

135:15,16,21 166:8

169:8 173:6 177:19

177:22 178:3 237:11

252:20 270:3 273:17

273:19 291:17 301:3

baseline 105:21

bases 141:4

basically 43:22 75:4

105:1 130:16 151:16

355:17

basing 126:13

basis 36:5,18 37:17

46:17 81:16,17 86:6

86:12,17 87:1 90:7

124:3 134:11 175:14

276:18 283:14 293:12

310:17

basketball 114:3,8

Bay 2:8

BD 256:2,5

bear 41:6

beat 114:11

Beckstead 354:13

becoming 51:20

bedrock 172:17

beg 357:22

began 9:11 11:11,17

begged 144:10

beginning 6:3 53:12

222:19 223:21 239:3

239:10 240:17 245:18

272:10 355:21

begun 6:5

behalf 142:18 144:7

195:11 196:15 202:5

210:9 211:3 241:13

behavior 63:7 97:15

222:3 292:16

behaviors 28:4 256:21

298:21

believe 5:9 20:10 25:20

26:5 36:16 77:8 78:2

79:10 81:9 83:2 85:13

100:5 102:4 108:14

124:10 142:8 146:2

157:21 195:17 206:4

213:19 216:15 243:2

265:22 286:7,18

301:6,10 315:13

323:16,17 336:16

355:11 358:2

believed 287:7

believes 108:6

benchmarks 312:4

beneficial 13:17

benefit 43:2 125:5

benefits 53:1,14 68:8

116:12 133:20 255:1

Bennett 328:12 334:19

best 26:6 83:6 153:20

168:22 192:6 252:4

281:15 311:4,7 312:3

346:8

better 16:17 18:6 44:18

48:8,14 107:7 186:8

207:18 212:2 213:1

216:2,5 309:13

310:15,16 312:13

313:3 328:15 354:11

357:7 358:2,4

beyond 132:4 223:16

230:1,17 234:19

245:12

Biddle 3:21

bifurcate 168:5

bifurcated 156:21

157:14 159:19 161:17

162:1 163:7,15

168:21 169:21 170:5

171:4 193:10 201:7

235:3 238:1 240:15

bifurcating 59:18

bifurcation 170:19

190:2 233:19,19

big 65:2 66:3 78:21

171:4 238:5 246:21

248:18 330:11

bigger 118:22 181:16

biggest 171:15 264:9

Bill 51:4 195:18,22

billable 136:8,14

bimonthly 283:13

binary 280:18 281:6

282:12

bit 16:17 21:16 49:21

50:17 55:3,4 65:3

75:16 88:2 91:12

94:16 95:8 96:19

107:15 117:11,16

154:21 172:1 195:12

212:19 214:19 222:11

238:4 251:2 296:1

303:8 308:16 309:1

314:15,21 318:1

319:17 328:15 329:17

329:21 335:21 337:21

bitty 119:1

black 1:17 247:14

300:22 301:13 302:8

313:6 328:13,20

Blake 324:13 340:3

blame 72:9

blanks 32:5

blatant 306:9,11,15

blocking 126:22

bloggers 18:10

blower's 262:6,9

board 3:3 52:2 271:1

288:22 291:14,16

301:19

boards 35:16 291:9

bodies 105:18

body 27:10 93:15

202:18 210:15 270:14

331:20,21

bold 98:22

bond 260:6 280:10

287:12 292:14 302:21

bonds 285:8 287:11

302:19

books 80:22

boot 44:9

borrower's 111:16

148:5 225:14,19

borrowers 10:1 11:19

12:2,12,22 14:7 36:6

36:19 39:22 61:2,19

61:20 85:12 91:21

97:5 110:14,17

147:21 163:10 175:6

180:6 185:1,15 186:4

186:19 187:3,7,16

188:14,17 208:22

211:6 213:18,22

215:4 223:14 226:12

249:6 251:5,13,16,19

251:22 252:11 255:7

255:14 274:17 276:6

317:10,14 318:4,13

boss 275:20

BOTTRILL 1:17 28:11

33:3 34:9 77:13 88:6

89:20 136:21 137:6

137:21 180:11 181:13

203:17 204:16 227:16

233:18 259:7 279:21

289:15 303:5,7,15

325:2 337:20 347:6

bought 294:20

box 86:1 211:18 313:6

351:1

boxes 284:19

boxing 284:10 300:14

brainstorm 306:6

brainstorming 261:4

breach 86:7,9,12 87:1

87:11,13

breaches 87:3

break 71:12 73:6 86:22

119:12 149:15,21

150:1,2 241:20

255:20 266:7 349:4

breaking 338:8

breaks 149:14

breath 148:13

BRIAN 4:13

brick 80:15

brief 71:14 113:16

120:1 174:4 266:11

286:20 335:14

briefly 6:14 8:7 21:12

60:7 63:22 78:22

115:3 133:6 136:4

143:3 154:10 265:7

bring 28:5 58:16 147:4

162:4 167:17,22

218:17 264:6 330:4

330:14 335:4 336:4,8

336:12 338:4 350:15

351:5,21 352:22

bringing 79:17 85:12

289:2 295:5 347:17

brings 45:11 267:20

broad 87:8 283:8

broader 56:15

broadly 297:5

broke 154:13

broken 355:7

brought 50:11 70:15
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

364

79:10 134:22 162:8

163:6 177:19 205:21

206:21 210:17 213:4

219:20 260:20 262:13

283:4 287:11 331:11

336:17,20,21

Brown 1:18 330:10

Bryan 1:17 247:6

Bryan's 250:4

budgetary 9:22

build 77:3 98:12

building 10:18 91:11

301:7

built 11:2 262:16

bullet 27:18 30:18 32:1

49:8 57:12 74:19 76:1

87:20 88:7 91:13

175:16,16,19 176:6,8

178:3 197:5 229:2

250:2 279:22 296:2,5

296:7 315:8,8,8

316:22 317:1,21

Bullets 32:20 49:9,13

bunch 70:19 189:7

286:8 300:13

burden 31:8 42:15 43:7

78:13 87:22 89:7 90:3

91:9,14,16 96:9 97:9

104:22 112:11 113:6

148:14 236:10 281:11

286:5

burdened 43:8

burdens 30:13 31:11

105:1

burdensome 92:1

buried 100:7

Busada 1:20 33:7 63:13

63:21 118:6 170:16

171:1 218:2 221:12

221:15 246:9

BUSH 2:1 94:14 96:4,6

business 2:7,16 3:4,10

10:15 11:4,20 341:20

businesses 17:20

220:5 341:5,17

busy 149:14

buy 47:10 91:4

buying 90:18

C

C 1:11 20:10

cabinet 113:11

calculate 93:12,13

117:13 125:19

calculated 272:18

274:15 286:3 326:17

calculation 125:16

128:14 305:19

calculations 272:22

California 9:10 78:17

355:16

call 19:2 53:12 54:4

161:12 275:13 279:6

called 61:1 64:16 69:12

131:17 224:13 334:15

354:5

calls 53:4

campus 99:1 141:21

205:9,9,12 224:14

283:16

cancellation 356:13

candidate 334:5,7

339:21 342:19

cap 294:21 319:6

320:21

capabilities 315:5

capability 267:1,4

340:17

capital 260:12

capitalization 294:8

capitalizing 214:8,9,10

253:17

Capitol 1:11

capture 161:13 297:12

capturing 306:18

car 144:11

card 120:19

cards 141:8 146:9

194:15

care 55:20 192:3

321:18 347:5 353:13

354:19

career 1:20 3:1 9:8 10:6

52:14 67:12,20 69:5

111:5

careers 51:3

careful 87:6 104:19

132:2 144:20,22

190:22 214:6 277:19

277:21 285:14 321:14

carefully 13:21 297:11

319:5

carelessness 95:15

cares 191:19

Caroline 4:12 38:15

73:15 74:7 139:16

186:1

cart 303:8

Caruso 1:12,15 5:3

16:2 32:18 37:3 38:15

39:15 42:20 43:17

49:6 58:6,21 60:6,15

61:22 62:17 63:12

71:10 73:5,13 74:7

75:21 77:11 83:10

86:21 87:9,14 88:5,14

89:13 90:10,14 92:8

94:13 96:14 98:10

99:15 100:16 104:20

107:14 109:11 111:9

113:13 115:1,15,21

116:18 141:7 150:9

165:1 166:21 167:18

170:8,21 172:22

173:21 176:4 178:1

178:14 179:7 180:10

181:14 183:14 185:9

189:6 194:10 196:16

197:13 199:17 201:4

203:14 205:17 207:5

212:3,17 213:12

214:15 218:1 221:9

221:13,16 223:4,12

227:15 229:13 231:11

231:19 335:19

case 19:12 55:3 72:18

89:10 101:12 105:3

124:19 129:20 143:1

167:22 171:16 178:11

180:7 195:4 204:19

206:21 213:11 224:3

241:14 276:18,18

294:7,9 302:20 346:6

cases 56:12 57:21

59:12 72:4 118:20

143:12 185:1 227:1,9

233:9 261:13 276:18

318:21 319:14,17

cash 280:20 283:14

285:6 287:21 291:3

293:19

casting 348:2

catalog 98:17,19 100:8

103:4,6 228:5

catch 232:17

category 11:16 195:3

caught 295:10

cause 40:9,15 85:16

138:17,18 158:22

308:1

caused 354:8

causes 262:9

caution 208:12

cautious 254:4

Cedar 69:12

celebrity 69:7

Center 2:11 3:18 84:16

centered 30:12

cents 278:7

centuries 172:18

CEO 1:17

certain 105:13 135:15

156:7 183:6 284:6,10

certainly 5:7 12:19

20:22 21:9 26:10,18

61:10 71:19 84:7,9

110:4 122:10 185:3

188:7 189:20 195:21

200:2 233:3 234:14

247:12 260:6 271:8

288:7 296:5 297:2

322:7

certificates 51:5 52:13

certification 99:9

229:18 258:12

certified 194:3 230:17

certify 133:10 193:16

cessation 199:9

cetera 54:9 155:15

192:12 194:9 222:15

270:5 301:12

CFO 1:17 113:10

challenge 15:4 71:19

92:18

challenges 82:11

330:12

chance 67:13 96:17

130:12 193:1,4

322:14 334:18,21

chances 118:11

change 160:6 237:7,18

292:1 344:9

changed 165:16 255:11

257:10 295:9

changes 33:12 64:20

288:22 305:7,10,16

305:18 325:8,14

329:14 331:1 338:18

339:3 342:8

changing 64:14,16

310:3

characterization 23:7

153:8,13

characterize 35:5

characterized 35:12

291:22

characterizing 22:14

23:12 24:20 25:16

charge 136:14

charges 136:8

charitable 220:11,12

charities 220:4

cheap 70:22

cheaper 65:21

check 111:12 140:8

141:10 146:12 147:16

158:5 194:17 211:18

214:17 218:1 303:12

339:22 344:17 347:21

353:22

check-in 241:19 244:17

checklists 103:8
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

365

Chief 2:6,10 3:10

childhood 51:8

chill 208:19

choose 52:12 204:3

chose 144:11 198:9

chosen 251:17 342:10

Chris 2:4 81:5,21 83:10

90:15 92:8,11 201:4

chunk 177:18

churches 220:4

circle 322:14 349:6

circulate 84:18,20

circumstance 135:15

137:11 247:11,13

circumstances 89:17

111:16 183:6 184:1

191:15 223:18 228:18

293:13 316:21

citations 151:13

cite 132:16

cited 42:16

City 64:7

Civil 202:11

civilizations 171:13

claim 8:15 12:4,8 13:4,6

13:22 38:13 46:17

52:11 59:21 63:5 79:9

79:18 82:14 90:1,5,8

96:8 104:9 105:21

125:18 129:10 130:12

138:19 142:20 146:5

156:13 157:3,10,19

161:5 167:17,22

175:4,14 177:21

178:4,12 179:11

181:9 182:19,21

185:4 190:12 192:8

192:19 193:13,16

201:16 202:14 206:6

206:19 207:11 209:20

218:21 223:11 224:8

228:2 230:5 231:16

231:18 235:1 236:21

241:5 242:2 244:6,7

245:2 250:13 256:2,5

256:17 259:3 262:5,6

262:10 263:4,4,20

264:6 268:3 272:12

275:7 278:22 316:9

351:5

claimant 229:8

claimants 10:10

claimed 51:7

claiming 123:22 124:20

129:9

claims 6:13,19 7:14 8:3

8:6,14,20,22 9:19

10:4,9,14,15,19,21

11:7,10,11,14,15,18

12:2,14,19 13:7,12,16

13:20 14:9,11,14,15

14:19,22 15:3,7,9,11

15:12,16 52:7 58:13

61:3 77:20 82:9 83:4

85:12 86:7 92:3 94:21

147:10 174:14,20

176:18,21 177:18

180:15 182:1 183:17

184:7 185:2 193:22

200:8,11 201:1

206:13,17 211:7

213:9 215:21 216:9

216:10,14 225:3,7

226:9,11,18,20

228:12 229:1 259:14

268:11 269:7,12

277:16 278:15 285:17

286:8 290:2,13 307:9

307:16 313:18 315:11

316:16 317:11 318:4

318:13

clarification 23:10

26:14 38:18 167:7

170:16 218:4 237:5

249:22

clarified 232:4

clarify 30:10 31:3 82:4

115:17 147:5 163:7

165:3 198:6 221:18

244:19 270:9,16

286:21 327:11

clarity 183:15 245:3

class 68:21 210:14

353:6 355:3,13,13

classes 52:12 353:21

clean 44:18

clear 25:5 29:18 31:12

35:8 45:5 54:18 86:2

87:7 95:9,11 96:10

102:20 103:1,20

105:11 106:2 107:19

113:17 114:20 158:11

175:6 180:14 183:10

183:13 189:11 196:4

220:1 235:11 273:4

273:14 274:14 342:5

clearer 11:8 337:12

clearinghouse 113:1

clearly 59:3 116:17

122:6 239:18

clients 103:5 202:5,8

218:19,20 238:16

283:12

climate 248:15

clip 236:1

close 11:10 14:12,21

78:3 191:7 246:20

268:7,7 290:5 307:15

closed 121:21 122:2

173:7 176:11 177:22

178:7 181:2,9 182:5

183:22 184:4,9,13

190:21 191:10,16,17

192:1 205:6,12,15

229:18 233:22 250:3

251:3,6 258:11

271:21 272:1

closer 243:22

closes 122:2 205:8,9

closing 278:17

closure 176:16,19

177:8,14,19,20

178:19 179:5 184:12

234:2 269:10 273:12

278:20 279:3 290:22

290:22 300:6

closures 281:19 289:16

293:16

coalition 350:3

Coburn 2:16

cognizant 247:15

coincide 156:15

Coincidentally 67:18

collapse 294:22

collateral 276:13

289:13

colleague 78:5 143:4

320:11 345:20 346:3

colleagues 295:7

346:12 357:3

collect 79:21 108:5

166:15 179:14,15,19

collected 252:13

collecting 146:7

collection 156:7 179:21

185:16 199:4,9,21

collections 3:8 163:11

211:2,6,8,17,20

collective 126:14 159:5

collectively 159:7

Colleen 3:20 317:16

college 1:20 2:8 3:4,6

52:12 62:20 64:9

67:12,20 69:6 243:20

244:3,6,13 247:11,21

259:17 278:2,4 279:2

301:12 309:14 328:12

328:13 330:10 332:17

334:15,15,19

colleges 3:1,7 276:17

277:5,9,14,22 300:21

300:22 301:13 302:9

328:20 330:12 350:19

colleges' 260:11

collision 75:13

Columbia 76:11

combinations 80:16

come 16:4 17:6,8,12,21

24:5 31:18 42:9 44:17

47:6 48:5 59:13 63:22

64:17 68:10 69:16

70:7 73:7 82:15 83:6

97:13 116:8 119:4

120:11 126:2 134:2

145:20 149:21 158:20

171:18 172:14,20

174:18 188:8 189:3

192:9,22 193:17

194:2 202:20 218:4

219:5,13 222:1

236:22 246:13 253:7

266:8 269:4 270:2

275:3,10 279:16

301:17 322:12 324:19

325:10 327:16 328:8

328:9 333:2 345:11

346:15 349:21 352:5

353:22

comes 13:21 24:4 35:3

151:1 253:10 254:13

comfort 285:13

comfortable 24:9

coming 6:7 22:6 26:6

26:11 89:19 101:4

106:18 128:7 130:4,6

196:2 246:10 291:7

312:11 313:1,18

commensurate 89:11

comment 21:3 28:11

37:3,6 63:13 74:12

82:3 87:15 104:22

115:3 119:21 126:12

131:1 147:2,15 154:6

154:6 155:17 156:5

156:17 159:15 178:17

194:20 197:15 201:6

205:6 217:13 262:22

262:22 278:13 334:12

338:22 343:19 346:22

348:4,12 349:17,19

358:19

commented 22:13

312:17 339:12

commenting 118:5

comments 16:10,10

20:1,6 23:8 27:7 28:1

30:11 31:16 32:1,21

55:2 56:17 58:22 59:1

74:2 103:2 116:1

119:13 120:22 127:20

137:17 148:17,20

153:8 154:2,19 155:3
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

366

156:2 158:13 194:16

201:8 205:6,18 206:1

206:12 211:1 212:6

212:20 215:20 221:10

229:15 255:19 260:19

290:1 295:13 320:3

323:14,15

commission 3:1,12

53:8 81:13 248:11

commit 29:8 221:1

commitment 7:8,22

15:21 27:5,9,10 54:5

292:15

commits 8:16 46:1

committed 238:9

246:17 267:16 307:1

committee 1:3,10 7:5

16:15 19:20 20:11

25:18 47:17 54:13

60:18 83:20 111:22

113:5 138:12 145:10

269:1 270:13 280:17

306:5 324:4,16,21

325:4,8,18,20 327:1

327:10,14 329:8

331:5,18 332:1,11

333:3,9 335:5,16

336:5,7,9,11,13 337:8

337:14 339:9 341:15

343:14 345:13

Committee's 272:20

committees 278:11

committing 308:6

common 26:4 33:19

109:8 189:9 213:2

commonly 242:18

communicating 332:15

communication 23:16

310:16

community 65:8 70:15

89:22 108:19 151:5

195:16 211:3 282:9

company 59:4

Compass 2:15

compelling 143:6

competitors 334:20

335:9

complaining 213:20

complaint 52:18 53:2

202:14,17 222:7,8

248:16 351:21

complaints 201:20,21

202:1 203:4 222:17

222:21 223:1,2

227:18 259:8 261:14

complement 81:17

complete 115:18

121:11 122:5 132:22

133:3 138:4,6

completed 11:11 343:3

completely 169:6 246:9

250:14 281:22

complex 11:14,16

12:14 72:2 131:7

189:22 206:20

complexities 113:9

compliance 2:10 3:8,14

3:20 33:15 37:22 38:3

38:6,12 39:6 65:14

93:2,3 210:1 298:2

compliant 29:20 64:19

complicated 9:13 71:22

80:15

complicities 112:22

comply 80:10 81:1

component 257:17

258:21

components 45:15

194:1

composite 270:20

271:5 280:19 281:5,8

281:13,21 298:16

300:4 303:11,17

318:8 325:10 326:16

340:14 342:2,5,13

composition 344:6,22

compounding 71:6

compromise 6:7

computer 355:5 356:4

computers 355:4

conceivably 241:2

266:16

concept 44:3 48:11

121:1,20 127:6 191:4

237:16 289:9,11

313:14

concern 10:18 22:18

23:6 35:18 46:4 59:19

60:17 78:21 119:11

144:1 172:9 204:11

235:18 248:19 250:9

257:4 261:10 262:14

283:3 290:20 299:1

300:2 330:20 347:9

347:12,16 349:8

concerned 89:3 157:17

265:3 328:19 329:6

concerns 28:3,6 32:21

33:13 34:7 112:3

153:6,12,18 166:13

166:16 264:11,19,20

295:6 296:13 304:14

Conciliation 1:14,15,16

concise 152:15 189:16

conclusion 337:20

concrete 49:22 54:15

314:11,13

concurrently 94:22

condition 184:18 301:4

conditions 184:10

267:11 269:5 279:13

311:13 315:9 316:2

conduct 10:2 47:21

59:8,10 80:20 81:14

208:20,21 215:6

235:16

conducted 188:17

confident 13:13

confirm 181:11

confirmation 99:6

conflict 27:21

conformance 25:8

conforming 75:10

confront 257:17,22

confusing 33:8 36:22

44:17 50:2,4 63:11

confusion 33:16 44:13

congratulate 266:14

congratulations 338:2

Congress 137:9

congressional 1:10

278:11

connected 71:20

182:10 196:6

connection 56:10,20

Connor 151:6

consensus 19:10

126:14 218:5 303:10

325:1 339:22 343:17

344:17 347:21

consequences 67:3

301:21

conserve 325:20

consider 8:14 19:19

37:18 38:9 47:17 88:8

88:22 89:15 91:2

92:14 97:4 98:13

111:15,18 115:4

122:10 124:13 125:9

130:15 141:1 144:2,5

147:1 182:11 186:9

196:4,13 225:16,19

234:6 244:21 249:12

249:20 254:1 257:2

268:8 271:10,11

285:5 296:21 298:8

313:8 322:2 324:4

336:15 348:2

consideration 14:2

45:16 74:12 85:9

88:12 115:8 125:12

150:19 164:7 269:3

271:21 340:2

considerations 232:20

303:18 344:17

considered 58:13

185:21 231:2,8

240:12 273:16 331:20

considering 15:19

62:14 94:8 121:19

143:8 147:6 214:22

287:20 311:14 337:14

considers 7:14

consistency 77:17,22

consistent 15:11 25:12

81:11 91:18 109:22

142:22 158:5 210:5

229:17 258:15 273:2

consisting 10:6

consists 238:13

consolidate 11:21

249:7 253:13 254:5

254:12,21 255:7,15

consolidated 250:13

254:20

consolidating 13:5

consolidation 13:4

249:11,15 250:7,11

252:2,5,6,17 253:2,11

255:8,9,14,15

conspiracy 21:15

constituencies 18:14

19:14 20:18 21:1,8,17

24:17 26:8 37:15

55:20 324:7 331:16

331:21 333:18 336:3

337:17

constituency 24:22

25:9 26:7 336:6

338:13 339:14

constitutional 78:6,8

83:1

construct 162:22

construction 277:19,21

consumer 3:18 48:13

52:5 54:5,7 60:21

61:7,8,13 84:16 91:1

91:18 105:16,18

121:7 145:16 158:7

333:11 350:4,4

consumer's 53:13

consumers 2:21 55:21

97:8 324:10 340:11

351:10

consuming 7:6

contact 32:10

contemplated 115:19

137:7,10,13 139:13

contemplates 138:20

contemplating 240:21

content 28:10

context 24:1 34:10
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

367

36:13 86:20 108:22

150:17,22 163:16

179:11 236:15 238:13

241:1 325:14 330:14

347:6

contingent 293:6

continue 8:13 29:16

39:19 52:17 57:8 59:9

108:5 118:15 125:5

128:5 148:8 264:2

265:13 291:15 334:5

357:17

continued 12:20 118:9

continues 204:4

continuing 5:11 115:13

253:17

contract 3:20 26:17

29:1,7 86:7,7,9,10,12

86:17,18 87:1,4,11,13

contracted 6:1 30:1

contracts 61:1

contradicts 226:2

228:12

contrary 25:6

contribute 332:20

contributed 10:20

contribution 329:18

contributions 323:5

contributor 329:4

control 129:4,8

Controller 2:14

controls 10:8

conversation 27:18

49:15 56:21 58:18

72:12 73:17 129:22

139:10,19 155:2

168:3,4 183:9 198:19

249:2 284:22 293:2

295:16 297:6 309:17

324:6 326:12 329:5

330:15 332:10 335:3

337:2 345:19

conversations 20:15

21:10 311:5 322:17

334:22

converse 334:21

conversely 163:2

conversing 335:2

convinced 282:13

convincing 31:13 96:10

105:7,12 106:2

107:19,22

convoluted 33:9

cool 69:6

copies 151:16 152:3

348:22

core 45:15

Corinthian 8:21 9:5

13:8 14:22 126:21,22

143:15 178:18 179:4

185:1 226:12 294:18

294:19 302:21 307:7

318:20 358:11

Corinthians 15:8 330:9

corner 229:22 231:6

Corporation 3:9

corporations 188:3

correct 23:17 32:12

37:17 93:22 137:3

145:21 167:5 186:2

325:15,15,17 330:21

331:12,14 334:1

corrected 37:20 39:5

94:4

corrective 38:7

corrects 38:12

cosigner 276:13

Cosmetology 92:20

cost 41:6 125:4 130:21

136:11 143:21 219:2

260:11 345:9

costs 47:13,13 126:10

132:6 133:19 136:7

172:4 193:7

could've 294:20

Council 2:20 3:15

counsel 1:20 2:5,11

3:15 4:12,13 64:3

110:10 187:1,5,8

188:1 190:1 209:15

252:10 351:18

counseled 144:9

counseling 254:14

counsels 42:4

counter 254:13

counting 131:11

country 102:4

counts 225:11

couple 18:3 30:10

116:20 120:22 122:14

149:10 153:19 155:10

175:17 218:2 226:14

231:6 276:2 327:16

348:5,8,13

course 35:4 73:20

76:20 182:20 225:4

237:22 249:1 278:18

courses 341:7

court 192:12 225:12

courts 76:14

cover 47:12 117:7

209:4 277:15 323:7

covered 85:3 117:6

136:18 141:3 195:19

224:18 323:8

CPAs 331:5

craft 34:13 97:14

crafting 234:7

crappy 258:6

create 19:15 43:12,15

59:19 101:7 107:11

158:21 160:12,20

169:10,22 170:6

182:22 201:15 227:6

245:14 281:10 316:1

334:1,2 351:3

created 44:5 150:22

294:11 338:10

creates 163:20 221:20

creating 36:18 101:22

114:17 169:19 170:4

201:8 325:13

creative 6:8

credence 134:3

credential 124:15,22

127:13 129:10,12,18

credentialing 312:19

credentials 124:1 328:4

336:1 338:1

credible 226:4

credit 52:8,12 90:2

128:10,14,18 129:2

129:15 130:4,16

134:9 168:14 196:22

197:2 211:11 225:21

268:19 276:12 280:3

283:10 285:3,21

287:1 290:9,15

296:22 297:10,13

301:3,17 302:1

319:10,20 356:20,21

credits 50:22 115:9,10

115:12 122:1,4

124:15 125:1 126:15

127:5,7,11,12,13,19

128:17 129:9,12,18

130:10,14,19,22

131:7,14,17,19

133:11 134:6 312:18

356:7

crime 69:14

crises 293:21

criteria 251:7 312:1,11

criterion 311:16

cruel 89:6

crux 96:6

crystal 318:2

culminate 257:11

culpability 321:10

cumbersome 113:7

cure 49:1

cured 48:21

curious 198:1

current 6:13,19 8:8

11:9 35:6,20 58:12

138:16 140:13 165:14

179:13 185:22 250:18

255:10 267:13 272:17

272:18,19 280:13

293:18 294:1,14

295:17 305:1 325:10

352:12

currently 33:6 73:6

111:12 139:3,12

141:8 147:20 174:10

184:2 185:21 187:10

255:9 273:1 287:12

287:16 324:9

Curry 114:4,9

cut 30:16 198:18

cutting 121:9,9 154:2

200:2

D

D.C 1:11 82:13

dad 18:7 65:1 69:5 70:4

70:12

DALE 2:16

Dallas 2:17

damage 44:22 45:5

48:18,21 49:4 63:11

89:3 97:17 196:21

damaged 89:5

damages 45:15 46:13

48:11,11 49:1 55:12

56:20 57:14 62:22

63:7 88:18,21 89:1

103:15 105:21 120:18

200:14,15

Dan 2:19 23:9,19 60:6

74:17 102:16 115:15

117:17 134:22 137:17

178:14 179:7 185:13

196:17 237:14 247:5

259:20 271:16 275:17

279:10 310:10

Dan's 26:10 262:22

danger 78:16 121:6,8

206:15 279:2

dangerously 72:11

DANIELS 2:2 75:22

79:2 84:7

Danny 241:19 243:16

259:6 260:17 261:10

269:17 289:7 291:1

332:13 334:3

data 94:5,6 173:4,10

319:7 331:10,11

348:14

database 9:17

date 13:11 50:12 84:15

167:12 184:12 295:5
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

368

351:13

daughter 67:7

David 62:12 113:21

Dawn 107:15 111:10,13

113:15 212:3 271:16

DAWNELLE 3:16

day 5:6,11,18 15:10

27:14,17 28:9 32:7

70:2 71:15 102:2

111:7 150:20 176:13

190:18 224:4 230:14

243:8 244:9,9,9

321:18 322:11 334:11

337:5 339:18 354:5,5

days 9:3 19:3 164:15

184:12 192:20 193:14

197:3 236:3 243:4

244:11 327:16 337:8

dead 354:11

deadlines 242:18

deal 68:1 177:1 218:7

242:4 259:4

dealing 71:21 112:1,2

217:22 259:18

dealt 332:19

Dean's 353:8

debate 95:8

debated 7:7

debt 108:13 111:3

115:12 127:1 141:17

146:5,7 158:18 163:9

169:15 196:2,11

211:14 248:18 304:12

352:10 353:15 354:16

354:16 355:20 356:2

356:6,13 357:10

debts 146:1 352:14

357:12 358:15

decades 340:21 342:15

deceive 40:14

decent 65:12

deceptive 76:13,16

81:7,14,19 85:19 98:8

decide 204:6 235:8,9

235:20 240:20 241:4

245:5

decided 40:3 65:11,19

144:15 167:14 235:16

decides 130:10

deciding 40:7 245:4

decision 93:8 157:2,4,9

158:10,16,17 204:10

204:18 211:13 230:4

230:9,14 233:15

236:6 242:1,13 245:8

245:15,19,19,22

270:14,15 331:19

334:8 344:6,7,22

decisions 159:12 161:5

161:9,12,14,18,19

169:10 232:22 244:13

271:9

decreasing 212:11

dedicate 326:8

dedicated 135:12

136:15

deeply 329:6

default 135:18 180:7

185:20 186:8 189:19

211:9 212:10,11

255:10 276:14,20

304:7

defaulted 179:16

185:15 186:5 196:19

212:12

defend 178:12 213:3

258:4,8 261:1 264:17

defense 7:10,14,18 8:1

8:8,11,20,22 9:12

12:4,18,21 13:1,19

14:17 15:17 34:4,11

38:21 44:8,12 46:17

76:22 79:9,18 94:20

95:2 138:16 140:15

140:19 158:17 159:2

159:3 163:19 174:12

175:14 179:11,21

182:1 183:16,19

184:7,19 185:4 203:5

206:7 211:7 223:10

226:9 231:16,18

242:2 245:2 259:17

267:14 269:7,11

271:3 272:13,15

273:19 274:9 275:21

277:15 278:15,22

285:17 286:8 303:2

315:11 316:5,8,15

317:12 318:4,13

320:5 350:8

defenses 1:3 61:4

86:10 188:22 223:15

285:18 293:8 295:4

297:21,21 298:9

deficiency 283:1

define 45:13 162:19

173:13

defined 9:14 136:11

definitely 105:22

231:22 331:13 349:1

definition 36:21 39:3,7

76:6 77:10 81:12,14

93:17 233:21 234:1

definitions 44:14 58:10

74:21 76:3,8,14,21

81:18 163:3

definitive 312:4

definitively 66:20

defraud 46:4 144:18

defrauded 45:22 63:5

186:20 353:5 354:17

defrauding 45:18

degree 43:8 51:8,11

52:2,16 56:3,6 63:5

64:10 87:11 104:14

105:2,5 115:14 122:5

123:22 124:2,3,7

127:8 128:3 130:9,21

131:8,11 132:8,16

133:10 143:11 188:6

214:21 233:11 257:12

280:22 310:3 329:2

335:18 341:6 342:20

342:22 353:13 356:4

degrees 51:6 122:20

312:19

delay 250:18

delayed 8:12 13:2

197:19 255:5 346:9

delimiting 140:17

delineate 144:4 145:13

delineated 297:11

delinquency 135:18

delinquent 197:3

deliver 67:1

DeLuca 2:4,4 81:22

82:4 92:12 201:5

demonstrate 48:21

49:3

demonstration 44:22

denial 13:21

denials 14:6

denied 13:6,20 14:15

206:6,7

denigrate 25:9

denigrating 21:22 22:1

24:18

denying 10:14

Department's 40:20

105:3 197:22 245:1

283:3 289:20 293:10

316:10

departmental 159:21

241:12

depend 40:2,3 89:8

depending 78:19 89:2

117:8 156:19 166:4

168:4 176:10 214:12

237:19 286:1 294:7

297:18

depose 225:5

depressed 354:10

Deputy 2:5

Des 1:19

described 105:10

227:19

deserve 82:17

design 194:2

designed 329:12

desire 200:4

desperately 308:4

Despite 353:8

detail 174:12 296:15

331:4

details 239:12

deter 292:16 317:9

determination 13:4

99:22 112:18 190:6

209:9 236:19 286:10

315:14,15,16 343:21

determinations 90:5

269:13 285:18

determine 12:6 82:15

112:17 134:15 180:22

202:20 209:20 228:15

263:9,14

determined 205:4

269:10 286:17

determines 103:17

316:2

determining 88:12

109:17 111:17 115:4

117:13 157:7 172:17

191:21 325:3

deterrent 292:12

detriment 46:14

devastating 247:21

develop 284:3,14

299:11 310:18

developed 86:19 285:1

285:7

development 287:8

developmental 310:4

DeVos 7:17

devote 323:13 327:1

dialogue 87:19 310:16

die 163:11

differ 105:17 176:10

difference 171:5 190:8

273:15 310:6 330:11

differences 79:3 96:20

different 17:17 31:11

34:8,13,19 37:2,8,14

57:18 59:20 63:16

67:8 68:4 77:16,19

93:11,17,18 112:21

120:12,13 130:5

135:22 161:4 163:3

166:3,8 171:7 177:10

178:6 192:5 207:7

210:21 220:14 234:12

238:21 274:1 275:12
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

369

291:8 304:3 307:3,22

310:5 311:22 318:16

differentiate 307:20

differentiation 177:7

282:8,10

differently 78:19

274:18 291:15 319:13

difficult 8:4 27:14 33:8

72:7 84:11 96:9 99:16

100:9 162:18 171:17

227:22 228:14 259:10

272:17 274:10 282:16

313:11

difficulty 15:5 88:10

97:6 98:15 111:19

241:22 268:9,10

280:11

diligence 179:17

diligently 93:6

dire 304:13

direct 11:21 115:22

151:16 179:14 223:6

249:8 251:14 252:1,6

252:6 255:8,15

279:11 341:14

direction 72:12 200:4

240:20

directive 169:12,14

directly 24:12 136:7

253:5 310:7 320:8

Director 2:4,18 3:1,3,6

3:8,9,13,19

Director-Nonpublic 3:2

directs 139:8

dirty 314:14,22

disagree 25:12 45:22

129:1 159:17 195:6

210:6

disagrees 47:22

discharge 10:16 11:22

12:7,13,16 35:1 36:10

36:19 42:17 44:2

59:20 60:1 109:19

121:22 122:3 125:3

135:3 157:10 158:18

160:18 161:3,11

173:7 176:14 184:1,4

184:9,13 195:19

213:11 229:18 237:12

250:20 251:6 252:14

253:3 254:22 258:11

258:12 267:18 272:4

272:6,14 313:18

352:10 357:11 358:15

dischargeable 254:9

discharged 8:19 9:4

11:13 12:15 161:6

212:8,9 238:3 248:18

352:13

discharges 159:13

247:17 267:14

discharging 10:9 11:11

126:22 157:3,19

169:2,7 170:2 177:18

252:19 253:5

disciplinary 53:7

discourage 95:10

discourages 222:2

discouraging 95:14

discovery 54:8

discretion 8:16 180:8

284:8

discuss 57:4 76:5

78:10 126:10 170:14

170:17 311:9 325:8

325:19 326:1 351:13

discussed 5:21 326:14

discussing 79:8 152:17

153:10 292:8 306:1

discussion 20:12 24:1

32:22 49:8,16 57:9

74:21 77:1 80:11

98:20 116:21,22

117:3,19 137:14

142:15 149:20 152:13

153:2 154:14,18

155:6,8 168:12

170:11 184:6 198:13

199:13,19 200:3,14

207:8 214:20,22

249:13 268:1 277:13

289:3,4 297:3 298:7

317:16 322:8,21

325:6 327:8,20 337:9

346:7,13

discussions 20:19 21:2

57:13 84:3 175:7

288:16 307:20

dismiss 18:14

dispensing 67:14

disposition 14:9

disregard 48:6 55:8

298:4 306:9,12,15

disrespect 335:22

disservice 219:10

dissimilar 304:5

distance 80:16

distinct 44:18 123:16

235:4

distinction 36:12

156:19 157:12 204:17

205:7,15 251:3

273:14 308:11

distinctly 126:15

distinguished 328:17

340:4

distress 282:22 290:4

304:1 354:9

distressed 283:19

distributed 50:6 109:4

151:21 290:14 304:15

320:14

District 76:11

dive 28:10

division 2:6 341:8

divorce 169:6

DOBSON 2:4 119:21

120:5 128:8 135:10

167:20 178:5 205:18

241:21 250:7 257:5

311:20

doctor 334:19

Doctorate 328:22

document 32:3 108:18

150:13,18 151:1,3

156:7

documentary 225:4

documentation 156:12

156:12 158:2 165:20

227:20 232:7,19

242:21

documents 150:19

172:1,3,5,10,12

230:12 232:4

DOE 113:1

doing 64:22 71:8 90:7

94:20,22 100:10

108:16 116:20 117:10

155:13 184:3 195:11

196:14 199:5 209:13

249:9 299:10 313:22

323:9 350:9 352:19

dollar 278:7

dollars 60:2 170:3

286:1 304:11 351:18

door 286:22 337:15

doors 246:20

doubt 59:7,11 105:2,14

143:14

downward 15:12

Dr 324:12 328:10,11

329:19 332:15 335:8

339:19 340:1,5

draft 74:11

drafting 75:9 152:20

dramatically 160:7

draw 36:12 125:10

drawing 86:1

drawn 156:19

Drinker 3:21

drive 69:20

driving 89:19

drop 159:8

duck 312:5,6

due 23:6 65:1 89:11

125:22 126:6 159:20

179:17 183:5 191:11

191:13 194:8 200:9

200:12 210:5,10,15

210:21 229:3 230:7

231:14,22 234:19,20

235:2,12,17 237:15

238:12,14,19 239:2

240:22 241:6 244:4

245:7 246:8 248:13

256:1 257:17 258:21

260:21 311:7 329:22

Durbin 352:4

E

E 3:17

earlier 15:4 82:1 98:12

113:16 116:4 147:19

149:21 150:14 156:18

157:15 165:13 194:21

215:13 217:5 271:19

281:20 299:6 312:17

323:1 329:7 345:4

early 10:5 51:5,8 85:15

198:7,8

earn 111:5 136:13

earned 115:9 211:11

ease 187:14

easier 96:8 100:17

172:1 213:8 262:8

easily 180:13 187:9

217:11

easy 12:18 57:3 100:13

174:22 201:3

echo 81:3 100:19

236:14 239:22 243:15

271:18

echoed 274:11

echoes 115:6 304:22

echoing 141:14 166:13

308:22

economic 309:13

economics 329:1

335:17

economy 350:6

ed 59:5,5 80:16 116:14

Edfinancial 2:10

edge 318:7

edits 32:8

EDMC 353:3 354:15

educate 30:13 31:11,15

38:7 142:4

education 1:1 2:20 3:10

3:15 4:9,11,14,16

45:7 50:5 51:5,8

52:17 60:13 66:9,18

68:7,18 72:1 75:6
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

370

91:5 101:4,6 102:1,6

104:8,9 107:7 123:3,8

126:20 133:9,17

136:13 143:22 144:16

147:22 160:8 188:16

196:1 207:12 209:1

220:14 232:11 235:5

245:17 246:16 263:21

264:4 265:14 267:2

269:20 275:19 278:3

302:17 310:4 312:15

313:7 320:17 321:1

341:18 351:22 352:9

355:17 358:3,15

educational 53:14,14

87:4 136:7 144:1

145:13 201:18 310:9

effect 7:16 8:11 85:14

174:10 246:21 247:1

255:5 270:19

effective 6:3 39:6

effectively 163:20

279:8

efficiencies 13:17

efficiency 213:5

efficient 82:19 154:7

efficiently 11:3

effort 93:20 138:10

177:15 220:18 236:13

243:1 298:4 323:7

326:18 348:20

efforts 15:15 23:4 52:18

153:21

eight 41:13 42:5 45:3

117:2 123:1 143:7

eighth 143:8

Eileen 151:6

either 33:1 88:18

135:14 150:21 174:4

179:21 199:5 205:1

240:16 259:1 278:6

279:12 294:7,18

320:12 331:5

elaborate 296:9

elapsing 279:11

electronic 172:1,2

electronics 67:17

element 37:12 48:2

97:12

elementary 51:9,10

elements 34:14 38:1

56:11,19 88:16 174:2

194:1

elevating 96:9

eligibility 99:9 304:5

eligible 42:17 52:22

122:2,5 179:10 186:5

251:5 252:7 255:7

276:19,20 304:8,9

356:1

eliminate 200:12

ELLIS 2:5

eloquently 55:18

Emerita 328:12

Employers 353:11

employment 53:13 63:8

90:1 110:16 276:12

353:14

employs 52:21

enact 198:12

enacted 8:12

encapsulating 312:7

encountered 116:10

encourage 47:16

192:13 203:4 209:3

229:16 255:12 285:4

300:12

encouraged 171:20

207:13 322:1

encourages 192:11

encouraging 95:12

142:9 202:12

endeavor 29:9,19 30:4

ended 168:8 297:7

353:18

endowment 289:12

291:4

endowments 292:5,6

ends 331:8

enforce 39:20 155:20

enforcement 34:21

38:20 39:10 40:12,21

188:19 215:2,7,12

225:17 317:5

engage 41:1 59:9 203:6

265:2,15

engaged 40:12 59:8

340:18

enormous 160:20

168:11 169:3 286:4

enroll 40:7 41:21 90:6

133:1

enrolled 40:7

enrolling 184:11

enrollment 1:18 2:18

257:8

enrollments 283:16

enrolls 45:5 112:12

ensure 7:9 11:1 13:21

72:13 126:5 163:16

225:10 251:18 261:5

261:16 293:11 325:22

ensured 180:15

ensures 194:8 279:16

ensuring 60:12 91:21

251:12 261:22

enter 99:11 309:14

entire 104:4 326:16

entirely 190:5 191:6

235:7 351:22 358:16

entities 3:2 310:17

entitle 14:3

entitlement 276:16

282:16

entity 47:3 112:6,9

220:3 261:8

environment 64:13,16

201:18

envision 117:13

envisioning 163:7

204:8

equally 72:2 328:16

336:4

equations 180:20

equitability 180:19

equitable 175:11 233:3

equity 294:20 309:7

escrow 285:6

especially 106:1 110:17

144:5 168:7 178:12

178:18 211:9 238:17

245:17 248:14 253:21

268:7 289:4 296:17

328:19

essence 144:14

essentially 44:8 99:21

240:1 281:12 330:1

establish 97:17 175:14

180:14 195:1 274:14

277:3

established 9:15 60:18

establishes 267:3

et 54:9 155:15 192:12

194:8 222:15 270:5

301:12

evaluate 76:21 152:21

174:21 263:3 346:14

evaluated 10:7 347:20

evaluating 178:4

evaluation 9:11 10:22

128:16

Evan 2:2 75:21 80:5

Evangel 3:19

evening 322:2 359:1

evenly 264:16

events 284:4 298:12

299:2,14 301:3,7

Everest 110:17

everybody 67:4 68:7

71:9 72:13 114:3

118:13,15 119:5,6

120:18 124:8 149:8

219:10 306:10

everyone's 148:21

153:20 357:18

evidence 14:2 43:4,10

91:17 96:13 105:8,12

105:12,19 106:2,8

107:19 158:19 171:17

171:21 175:3 180:14

181:6 188:20 194:5

209:16,19 223:9,16

224:8,22 225:4,12,14

225:16,16,19 226:1,6

228:12 230:8,20

231:2,4,8,10 239:5,11

240:3,4,5,11,12 248:9

258:14 278:22 316:13

316:18 317:8

evidentiary 10:13 92:1

evil 18:18

exact 161:5

exactly 21:2 86:1

122:11 141:6 144:3

180:17 261:4 284:16

examination 99:10

examined 10:11

examiner's 112:8 113:2

examining 313:5

example 11:17 14:10

35:2 41:9 44:20 52:10

54:5 62:5 93:8 94:3

97:21 114:3 202:12

211:10 231:7 247:15

248:1 273:7 285:16

300:8

examples 49:22 54:15

58:12,16 59:2 73:21

231:1

exasperated 357:1,1

exceed 162:13 321:1

exceeding 320:19

exceeds 290:13

excellent 90:17

exception 75:17

excerpted 151:12

excessive 278:14

exchange 346:2

exclude 190:5

excluded 204:13

exclusively 231:9

excuse 226:7

Executive 2:18 3:1,12

exemplary 105:21

exercise 284:9 318:2

350:12

exhaust 207:9,12

208:13 217:16

exhausted 182:12

356:22

exhausting 222:4

exhaustion 192:18
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

371

214:20 222:20

exist 33:7 60:20 76:9

159:11 167:12 215:3

264:4 273:1 310:13

311:1,2 312:12

existed 184:16

existent 258:16

existing 12:22 14:1

15:16 179:20 180:4

258:10 283:9 301:8

exists 159:2 171:17

191:8 210:10 287:17

310:11 328:5

exit 251:8

expand 284:3

expect 15:11 62:7

158:12 160:1 168:14

276:6 326:3

expectation 169:16

expectations 175:6

180:14

expected 196:7 273:18

345:20

expediency 241:7

expedite 177:15,17

expediting 127:8

expended 196:1

expenses 145:14,15

224:18

expensive 66:5 222:10

experience 63:15 72:5

87:5 89:21 213:18

227:21 280:4 341:13

355:9 358:4,5

experienced 166:6

289:17

expert 185:3 336:12,15

expertise 326:1 337:13

351:19

experts 324:5 341:3

explain 329:17

explained 193:11 276:9

explanation 107:20

133:16 150:22 226:1

explicit 345:19

explicitly 81:11 99:14

explore 223:7

expose 59:22

exposing 168:10

exposure 160:20

168:17

express 15:14 181:4

extend 172:2

extended 12:5

extensive 188:3,4

210:14 346:7

extensively 86:19

extent 77:19 107:21

110:21 127:2 161:17

211:22 215:9 225:20

269:6 279:13 282:20

315:9

external 226:6 261:8

extra 93:20 143:21

extraordinarily 242:19

extraordinary 350:13

extremely 161:7 259:9

295:14 330:18 333:5

eye 22:4

EZ 113:1

F

face 142:3 193:17,22

201:12 260:1 310:22

330:13

faced 53:7

faces 247:8

facilitate 180:13 311:17

facilitated 126:21

facilitator 1:14,15,16

22:10 24:8 27:22

29:14 57:1 102:9

131:16 148:19 149:12

154:1 175:20 334:6

346:18 347:20 349:14

facilitator's 308:8 337:1

facilitators 1:12 5:8

28:5 30:17 152:17

153:7 155:13 347:4

facing 7:19 83:8 202:6

247:12

fact 20:21 30:9 36:20

45:9 62:14 72:20 89:8

91:8 103:16 115:8

124:14 127:9 143:13

158:5 159:6 163:8

169:14 177:22 181:8

238:12 271:22 273:1

304:22 309:7 325:7

329:19 338:9 339:8

345:20

factor 94:7 140:17

181:8 347:22

factors 92:14 135:22

facts 105:4,6,15 213:2

248:9

factual 151:11

faculty 47:4,14

FAFSA 276:21

fail 51:14

failing 273:11

fails 274:13

failures 342:16

fair 16:16 46:19 55:18

83:1 87:7 102:20

103:4,14,15,17,18,20

104:12 112:10 113:17

114:20 119:5 125:8

147:12 156:18 166:3

169:6,21 171:18

172:15,21 175:11

180:19 183:10,13

189:11 196:5 233:2

234:15 239:8,14,20

239:21 243:19 244:2

351:19

fairer 350:5

fairly 7:12 280:18

296:19 326:7

fairness 163:16 166:12

200:9 213:5 233:3

234:8 238:15,19

239:2 244:5,5 275:5

faith 16:18 17:9,15,19

18:19,20 19:1,9,17,18

20:2 21:18 101:5

153:5 298:4 350:3

fall 226:16

falling 303:17

falls 74:19

false 229:18 238:5,5

258:12

falsely 52:6

familiar 38:2 83:14 84:2

332:16,20

families 17:20 52:20

71:21 95:17 101:19

110:17 195:22 196:6

family 53:13 62:20

64:14 66:7 68:6,17

70:21 132:10 135:16

211:11 357:8

fantastic 338:1,2

far 68:18 93:18 94:8

131:10 171:16 182:9

191:21 217:1 228:11

272:9 313:4 326:21

326:22 329:17 331:8

341:1

FASB 270:22 272:20

288:20 305:10,18

325:14 338:19 341:20

342:6

fashion 8:17 223:6

302:11

fast 99:18 239:20,20

faster 140:7 184:14

father 17:11

favor 62:15 117:12

147:7 149:2 167:2

168:5,7 238:1 252:10

289:8 292:10

fear 135:17 147:10

299:1

fearsome 262:6

feasible 191:6

February 29:3

federal 1:14,15,16 3:6

3:20 4:15 38:1,5

50:10 60:18 61:15,17

61:21 76:6 77:2,9

81:12,13,16 82:21,21

82:22 85:10,21 86:14

92:2 93:13 97:13

107:3,8 108:2 109:19

113:1 146:6 148:6

163:8 164:11,22

177:2,14 218:11

249:7 310:11 336:19

354:16

federally 136:11

feedback 63:20 137:14

137:20 178:22 199:16

242:7 256:10 271:12

feel 20:16 28:4 33:1

67:21 87:15 89:15

142:1 186:19 215:19

281:5 322:13,18

329:18 338:12,16,19

354:20,21

feeling 135:4 287:2

feels 161:2 184:10

266:2 269:1

fees 125:17

fell 11:15 12:9

fellowships 343:3

felt 33:4 326:21 338:16

FFEL 11:18 12:21

251:14,19,22 252:11

252:13 253:5,11

254:20 255:6,9,14

fiction 191:14

field 355:9

fifth 176:8

fight 63:2 354:9

fighting 118:21 203:9

355:5

figure 47:8 93:21

214:14 222:11 318:2

file 201:1,16,20,21

202:13,14 351:5

filed 14:17 190:12

192:8 202:17 226:11

261:14

filing 201:22

fill 276:20

filling 32:5 183:18

final 85:5 151:9 214:13

255:19 298:14

finalize 321:20

finally 52:17 70:4

210:22 355:15
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

372

finance 2:14 3:17 125:4

Finance/Chief 2:17

finances 334:22

financial 1:3 2:4,7,17

2:18 3:2,13,19 60:14

112:5 113:3 141:20

142:10 168:3,12

247:9,10 260:2 263:8

263:10 266:22 267:3

268:15 269:19 270:6

270:22 272:16 273:8

273:9,11,16 278:19

280:14 281:17 282:1

283:11,15 288:21

289:18 291:8,9,13,16

291:22 292:8,15

293:8,22 295:8

296:19 299:4,22

301:4,15 302:18

303:10,22 305:4,6,8

307:16 311:2 318:5,9

324:4 326:13 330:2

336:18,18 337:7

338:18 339:15 340:14

340:15,16,20 341:1,3

341:4 342:13 350:1

354:8 356:1

financially 142:4

293:12 318:15

find 6:8 27:15 35:18

36:16 38:22 40:11

43:10 47:11 72:5,6

91:7 105:6 110:16

213:22 226:4 248:6

248:10 259:13 264:10

312:4 338:8 353:10

finder 89:8 103:17

finding 14:2 36:5 105:9

193:20 252:11

findings 35:10,11 50:15

151:11

finds 38:12 107:21

fine 55:13 132:12 208:1

247:19 266:5

finer 85:4

finger 116:14

firm 17:7 27:4 29:2

64:11,11,12 65:6

firmly 5:9

firms 65:2 220:10,10

233:9

first 27:6 39:8,17 43:19

43:20 49:4 59:1 62:5

62:18,20 79:21 94:17

96:3 102:3 119:12

120:6 121:1 123:3

126:7 135:7 136:17

153:15 155:11 159:20

175:18 176:6 182:9

186:8 189:17 200:7

214:12 235:13,19

237:22 269:5 270:10

275:20 287:2 301:11

307:11 309:9 328:8

332:14

fiscal 112:2

fit 30:20 223:6

five 158:3,4 162:7,19

165:3 167:15 243:4

244:8 266:16 318:6

332:17 340:9 343:8,8

343:10

fix 355:8

fixed 36:2

flagged 198:7 319:15

FLANIGAN 2:7 243:17

259:15 269:16,18

291:2 334:13 335:10

flavor 140:5

flawed 301:8

fleshing 87:22

flexibility 123:12

285:12

flexible 287:3

flies 142:3

floating 143:15

floor 20:5 30:19 31:1,22

32:17 69:19 77:3,9

156:2 229:17 230:17

231:19 324:1 349:19

Florida 354:6

flow 155:2 283:14

flows 293:19

focus 68:5 95:22

152:14,18 186:15

343:2

focused 8:2 293:18

focuses 294:6

focusing 153:16,16

163:8 174:9 184:6

folks 18:13 25:10 49:18

109:5 121:21 128:4

158:5 186:22 189:7

189:21 190:22 194:15

201:1 265:18 282:17

283:7 332:8 343:22

344:3,8

follow 16:7 26:10 29:16

58:7 99:16 117:16

130:3 175:13 177:14

186:15 188:12 194:22

197:14

following 15:22 167:3

229:14 248:6 266:11

314:6

for- 17:1 51:1 65:20,22

130:5

for-profit 18:17 50:10

65:18 66:22,22 95:10

95:15 98:18 116:8

118:10 122:17 124:5

191:5 295:7 341:18

341:19 350:19

for-profits 21:14 35:15

275:15

forbearance 197:6,8,11

197:18 198:18 199:1

199:8,20 200:7,18

201:2 203:18 204:2

204:21 205:19 211:1

211:17,19 212:2

213:14 214:1,8,9

253:16

forbearances 197:21

211:5

force 218:7 337:17

forced 90:21 307:15

351:8

forces 298:21

forcing 308:3

forefront 313:20

foresee 302:9

forget 57:3

forgetting 255:12

forgive 212:1 214:18

235:21 236:7 245:5

forgiven 14:16 206:5

246:13 250:15 316:5

forgiveness 207:3

251:13 254:12

forgiving 61:19

form 23:15 55:6 187:10

187:11 211:18 223:6

268:18 280:2 285:15

302:11 338:20

forma 283:14

formal 28:17 30:21 32:2

32:14 215:1,3,8

formalizing 299:18

formally 206:10 340:7

format 272:19

former 8:21 9:5,8,9

13:8 216:19 226:11

formerly 98:18

forms 256:16 285:5

formulation 85:14

forth 27:21 86:13

189:10 234:11 265:1

301:22 336:12 347:17

fortunate 106:4

forward 5:5,11 7:2 13:6

15:17,22 16:4 26:4

74:13 83:7 128:5

174:17 189:3 198:14

227:6 264:22 280:7

301:20 302:10 310:1

311:11 313:8 323:8

found 51:1,15 69:5

164:14 188:20 216:19

256:13 272:3 290:6

290:20 353:9

foundation 2:15 11:2

64:1

four 130:20 162:10

281:20

fourth 176:7

frame 83:21 131:3

133:7 134:20 139:2

141:12 146:11 152:13

165:4 243:10

framed 180:16 188:11

249:13

frames 131:21 175:8

240:10

framework 109:8

framing 179:10 180:12

frankly 96:21 118:19

310:15 350:8 351:7

fraud 33:19 46:1,4,5

55:12,14,15 56:10,12

56:16,18,19 57:14

62:4,10 88:16 106:1

200:13 221:1 222:7

238:10 246:16 307:2

308:6 318:16

fraudulent 47:21 215:6

307:17

FREDMAN 2:8

free 28:4 33:1 130:17

237:16

frequently 126:19

Friday 327:12

friends 70:14 357:2

frivolous 206:21 222:17

front 14:20 75:19

119:19,20 151:3

190:9,15 277:8 303:8

frozen 357:13

fruitful 154:19

frustrated 357:14

FSA 10:12 12:6,11

FTC 45:12 48:12 50:18

50:22 51:15 52:17

61:2 81:18 84:21

fulfill 33:17

full 14:2 80:3 88:1 89:1

93:4 101:1 103:14,15

103:17 104:2 106:9

106:11 109:19 115:18

120:17 124:20 125:5

128:3 134:4 162:10

162:11 167:11 204:14
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

373

281:17 289:4 304:2,5

327:8,14,20 329:8

331:18 332:1 334:2

352:20 357:21

fully 12:8 103:10

265:10 282:13,13

functionally 134:18

functioning 358:12

Fund 3:6

fundamental 172:16

238:15,19 239:2

257:16

funding 107:4 267:6

funds 58:2 170:7

245:16 267:22

funnel 54:11

furniture 69:18

further 139:18 170:17

206:18 262:21 284:15

284:15,17 295:20

322:9 323:15

furthering 311:5

future 30:15 208:17

293:7 311:15 317:22

318:3 319:22 325:11

351:13

futures 95:16

G

G 241:15

gainful 353:14

game 114:9 144:6

163:21 312:9 351:8

351:10

gaps 309:8,15

GARCIA 2:9 23:10,14

23:18 28:22 29:13

62:1 100:19 113:14

114:6 173:3,11,20

215:13 217:7 226:5

227:14 255:21 256:11

260:18 332:3

garnishment 108:15

gate 277:8

gather 15:9 58:12

202:19 209:19 227:11

230:7,15 274:21

gathered 327:2

gathering 181:5 194:5

217:2

general 1:20 2:2,3,5,6

4:12,13 27:7 44:16

64:3 77:20 79:7,16

84:4 105:18 178:2

188:19 204:20 210:8

339:8

general's 316:19

generalities 308:14

generally 60:22 86:8

149:15 251:16 254:4

326:3

generals 50:9

generation 62:5,19

301:12 307:12 309:9

generations 67:6

generically 294:11

gentleman 94:17

gentlemen 78:9

genuine 216:1

getting 7:22 56:11 70:8

72:7 94:10 95:22

132:7,14 140:13

150:11,12,12 178:22

236:10 252:13 266:13

285:10 310:2,9 323:2

323:3 327:4

GI 51:4 195:18,22

giant 188:3

give 6:21 13:10 35:2

49:22 63:19 65:10

102:12 107:8 118:4

129:22 130:17 131:1

132:3 133:4 135:11

136:2 138:18 149:7

149:18 150:4,17

154:1 188:21 193:3

193:14 219:11 231:1

231:6 234:9 238:22

239:1 247:22 259:19

281:14 285:11 300:17

314:2,3 318:3,13

346:11 348:22 357:21

given 9:22 13:3 33:11

35:18 41:10 83:7

86:18 127:9 135:4

224:15 232:21 256:6

261:15 282:21 299:2

gives 134:3 242:18

300:2

giving 42:6 85:16 101:1

129:13 132:20 168:18

238:18 346:9 359:3

glad 251:11 280:15

goal 239:14 292:18

325:17

goals 7:13 180:17

Goldstein 349:22 350:1

Goliath 62:13 113:21

118:21

goodness 135:7

gotten 72:10 87:19

156:22 226:19 317:17

govern 87:13

governed 86:8,18

government 2:2,12,20

3:5 60:8 82:21 92:2

118:22 119:4 144:7

160:21 179:22 208:5

208:15,22 306:17

351:6 354:19,20

governmental 112:6,8

gradation 281:1,2

282:7

gradations 281:4

graded 304:4

graduate 67:11,20

124:19 128:2 130:20

graduated 64:9 70:5

72:21 123:15,21

graduates 51:9,14

graduating 118:11

353:9 354:2 356:5

graduation 52:1 93:9

93:12 112:16 353:10

355:21

grandmother 67:7

grandparents 354:6

grandstanding 22:7

grant 121:5,11,14,15

123:13 242:1

granted 101:11 182:2

204:1 205:20 207:3

253:3 267:15

grants 353:16

greater 127:2 228:11

241:1 281:21

green 16:5

GREGORY 2:15

grew 326:11

grievance 207:10

208:14 351:5

grievances 248:1

grievous 307:2

grossly 136:1

ground 30:22 32:3

69:22,22 78:20

219:16

group 1:22 20:6,9 22:17

23:5 32:15 49:14 74:9

74:17 75:19 84:18

107:21 108:3 118:1

137:15,19 139:20

140:6 149:2,16

150:15,19 167:19

200:8,11,16 210:4,7,9

212:20,21 213:6,11

215:14 216:4 217:3

240:21 241:2,8,11,13

295:13 308:10 311:13

322:2 324:22 326:6

327:5 329:13 331:11

332:4 334:8,12

339:14,22 341:10

343:18 344:11 345:6

345:11 346:11 347:2

347:13,19 348:1

grouping 219:21

groups 135:4 137:14

188:16 189:2 325:3

350:4,4

Grove 69:12

growing 68:9 141:18

guarantee 119:6 179:22

197:19 240:11

guaranteed 224:16

240:10 356:5

guarantors 279:9

guess 65:19 128:8

130:4 131:4 140:12

162:18 172:19 203:20

230:10 237:18 251:8

252:22 309:1 328:7

343:20

guidance 299:13

Guidelines' 38:1

guilty 219:19

gum 90:19 91:1

gym 68:21 69:1

H

hackers 172:12

hacking 172:7

half 14:12 150:20 323:3

355:18

halfway 266:17

HALL 2:10 196:17

213:13 251:2 254:3

314:13

hand 18:14 28:21

152:18 153:3,16

189:3 221:11 332:6

handed 55:5

handle 9:15 19:2

262:18 268:14

handled 181:9 248:2

handout 223:20

hands 102:10 127:2

152:7 160:16 245:1

349:20

happen 30:2 71:9

107:12 144:19 145:3

247:20 250:22 254:5

280:15

happened 22:20 132:9

223:17,19 242:10

293:15 294:17 307:18

happening 21:17 262:1

275:1

happens 24:3 78:17

197:7 227:12 261:16

261:22 272:14 313:6

happy 5:18 25:2 78:9
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

374

249:22 282:2 322:7

322:14 329:10 336:14

harassed 354:3

harbor 37:19

harbors 38:19

hard 18:6 43:3 72:9,19

73:4 101:9 110:15

246:5 274:7 312:11

342:7

Harden 324:13 340:3,4

340:7 341:16 342:4

343:1,10

harder 110:19 118:14

harm 40:10,15 41:7

44:22 45:2,11 46:11

46:13,15 48:2 56:3,7

56:9,10 89:2 94:9

111:2 128:20 205:16

247:13 303:16

harmed 42:1,3,8 43:9,9

56:2 58:4 91:22

110:13 111:8 208:11

232:18 306:20

harming 40:20 41:5,6

Harrington 2:11 106:7

132:1 155:15 212:18

212:18 323:18 324:2

332:14 336:10,16

339:5,7

Harrison 212:4,17

haste 9:19

hate 78:4

HBCUs 275:14

HCM1 300:9

HCM2 281:3 304:1

HEA 13:1 137:7,22

138:19 139:5,12

142:7

head 138:5 181:12

headed 8:9

heads 102:12 131:2

health 3:11 54:12

101:20 281:17

hear 14:8 26:2 49:18

116:11 117:11,22

146:21 170:8,10

178:22 199:3,16

224:11 239:17 249:22

256:9 265:4 274:22

296:13 334:14 346:18

349:3,7

heard 49:19 82:9,12

114:5 146:13 162:7

176:17 206:1 238:15

244:8 248:22 289:10

304:22 306:7 309:1

326:13 330:7 343:22

350:17,17,18

hearing 27:8,8 89:10

121:4,10 123:12

125:10 150:1 189:8

190:20 194:11,12

296:1 350:10,11

351:2 358:19

hearings 21:16 73:19

108:15

Heather 354:13 355:2

heightened 280:20

286:11

held 47:19,20 55:15

57:5,20 58:1 156:6

206:3 272:5 275:6

311:3

help 7:1 43:13,14 51:9

58:18 71:16 76:18

83:2 115:17 116:9

135:16 152:19 153:17

187:4 242:11 253:20

255:1 260:3 278:20

helpful 6:9 83:18 84:19

88:3 97:1 109:1

146:20,21 154:20

155:12,19,21 165:21

173:13,18 175:8,19

192:16

helping 65:13 111:4,5

209:18

helps 222:21 262:18

hem 121:3,10

hems 298:20

Hero 247:17

Herzing 99:1,13

hesitate 187:15

hey 53:16 63:17 216:14

219:5

Hi 73:16 340:3 349:22

hiatus 13:15

high 10:3 66:7 68:21

69:14 122:20 124:7

214:5 241:3 290:19

309:11

higher 3:12,15 44:1

59:5,5 60:3,13 61:16

107:6 121:13 267:2

269:20 312:15 313:6

319:9

highest 356:1

highlight 161:22

hindsight's 319:2

hinting 294:5

hire 65:20,22 70:19

71:1,2 203:11

historically 179:15

300:22 301:13 302:8

328:13,20

history 8:8 171:9

179:12 276:12,12

302:15 319:12 328:17

340:19

hold 103:1 116:1

129:15,18 161:18

172:5,10 204:3

209:17 245:10 267:21

308:5 323:14 357:19

357:21

holder 61:2 235:6

holding 55:13 94:15

224:2

Holiday 1:10

home 22:8 51:4,20

67:16,18,22 70:9,11

294:21

homework 322:3

honest 22:9 65:3

100:15 207:21

honestly 144:9 262:10

HONG 4:12 38:17 39:9

39:14 73:16

honors 353:9

hook 148:12 302:22

304:12

hope 6:8 16:19 22:6

186:1,12 220:18

295:15 313:7 324:15

352:8

hopefully 7:1 39:17

86:15 106:3 243:17

272:9 295:18 308:10

327:18

hoping 296:3

horrible 350:22

horse 303:8

hot 295:15

hour 150:2

hours 153:19 354:4

house 67:17,19 70:9

160:6 161:1 310:1

housekeeping 30:8

323:12

Howard 2:1

HUBBARD 2:12 42:14

71:13 90:13,16

194:19 257:1 265:6,8

335:14

Hudson 2:13 115:2

167:6 176:5 180:22

181:11 236:13 262:3

262:21 271:18 289:8

304:18,21 313:10

328:1

huge 59:17 302:10

hundred 12:14,15

hundreds 14:10 285:22

hurting 118:10

hurts 55:15 209:6

Hypothetically 124:6

I

ID 191:4

idea 37:21 43:21 44:9

121:12,22 129:3

134:4 146:14 149:2

157:1 190:2 192:18

196:14 198:17 199:3

201:8 202:9 205:1

208:7 252:17,19

259:18 268:2,8,17,20

282:7 287:1,19,21,22

288:12 291:2 298:11

298:18 310:11

ideal 297:8

ideas 88:1 125:15 199:6

256:9 306:7

identifiable 257:13

identified 124:9 283:1,2

320:19

identifier 257:5

identifies 195:2

identify 12:11 35:4 90:4

174:19 277:9 289:21

311:13 313:15 320:9

identifying 311:21

ignoring 72:20 310:8

II 1:10

illegal 208:20,21

illegitimate 223:3

Illinois 353:3

illustrate 54:15

imagine 41:9 243:7

immediate 279:2

immediately 6:3 281:3

immigrants 62:6

imminent 13:12

immunity 118:20

impact 10:1 205:21

208:17 328:20 340:21

impacted 123:7

impacts 317:10

implement 10:8 11:20

198:8

implementation 198:4

198:7,9

implemented 141:20

implementing 15:18

implication 338:11

implications 9:22

338:18

implicit 91:15

implore 358:14

imply 179:20

importance 15:15

important 7:18,21 16:8
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

375

20:18,22 22:9 36:11

37:1 39:18 41:4 47:1

81:3 92:7 131:9

142:12 146:3 169:1

178:9 180:20 187:19

196:3 204:17 205:14

206:8 209:17 211:9

232:14 233:11 236:17

237:8,16 250:8

251:18 252:7 257:12

261:20 263:1 292:18

317:12 333:5,20

importantly 172:6

imposed 319:19

impossible 182:16

259:12,17 263:12

353:10

impossibly 98:3

impressive 330:18

improve 357:8

improved 15:18

improvements 13:16

inability 303:18

inadequacies 274:16

inadequate 8:5

inadvertent 232:16

inadvertently 97:19

inauguration 9:20

incentive 200:22

321:12

incentives 200:21

215:21,22 221:20,20

321:8

incentivizes 222:2

include 53:8 98:9

115:19 128:13 139:21

175:3 198:13 199:14

249:15 257:3

included 86:10 87:12

136:10 272:10

includes 184:11

including 6:2 10:3 32:6

51:3 56:15 81:12

108:14 139:21 199:20

255:8 335:17

income 211:11 309:9

incongruous 40:20

61:18

inconsistent 77:21

inconvenience 14:13

88:10 97:6 98:15

111:20

incorrect 42:6

increase 47:12 172:4

214:11 268:6 278:16

increased 283:21

314:21

increasing 102:5

incredibly 43:3

incur 237:11 269:6

315:10

incurred 143:21

independence 209:11

independent 86:12

160:12,16 190:17

independently 189:5

Indiana 51:20 52:3

indication 140:1 278:15

279:1

indicator 281:16

indicia 318:22 319:1,3

319:18

indictments 221:1

individual 15:6 39:11

74:2 122:22 154:6

162:21 188:13 209:14

226:20 228:3 230:6

237:3 241:4 263:2

316:8 328:9 345:21

individuals 27:12

153:13 200:17 324:3

324:19 327:2 328:2,7

328:7 343:22 344:1

345:21 346:4,14

induced 133:1

industries 118:17

industry 17:14 18:17

38:4 55:13 59:4 67:2

118:17 287:15 325:22

ineligible 12:13

inequities 274:16

inform 7:2 84:3

informal 182:22 192:10

information 7:1 10:13

20:19 26:17,19 29:9

29:12 32:13 42:6 43:6

53:15 54:3 79:21 85:6

87:20 92:16 93:6 94:3

94:4,11 95:6 101:14

108:20 109:7 126:3

128:9 173:9 181:20

182:4,6 188:18

190:15 202:19 208:20

210:1 216:22 217:2

226:17 227:3,4,11,12

228:9 233:14 244:20

257:7,8 259:14

274:21 277:2 298:5

314:2 330:17 348:8

349:14

informed 93:8

infraction 121:16

infrastructure 8:5 9:21

10:18

inherited 8:4,22 14:10

initial 74:11 190:5

327:18

initially 326:10

initials 228:8

initiate 188:16 189:1

initiated 263:20

initiating 264:6

injected 300:18

injunctive 205:2

injured 73:3

Inn 1:10

innocent 41:2 306:20

input 242:2,13

inside 341:19

insight 248:1

insignificant 174:15

insolvent 294:16

inspections 51:5

inspector 51:20

instance 39:8 195:4

215:4 218:14 316:12

instances 12:7 197:1

279:5 284:4

Institute 1:17 2:14 9:8

353:3 354:14,22

institution's 267:11

268:4 300:2,6

institutional 46:18

59:17 157:16 159:9

159:10 163:19 167:4

236:18 340:9

instructed 54:6

instructs 54:2

insufficiently 53:6

insulated 296:19

insulting 196:8

insurance 47:10 285:6

287:7 341:7

intake 10:15

Integrative 3:11

intellectually 293:14

intend 41:9,19

intense 7:5

intent 30:13 31:15

40:22 42:15 43:1,11

61:11 141:3 142:18

345:10

intention 17:16 220:22

345:4

intentional 38:11 42:2

56:5

intentionality 37:12

48:6 55:7 298:3

intentions 216:4

interest 7:12 14:15

117:1 135:19 142:19

142:21 159:5 173:19

192:7 204:4,14

205:21 206:2,4,15

207:3 212:1 235:12

238:8 239:19 245:7,9

253:14,16,22 293:11

296:9 297:10 310:12

interested 51:19 117:21

193:5 198:11 251:12

287:15 296:1 326:6

329:9

interesting 151:18

298:15

interests 22:15 25:16

49:17 57:6 163:22

164:20 189:9 194:13

232:12 235:17 310:7

310:14 313:5 317:3

317:22 354:20

Interim 3:10

intermediary 218:16

internal 12:17 192:18

207:10 208:14

internally 284:14

internet 31:7 247:16

interpret 26:3 185:18

291:10,12,15 331:12

interpretation 273:3,5

interprets 291:8

intimidate 263:19

intimidating 201:10

264:5

intimidation 256:16

introduce 149:18

324:15 328:2

introducing 339:20

introduction 324:20

intrusive 310:2

invest 102:6

investigate 209:2,19

investigating 34:6

245:1 317:7

investigation 54:13

188:18 202:18 248:4

316:19

investigations 226:7

320:12

investment 311:7

investors 260:15

301:18

invite 296:6

involve 160:14 244:12

involved 160:11 175:1

175:12 202:4 209:22

219:13 237:2 239:10

239:15 261:15,22

306:10,17 307:8

341:17

involvement 178:10

involves 160:19 226:7

IPEDs 93:13
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

376

issue 6:7 7:21 24:3

27:18 40:6 59:18 73:8

75:1 78:9,16 79:2

87:16 90:2 108:20

123:2 131:3,9,18

133:10 134:22 137:4

137:14,18 140:10,21

147:5 149:18 150:4

151:17 152:10,11,11

153:17 154:11,16,22

159:8 161:8 170:15

174:2,3,5,8 177:1

182:15,18 193:15

200:18,20 203:18

213:7 222:5 223:5,7,9

236:18 237:10,21

252:8 255:19 262:20

263:6 265:22 266:4

266:19,21 267:20

268:14,17 271:14

272:15,22 278:13

287:11 288:14 293:5

295:18 302:10 305:16

315:12 318:17 320:8

321:20 322:3 359:4

issues 7:19 27:21 28:2

32:17 35:11 63:14

64:1 65:14,14 68:3

76:22 112:2,9 117:2,6

117:22 118:2 151:10

151:15,15 152:10

153:2,10,22 198:20

201:19 202:1 221:11

257:21 266:18 268:5

277:18,20 278:10

288:19 289:4 291:22

306:1 308:1 310:5

322:13,18,19,22

323:3,11,12 325:21

326:2,21 329:9 330:4

330:8 333:19 340:10

340:11

issuing 14:6

it'll 265:6,8 277:22

item 87:16 103:3 198:7

249:5 250:2 295:19

296:17

items 85:3,5 199:14

200:3 231:10 292:20

295:13 334:10 346:21

348:5

iteration 184:21

ITT 9:9 126:22 294:19

318:20 355:16 356:3

356:5 358:10

IV 116:16 267:6 286:2

290:13 320:16,22

J

January 9:11 15:2 29:3

241:9,17 343:11

Jay 3:8 189:8

Jaye 197:13 254:15

317:18

jazz 193:8

JEFFREY 3:2

Jim 4:11 6:17

job 41:13,14,18 42:1,13

54:9 56:6 70:6 72:7

72:10,19 107:9

110:12,20,22 111:7

118:12 122:20 124:3

155:14 193:15 224:15

224:17 277:7 353:10

356:6

jobs 28:7 135:17

John 2:5 3:10 4:14 76:2

87:9 102:15 104:20

106:6 107:17 214:16

John's 107:20

JONATHAN 3:21

JONES 2:15

Joseline 2:9 23:9 24:2

28:21 61:22 100:17

100:18 107:16 113:13

138:3 173:1 214:16

219:18 221:18 223:12

255:20 260:16 261:13

332:2

JR 2:7 243:17 259:15

269:16,18 291:2

334:13 335:10

judge 160:1 183:3

194:7

judged 270:4

judges 121:4 190:19

judgment 154:5

judgments 226:8

JULIANA 2:8

Julianne 324:12 328:11

jump 53:17 74:14

131:20

jumping 154:3

juris 210:15

jurisprudence 80:7

262:17

justice 172:17

justification 158:15

K

Karen 3:12 315:6

317:18 320:3

Katie 246:20

Kay 2:18 57:1,10

keep 49:17 66:15 68:5

74:1 75:8,19 113:6,16

114:19 120:2,3

124:21 125:5 127:4

129:7,14,17 130:1

133:9 134:5,10,14

141:8 153:1 154:7,20

156:5,9 158:2 171:6

172:2 186:18 190:3

200:19 204:6 211:20

268:12 270:10 288:4

288:8,13 291:7

292:18 335:14 337:6

345:10

keeping 66:13 129:20

198:11 277:8 326:6

349:15,16

Kelli 2:13 107:16 115:1

166:22 167:19 176:4

180:22 233:17 236:12

261:11 262:19 271:16

274:11 280:12 289:6

304:16 313:9 327:22

Kelli's 178:1,17

kept 11:9 148:19

kid 68:21

kids 54:9

KIMBERLY 1:18

kinds 33:20 168:13

278:9 280:9 288:18

330:11

knew 346:3

knowing 67:21 313:16

327:6

knowledge 128:11

216:16 355:9

known 48:8,13

KOLOTOS 4:14

L

label 279:7

labels 119:11

Labor 218:12,15

Lacey 2:16 24:11 34:3

34:12 43:19 58:22

85:8 96:16 120:22

143:5 156:17 189:15

229:14 239:17 257:16

283:6 298:10 342:1

343:20 344:18

lack 9:13,16 289:19

338:22

lacking 240:9

laid 241:16

lane 181:3,4,5 233:22

lanes 234:6

language 27:10 101:15

139:16 141:1 142:9

152:20 165:15 187:13

249:13,17 288:9

311:15

large 17:1 64:11 76:8

76:20 78:15 81:10

141:16 316:15

largely 76:13 97:12

151:5 197:15 340:11

LARSON 2:16

late 11:12 85:15 124:11

Laughter 303:14

304:20 308:21 335:11

337:4 340:6 342:3

359:5

law 2:1,4,4 3:13,18 8:15

17:7,7 33:19 60:21

61:3,8,13 64:10,10

76:3,9,20 77:8 78:7

79:11 81:12,17 84:8

84:10,16 85:12,17,21

86:6,8,18,19,20 87:13

91:13,18 95:2 105:19

121:3 160:1 183:3

188:19 190:19 194:7

203:8 220:9,10

225:12 233:9,11

267:17

laws 15:6 61:8 76:12,13

79:13 80:7,9,21 81:4

81:9,10 83:14,16

84:17 85:19 86:1 98:7

98:8 105:16 158:8

215:10,10

lawsuits 320:12 321:9

lawyer 64:21 82:5 106:5

220:9 238:20 261:3

lawyer-ese 63:1

lawyered 56:12

lawyers 201:13 202:6

203:11 234:13

layer 311:18

lazy 101:8

lead 38:13 197:4 209:3

274:16

leadership 10:7

leads 46:10

leaf 28:9

lean 241:5

learn 52:14 54:4 353:6

learned 160:5 312:16

learning 3:12 312:20

313:3 353:7

leases 305:6

leave 42:10 62:16 68:15

120:19 234:13 252:1

286:22 348:3

leaving 154:17 293:4

led 355:10

left 17:11,20 127:13

153:22 176:1 191:12
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

377

249:2 250:1 266:1

325:6

leg 264:18

legal 2:8 10:13 47:3

63:10 65:13 79:10

103:6 108:18 151:5

182:12 187:2,14

188:1,4,4,7 209:15

211:3 253:4 351:18

351:18

legislation 233:5

legitimate 222:6,8,21

223:2 254:8 262:13

264:19

lenders 197:19

lending 2:12 151:7

276:11 277:6 330:3

length 135:20 162:12

345:22

lengthy 222:10

lesson 293:20

let's 28:10 49:12 65:3

71:4 89:4 90:18

102:22 111:11 119:5

119:5,8,12,13 122:15

122:16,21 150:2

171:6 172:2 194:16

196:13 219:5 231:12

239:1 254:9 276:6,10

326:15 330:9

letter 268:19 280:3

283:10 285:3,21

290:9,15 297:13

319:20

letters 168:13 287:1

296:22 297:10 301:2

301:16 302:1 319:9

letting 148:20 216:18

level 10:3 59:13 94:9

226:20 303:22

leverage 215:2

LEWIS 2:18 57:11

liabilities 159:10 260:8

263:1 268:10 294:10

liability 94:12 157:11

159:9 163:19 167:4

168:11 191:21 205:13

236:20,22 237:10

238:4,7 263:8,11

269:6 273:21 274:8

282:21 293:6 297:21

298:9 306:11,14

315:10,14,16

liable 148:2,8 235:14

245:10 267:21 272:5

275:7 290:6,21

Liberty 3:14

license 51:11,15 99:10

licensing 51:22 52:1,4

99:9

licensure 104:11

lie 41:19

lied 51:17 354:17

life 107:6,7 196:8

355:18,19 357:8

358:2,4,6

lifetime 164:12,15

166:15

lifted 148:14

light 30:9 158:20

248:14 283:4

lights 69:17

likelihood 268:6 278:16

290:5,21

limbo 356:18

limit 74:1 166:2,2

191:22 194:14 221:10

267:9 277:5 282:4,18

282:19 290:8 304:10

347:14

limitation 162:8

limitations 12:10

145:22 146:4,7 147:5

147:7,9,14 148:4,10

154:14 155:4 156:2

156:11 157:6,12,17

157:22 158:6,12

159:15 162:6,14,19

163:6,9,13 164:8

166:8 167:9,12 168:6

168:9,10 169:9

170:12,18,22 171:2,8

171:12 172:16 174:1

limited 20:12 95:21

132:11 276:18 281:6

288:15 346:20 355:10

limiting 278:5 304:2

limits 164:12,16

Linda 3:13 17:7 31:6

37:3 38:17 49:13

54:19 62:17 77:12

86:21 88:14 100:18

102:14 167:1 179:8

181:14 192:6 194:11

200:4 210:2 214:16

217:14 218:1 221:16

237:13 239:22 257:14

258:18 259:16 297:15

315:11 321:5 334:3

335:20

Linda's 212:20

line 45:18 96:3 106:10

125:10

lines 31:6 37:22 284:5

294:4 300:8 356:21

link 84:21

linked 166:20 289:17

linking 158:15

liquidity 293:18

list 50:8 194:11 275:14

298:12 299:14 320:14

324:9 349:6 353:8

listen 22:2 305:22

listening 20:3 74:20

176:12 256:8 296:12

307:5 330:6

listing 298:11

lists 50:11,15 197:20

literacy 141:21 142:10

literature 328:5

litigating 63:9

litigation 2:3 103:7

321:14

litigators 96:22

little 15:2 21:16 49:21

50:17 55:3,4 63:20

68:3 75:16 87:21 88:2

91:12 94:15 95:8

96:19 107:15 117:11

117:16 119:1 123:15

149:21 154:21 171:22

195:12 212:19 214:19

218:4 238:4 247:22

251:2 296:1 303:8

308:16,22 309:1

314:15,21 318:1

319:17 328:15 329:17

329:21 337:12 346:17

live 69:11 73:4 196:11

220:2 246:14

lives 102:7 352:21

356:19 357:19,21

358:17

LLC 2:4

LLP 2:16 3:21

loan 11:18 60:9,22 61:4

61:18 87:5 121:21

122:3,8 135:3,13,21

137:3,10 140:19

141:17 143:22 164:16

167:11 179:12,13,14

179:18 195:19 201:2

211:13 212:9,13

235:6 238:3,11

247:16,17 249:8,11

249:11,15,18 250:11

251:15 252:6 254:20

255:8,9,16 258:11

275:21,22 276:3,22

294:8 304:9 330:8

355:22

loans 10:10 11:13,21

11:22 12:3,7,8,12,13

14:15 36:19 40:8

42:11 43:9 60:2 61:12

61:15,17 82:22

101:18 104:14 108:2

108:5 109:19 110:2,9

115:20 120:11 123:9

125:3,20 130:10,18

132:4 135:15,16

136:4 142:5,19

143:19 144:7,10,14

145:3,6,14,16 147:8

148:1,6,12,15 161:4,6

167:16 169:2,7 170:4

179:16 185:16 186:5

206:2 211:21 212:8

235:21 236:8 245:6

246:13 249:7,7,19

250:10,14 251:13,17

251:19 252:12,13,18

252:18 253:12 254:6

254:7,8 255:15

267:18,19 272:6

276:4 279:7,7 282:21

316:4 353:17,18,21

354:3,7

locale 99:11

located 78:20

location 191:16,17

lodged 286:9

Lodriguez 3:5 263:15

300:16

long 11:3 13:16 14:8,14

15:14 19:11 75:14

98:19 114:13,15

119:22 148:11 155:5

166:4 168:8 206:3,16

207:2 242:16,19

275:18 285:10 337:5

358:17

longer 11:14 54:1 122:5

165:5 172:5,9,11

206:18 249:19 250:20

311:1

look 5:11 15:17,22 22:4

55:10 69:10 80:1

83:22 103:10 112:9

125:17,20 131:10

135:1 139:22 150:18

151:7 152:21 164:17

169:2 171:11 174:17

174:19 177:20 179:17

210:7 220:3 221:1

227:5 241:15 248:9

260:6 261:4 270:19

275:5,14,15 290:16

291:21 293:17 294:4

303:21 305:17 311:14

312:8,18,19 314:20

318:18 321:7,8,11
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

378

323:8 330:4 331:3,12

looked 10:15 70:12

76:15 226:18 269:22

270:4 282:3 284:22

looking 5:5 26:11 30:14

37:13 81:15,18 82:7

82:15 83:5 85:6 88:16

92:13 94:12 95:3

98:17 102:19 126:16

131:12 134:13 135:2

137:13 139:16 141:22

165:11 171:22 174:6

180:18 220:8 237:19

238:2 251:3 255:18

256:20 261:2 264:16

265:16 270:5,7,17,17

270:21 271:2,4 275:8

277:2 280:8 287:16

288:18,20 296:11,15

305:4,7 311:10,22

319:4,11 322:18

331:1

looks 138:15 241:9

315:3 353:12

lose 307:12

loss 53:8 255:1

lot 5:7 16:13,15 37:14

45:17 62:3 63:22 64:2

64:20 68:10 73:2 80:7

82:5 98:7 101:16

114:21 116:7 118:3

127:7 138:9 141:19

144:12 150:1 152:9

158:7 161:3 162:10

170:6 171:7 176:21

188:2 196:21 200:21

218:11 219:2,3,3

224:9 227:8,17 236:2

241:15 262:6 263:19

282:10 283:7 313:4

319:8 320:15 321:13

339:17 350:10,11,17

350:18,18 351:2,9

352:7 354:10 355:12

356:11,12 358:12

lots 321:10

Louisiana 64:4,12

66:10 118:21

low 309:9 318:8

lower 169:8 253:13,22

309:19 312:22

LS&T 267:9

LSU 119:4

luck 16:1

lumped 118:13

lunch 152:17 154:13

M

M 3:3

machinations 160:13

mad 219:5 222:8

MADZELAN 2:19 23:21

60:7 74:18 115:16

179:9 247:7 275:18

279:15

main 176:13 235:18

major 257:10

majority 176:18 186:19

213:22 226:17

maker 270:15

making 14:20 24:15

26:12 36:8,9 64:2

65:14 79:15 80:5 87:7

90:5 96:8 113:18

154:6 161:4,9,11

169:9 204:10,18

209:9 211:20 215:21

218:17 230:4,4

244:13 269:13 270:14

310:6,7 323:19 327:7

331:19,22 333:21

344:5,7

Malveaux 324:12

328:10,11 329:19

332:15 335:8 339:19

340:1,5

manage 28:7 47:9

303:19

managed 194:7 218:14

management 1:19

157:16 341:5,7

manager 33:14

managerial 10:12

managers 46:19 59:17

managing 281:13

manipulation 294:14

manner 82:19

Manning 4:11 6:17,18

7:3 226:15 250:21

Manning's 348:11,18

manually 9:18 12:6

maps 310:3

market 294:21 308:4

319:6

marketing 52:11,18

marriage 17:12

married 158:9

marrying 160:14

MARTINDALE 2:21

80:4 91:11 145:19

162:4

martyrdom 350:18

Maryland 3:11

Massachusetts 9:9

massive 62:11 113:22

145:6

master's 332:5,12

match 234:11

material 48:11 52:11

157:13 274:5,6

materiality 46:13 48:2

274:4

materials 41:10 52:11

223:21,22

matter 44:16 73:10

75:15,17 79:10 85:8

150:6 169:6 171:20

180:12 228:16 232:9

259:11 266:10 295:4

342:22 359:7

matters 171:3 321:17

MCCOMIS 3:1

mean 24:12,14,17 25:2

25:11,17 31:10 34:3

34:18 35:3,8 39:21

43:21 44:20 45:6,10

45:12 48:5 54:14 59:3

63:1 68:22 71:14,17

72:15 85:9 91:15

92:12,19 93:10 110:7

114:2 121:1 122:9

123:20 124:14 125:7

132:20 133:19 134:1

138:6 148:7 169:20

171:2,8,10 172:15,17

176:9 182:7 192:17

196:18 197:7 201:14

213:14,19 218:9,11

218:19 219:14 220:6

220:8,9 221:20,22

222:15 228:14 229:19

230:1,5,13 235:18

239:8,17 241:20

246:19 262:8 283:12

294:17 298:10 299:9

299:15 300:5 302:19

303:7 309:13 314:17

314:22 320:14 329:20

335:22 342:4 344:2

meaning 45:22 128:13

204:1

meaningful 309:17

meaningless 127:6

means 60:14,14 61:2,6

110:8 129:14 206:20

244:22

meant 65:7,8,9 97:20

measure 88:12 134:15

216:18

measures 33:20 77:19

304:6

measuring 312:14

313:3

MECHANICK 3:2

mechanism 125:9

134:13 192:7

mechanisms 262:17

313:20

media 19:7,12,13,22

20:1,17 74:4

mediation 1:14,15,16

218:13,14 248:8

medicine 67:14

meet 39:7 51:2 65:20

65:22,22 184:10,18

192:21 207:13 267:5

303:19 327:12,13,16

meeting 152:22 297:13

meetings 29:3 138:13

333:10,13,16

meets 224:13 233:21

member 92:21 190:9

323:19 333:9 336:11

members 20:7,11 22:14

22:15 23:13 25:17,18

52:19 151:5 159:21

160:8,22 161:9,15,18

326:4 343:17 347:2,3

348:1

MENDITTO 3:3

mental 101:20

mention 177:6 200:6,7

mentioned 33:4 82:8

102:3 113:15 136:5

138:4 141:15 143:5

154:10 165:8 176:20

178:7 217:14 226:15

233:7 243:15 267:7

280:1 287:6 289:11

310:10 320:11 343:7

merely 31:11

merit 11:10 201:2 248:7

meritorious 225:3

merits 7:21 161:10

193:21 346:15

mesmerized 293:16

met 1:10 67:7 248:7

276:7 287:14 327:3

methods 308:11

metric 127:18 269:12

280:13 290:16

metrics 180:21 270:3

293:17

mic 16:3 170:9 243:22

335:13

Michael 1:17 28:10 33:2

70:13 71:10 77:11

88:5 89:14 90:10,16

97:3 98:12 136:20

170:9 178:15 179:7

180:10 189:8 222:13

227:15 233:16 236:14
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

379

241:19 244:15 247:22

257:15 259:5,16

271:17 279:20 287:11

289:6,14 294:5

302:13 325:1 337:19

347:5

Michale 3:1 135:8

middle 68:16,22 70:11

146:19 149:6 219:16

mike 1:20 33:7 62:17

63:12,17 64:17 71:14

72:17 118:2 172:22

178:21 203:14 214:16

218:1 221:9 246:7

mikes 63:18

military 52:19,21,22

71:19,20 195:15,18

195:22 196:6

Miller 1:12,16 135:6

136:20 141:13 143:17

145:18 146:8 155:7

155:22 156:3,16

million 50:14

millions 170:3 307:8

351:17

mind 7:13 34:17 74:1

75:8 94:21 103:1

105:4,14 107:20

113:6 120:15 127:4

148:22 152:14 153:1

156:10 171:6 172:2

186:18 200:19 217:4

266:18 268:13 270:10

288:5,8,13 292:18

322:6 335:17 354:20

minded 200:20

mindful 49:15 268:5

minds 75:20

mine 132:1 141:14

minimally 229:9

minimize 322:22

minimum 228:17 241:6

349:9

minor 60:9 117:8

minorities 307:11

minority 263:16 309:10

318:10

minority- 324:9

minority-serving

300:20 328:21

minute 73:6 96:18

116:1 266:7

minutes 330:7 348:4

359:3

mire 134:8

mirror 227:19

mischaracterizations

31:7

mischaracterize 315:22

misconduct 110:9

188:21 316:14,20

317:7,8,8,10

misinformation 224:15

mislead 40:14

misleading 50:20

100:11

misled 104:10 110:2

186:20

misread 41:10,12

misrep 120:10

misrepresentation

31:13 33:5,6 34:7

35:6,19 36:21,22 39:5

39:8,20 40:4,5,13,18

42:8 44:3 49:21 50:4

50:16 56:4 58:11,14

59:3,12 61:10 74:22

76:7,16 83:22 86:11

109:21 110:6 123:19

125:18 126:9 130:11

166:7 176:15,22

177:7,11,13 178:20

179:6 182:5 215:6

228:22 229:1 250:12

250:13 252:21 318:16

misrepresentations

36:17 44:15,16 54:18

116:9 133:2 224:10

224:12,20

misrepresented 136:16

167:15

misrepresenting 272:3

missed 281:22 293:1

mission 297:12

misstated 143:13

mistake 17:6 36:9

37:16 38:11 41:4

45:10 46:6,10,16 48:1

98:5 131:16 207:21

232:16 237:3,6

306:20

mistakenly 195:17

mistakes 36:15 37:19

38:13 41:2 47:7 57:21

59:6

misunderstanding

207:22

MIT 329:1 335:18

mitigate 14:13 55:11

56:3,9 62:4,10,22

88:20

mitigating 200:15

mitigation 56:20 63:11

mix 222:9 223:3 344:9

modeled 81:11

moderators 109:16

MOHELA 3:20

Moines 1:19

Moira 1:11,15 32:17

71:13 146:9 194:19

mom 67:7 353:22 354:9

moment 116:19 259:22

momentum 15:9

money 65:3 106:17

107:8 111:5 130:1

132:14 136:2 140:18

142:2 144:1 213:21

219:2 276:11 281:14

303:1 304:14 306:17

350:13

monitor 38:6

monitoring 280:20

month 69:20

months 160:5 281:20

294:16

morning 5:3,16 6:11

7:3 16:8,14 18:22

71:12 73:17 82:2,8

94:14,14,17 142:17

176:17 200:14 206:1

217:1 226:15 250:21

320:15 322:4,8,15

344:14 359:4

Morris 330:10

mortar 80:15

mother 62:21

mother's 17:12

motivation 17:4

motives 22:15 23:12

24:21 25:16 221:8

move 7:2 28:12 57:1,9

70:6 74:13 100:22

106:12 140:10 141:9

199:18 200:4 223:8

240:20 255:20 264:22

280:19 281:14 291:12

314:12 356:20 358:17

moved 28:2 67:19

moves 236:1

moving 13:6 32:1 174:3

301:20 302:10 313:8

334:5

moxie 263:19

MSIs 302:4

multiple 12:2 92:15

94:2 154:16,16

159:18 162:1 185:5

MURRAY 3:5 263:16

265:12,19 300:17

343:7 345:15

mystery 309:6

myth 195:20

N

naive 222:22

naively 17:13

name 90:11 111:10

129:16 155:18,19

256:5 257:3 258:16

259:19 263:2 339:17

340:3

name's 303:4

names 32:5 155:12

261:15 264:22

NASSIRIAN 3:6 293:1

nation 309:8 312:14

national 3:4,15,18

84:15 275:20 309:4

nationally 51:13

naturally 155:2

nature 33:21

Navient 354:3

navigate 246:6

navigated 187:9

near 302:11

nearly 42:17 353:9

neat 68:20

necessarily 36:18

45:11 48:7 110:7

148:7 195:6 231:5

232:8 248:16 329:16

348:21

necessary 10:2 145:13

163:16 212:22 217:20

265:14 285:16 355:1

necessitate 311:17

need 29:9 31:18 43:14

48:10 54:9 56:18

57:15 59:10 64:21

65:6,16 66:19 67:2

74:9 85:22 87:16 95:7

104:18 106:19 116:21

116:21 117:4 136:9

136:10 142:14 144:4

144:10 145:12 152:14

152:17 156:9,14

163:3 170:13 172:14

181:16 187:6,8

190:22 191:11,13

198:12 199:3 206:22

209:22,22 214:6,14

220:13 221:4 225:18

232:1 236:11 237:7

241:8 249:16 263:9

266:2 267:5 271:9,10

272:11 275:7,10

277:20 284:3 305:1

310:21 314:12 326:18

332:9

needed 11:1,19 32:9

144:15 325:22

needing 250:3
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

380

needs 30:1 36:2 48:16

56:7,8,9 57:19 65:17

67:3 104:15 234:10

237:2,4 239:9 264:14

271:20 272:7 273:14

280:14 284:17 285:11

285:13 291:5 298:17

303:11 308:4 314:21

342:5

nefarious 172:13

negative 19:13,22

208:17

negotiate 17:15,19

152:21 153:5

negotiated 1:3,10 5:17

7:6 80:12 351:13

352:7,19 357:15

negotiating 18:7,19

negotiation 74:12

negotiations 20:2,14

25:11 29:5 292:10

negotiator 4:15 24:21

25:7 34:10 140:4

350:7

negotiators 16:21

24:16 50:7 152:3

159:7

Negro 3:5

neighborhood 69:11,12

69:21 70:7

nephew 67:15

net 306:19

network 356:4

never 107:10 114:5

147:11 243:6 265:2

265:11 270:7 351:16

353:13 358:6

nevertheless 77:7

new 7:16 8:10 28:9,9

49:17 54:22 55:1,1

67:19 70:7 111:10

128:17 130:12 144:11

158:21 194:17 198:11

210:13 249:11,18

252:6 270:7 272:20

305:4 325:13 342:6

352:3

news 5:8

newspaper 246:15

nexus 48:16 200:13

nice 222:18 266:8 298:7

niece 67:14

night 15:10 16:14

322:11

nights 203:9

Nino 355:15 356:2,8

nobody's 297:1

nod 127:11

nodding 181:12

nominations 339:12

non 222:21

non- 66:3 98:18 191:5

214:8,9 294:9

non-attorneys 96:21

non-career 10:6

non-federal 159:6

279:7

non-intentional 39:4

non-negative 279:17

non-profit 122:18 124:7

130:6

non-profits 35:15

nonprofit 295:8

North 1:18

notably 342:16

note 12:19 16:20 29:15

57:1 73:18 75:4 80:10

85:13 91:19 92:7

102:9 146:3 149:11

149:12 153:4 175:21

195:2 233:12 266:15

324:18 329:7 337:1

348:13

notes 52:18

notice 81:1 151:8 234:4

238:13 239:4,10

245:13 336:20

noticed 18:4 339:11

notification 231:14

232:5 234:9,14,19,21

237:8 256:1

notified 197:8 207:14

256:4 260:10

notify 192:19 193:13

214:3 244:5

notifying 194:5

noting 85:6 100:12

149:14 153:22 200:3

321:16

notion 48:12 126:13

127:5 238:14

notwithstanding 79:5

110:22

November 1:8 320:6

nows 150:1

nuances 206:22

number 5:17 13:11

15:12 49:8 74:14 85:5

87:17 93:18 102:9

111:15 137:4 150:5

170:15 174:3,13,16

177:2 178:3 187:4

197:5 204:22 248:21

249:3 255:19 274:7

277:22 279:22 290:2

290:12 296:5,7,17

316:15 332:19 340:13

341:3 342:14

numbers 32:10 102:11

349:21

numerous 135:22

349:5

O

O'CONNELL 3:8 197:14

254:16

objection 346:19

objectives 20:13

obligation 63:6

observation 131:5

obtain 127:13

obvious 239:7

obviously 80:6 125:20

256:19 271:21 321:21

332:11 344:12,15

occasion 281:18

occur 49:4 128:18

224:10 271:8 299:14

299:19 327:9

occurred 48:22 58:5

74:20 123:6 138:3,14

305:11

occurring 28:20

occurs 48:18 122:13

OCHINKO 3:9 49:20

53:18,21 54:2 98:11

99:20 116:3 178:16

179:2 292:4 302:14

320:2

OCR 243:3

Off-microphone 82:3

offenses 86:17

offer 40:1 86:15 107:20

122:20 124:16 142:19

186:3 314:10,11

345:20 346:4,8

offered 51:1 158:17

office 2:3,6 3:19 4:12

4:13,14,15 9:1 112:8

190:20 202:11

officer 2:10,17 3:11,20

33:15

Officers 3:4

offices 348:15 352:4

official 123:12 125:10

133:12 157:9

officials 121:4,10

offset 268:21 287:22

oftentimes 228:2

301:11

old 83:4 270:5 355:6

older 253:11 328:16

oldest 328:13

olds 276:11

omission 79:13 122:13

122:22 124:11

once 11:10 15:8 69:20

171:16 194:3 212:13

213:9 344:7 345:1

ones 65:21 111:11

164:11 180:18 224:11

226:12 250:19 318:19

319:10 322:19

online 52:12 78:11,20

172:10 184:20

onus 96:11

OPE 191:4

open 17:18 20:5,16

30:22 31:21 32:17,20

49:9,12 85:1 154:9

165:4,5 172:12

176:11 178:7,21

181:4 183:2 200:19

218:11 231:19 234:3

250:3 256:10 286:22

287:19 288:3 295:19

324:1 337:6,10,15

341:9 344:10 347:18

349:19 358:10

opened 353:13

opening 20:6 156:1

280:9

operate 11:3 78:14

80:17 83:16

operating 78:11

operation 294:16

operational 10:11

opinions 117:22 153:10

237:18

opportunities 91:6

145:4 231:7,17

327:15

opportunity 31:3 48:20

49:3 63:15 77:15 98:4

121:5 137:1 140:17

178:10 195:7 203:3

207:16 209:3 219:12

228:11 229:3,4 231:3

232:6,15,18,21 233:6

234:3,5,10,15 236:6

239:5,11 240:10

249:6 251:19 278:8

280:10 281:15 282:4

326:15 336:8,12

346:10,12 357:20

oppose 146:21

opposed 22:7 149:6

181:10 192:17 200:17

251:14 282:5 330:9

344:7

opposite 230:22

opposition 146:14
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

381

opt 145:3,15 199:6,7,21

199:22 203:19,19,22

204:6,12 211:15

217:13 257:3

option 13:5 68:15

121:11 183:22 195:9

196:12 257:3 337:6

options 145:2

oral 99:5 224:11,20

order 11:21 30:1 49:11

82:18 102:4 128:20

130:18 136:3 201:16

225:1 231:22 253:2

255:16 267:5 293:2

organically 198:16

organization 191:7,8

191:18 192:2 309:4

351:9

organizations 153:14

220:11,12 350:5

origin 251:17

original 122:8 219:21

ostensibly 193:21

ought 48:19 49:1,2 77:6

124:13 237:20 319:11

outcome 171:19 186:10

188:9 235:14 258:6

299:21

outcomes 279:17

outdated 355:7

outlandish 98:2

outline 183:12 227:7

outlined 291:18

outlook 23:3

outreach 95:3 216:22

outside 12:9 43:14 59:5

174:6 218:20 342:11

outstanding 12:3 28:3

138:7,21 183:16

overall 20:13 60:12

312:14

overcome 123:19

overlap 178:19 179:5

271:7

overload 147:10

overly 78:16 91:22

overnight 322:9 346:13

oversight 340:10

overview 6:22 84:17

owe 160:10 211:13

owed 135:3 169:11

P

P-R-O-C-E-E-D-I-N-G-S

5:1

p.m 150:8 359:8

paced 322:17

package 198:14

packet 41:11

page 98:20 100:7 228:6

pages 98:19 100:8

paid 17:7 65:3 113:12

117:18 135:2,5 136:6

136:19 137:9 138:22

139:14 142:21 143:19

146:1,15 149:3

252:10,12

pain 54:11

painful 80:13

paint 231:5

PALMUCCI 3:10

panel 30:13 31:11,15

paper 72:20 137:4

150:5 152:11 154:11

174:3,8 177:2 236:19

263:6 278:13 323:2

348:22

papers 108:20 151:16

151:17 152:10 153:17

154:16 288:14 296:14

305:17 359:4

paradigm 204:18 238:5

238:6

parallel 281:9

parameters 173:14

parents 62:6 69:21

parity 253:8

parroting 37:5

parse 250:10 308:15

parsed 207:1

part 8:1 13:1 18:5 23:21

24:6 25:2 40:22 44:12

46:16 47:21 53:10

55:9 58:2 60:11 74:3

75:9 76:9,20 81:10

94:7,8 95:12 97:16

103:12 117:6 120:4

122:22 124:3 137:8

138:12 139:12 142:2

142:15 160:9 161:1

197:21 198:11,14

199:4,15 203:13

209:14 214:21 215:4

223:20 250:22 252:22

272:13 283:19,20

292:15,17 293:1

311:6,8 332:10 338:9

338:21 344:18

partial 88:1 89:1 101:2

101:21 103:18,21

104:3 110:8 117:12

119:14 120:6,16

121:1,5 125:14

126:13 127:16,21,21

128:7,15 132:2

133:21 134:12,16

143:3 352:20 357:22

partially 12:9

participate 190:13

267:5 272:8

participates 116:16

participating 7:5

293:11 320:16 341:4

participation 267:11

particular 15:7 85:19

89:5 99:10 103:12

104:11 125:21 137:11

139:4,12 156:13

165:15 203:21 204:19

230:19 247:11 253:19

325:5 331:7 338:6,13

340:20 347:10

particularly 7:7 23:6

163:17 207:19 257:20

309:12 320:13

parties 87:7 160:16

171:14 175:1,11

183:5,8,11 192:20

193:14 210:12,16,21

213:10 234:16 239:9

239:15 240:3 266:14

331:20 344:16

Partner 2:16 3:17,21

parts 39:1 119:13

332:18

party 17:3 190:16,17

242:14 245:21 259:1

pass 273:8 294:13

passed 17:11 151:4

passion 95:20

path 154:21 198:16

204:7 251:12 252:1

255:16 288:8 358:3

paths 310:1

pathway 271:20

pattern 54:16

pay 42:11 65:5 66:16

130:18 136:3 142:5

144:14 204:5 237:20

238:10 278:1,6 281:2

payback 58:2

paying 60:4 66:14

138:9 278:2

payment 52:22 252:20

payments 145:5 211:21

pays 267:19

peers 216:19

Pell 164:14,16 304:8

penalized 270:4

penalty 225:9 286:4,16

pending 7:14 8:3 13:7

14:19 15:12 82:9 83:4

205:4 231:16 256:2,5

256:18

Penn 343:4

penning 229:22

Pennsylvania 341:6

342:21

people's 23:8

peoples' 357:19

percent 13:8 41:13,14

41:18 42:5 45:3,4

46:21 47:6 97:20,20

129:8 178:19 179:5

290:13 304:7 320:20

percentage 214:5

290:18

percentages 281:1

290:12

performed 15:2 314:18

performing 314:19

period 36:7 69:13 156:7

158:1 160:7 165:10

166:9 173:12,17,17

174:14 240:4

perjury 225:9

Perkins 11:18 12:21

275:21

permit 125:10 255:14

permitted 105:13

permitting 240:20

Perry 2:13 115:2 167:6

176:5 180:22 181:11

236:13 262:3,21

271:18 289:8 304:18

304:21 313:10 328:1

persistent 309:7,15

person 18:22 29:22

62:20 67:19 69:2 73:2

88:17,20 124:9

209:13 229:7 230:15

238:10 257:22 336:6

338:7 347:17

personal 16:12,20

17:10 18:5 53:15

172:8,11

personally 29:7 333:11

perspective 30:8 39:11

39:13 41:17 62:2

77:14 95:8 97:10

128:9 130:5,7 146:22

167:21 176:22 177:8

196:21 236:18 237:9

273:4 283:3 297:5

300:19 308:8 309:2

perspectives 27:19

80:3 260:19 357:18

359:2

persuasion 91:14,16

pertain 21:9 120:13

pertains 194:21 195:15

341:14
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

382

PETERSON 3:12

317:20

petition 176:14 323:19

petitions 347:2

pharmacy 67:10,11,13

philosophically 191:9

philosophy 122:6

Phoenix 354:15

phone 32:10

physical 101:20

physically 73:3

piece 72:20 139:14

198:2 206:8 250:8

317:13

pieces 230:19

piling 131:13

pipeline 185:7 310:9

pit 190:3 232:9

pits 163:22

pitted 164:4 187:21

190:6

pitting 188:4

place 8:5 9:21 29:5 49:5

100:22 114:17 126:5

136:17 142:8,11

161:3,13 184:15,15

205:3 210:11 216:11

216:14 232:1 246:22

297:19 307:21 311:8

312:15,20 313:20

314:7

placed 286:16

placeholder 297:20

placement 35:12 41:13

41:14,18 97:19

126:21 224:15 257:9

places 62:12

placing 113:6

plain 187:13 353:6

plan 30:17 254:12

291:19

planning 140:1

play 107:15 171:7

209:18 210:17 235:17

playbook 54:12

player 114:7,8

playing 55:4

plays 260:5,10

please 16:4 32:10,12

33:1 49:13 73:7 74:15

111:13 151:1 175:22

176:4 221:16 266:7

288:13 314:10 330:21

347:3 359:2

pleased 183:8

pledge 301:2

plus 44:3 82:12,13,19

92:21

pointed 36:4 55:18

108:14 122:9 139:17

153:2 347:7

pointing 127:17

points 18:3 19:7,8 21:7

25:14 27:18 38:8

39:17 53:2 54:4 64:2

73:8 82:1 87:20 117:8

151:13,17 189:17

207:7 218:3 236:2

245:3 292:10 321:21

350:12

police 106:19

policies 9:14 47:11

62:9 166:18

policing 106:14,15

107:9

policy 3:3,5,6 60:12

165:14 172:15 192:7

229:22 325:13 332:5

332:8,12 340:8 343:2

343:5

political 159:22 160:13

190:18 343:1

politicizing 78:16

Polytechnic 2:14

ponder 128:5

poor 62:21 350:21

351:1

population 310:8

populations 309:10

portion 75:10 211:8

277:15

posed 6:12 117:17

position 25:6 113:11

161:11 217:15 244:19

289:21 301:15,17

330:20

positions 17:4

positive 23:3 33:11

338:2

possible 20:20 27:5

29:10 43:14 83:15

160:13,16 168:17

173:15 189:16 190:18

265:7 288:1 297:20

316:22 329:4 347:4

358:16

possibly 125:17 130:5

142:9 144:6 287:4

289:13

post 29:20 286:15

posted 30:2

posting 268:17 269:9

279:14 280:1 298:13

348:19 349:9

postsecondary 4:14,16

188:6

potential 14:1 52:21

86:6 221:5 257:4

263:11 273:21 274:8

317:11

potentially 34:19 35:21

72:21,22 121:14

130:20 134:11 142:19

151:18 160:14 162:7

162:18 172:12 177:15

194:4 195:7 196:8

280:8 283:19 290:3

296:21 305:7 314:6

352:19

power 216:16 225:5

299:8 357:11,11

powerful 71:14

powers 119:3

practical 90:18 108:9

133:16 168:16,20

169:5

practically 78:10

practice 37:15 61:6

64:10 76:17 83:6

99:12 132:21 207:19

practiced 108:16

practices 10:15 11:4

40:12 45:14 76:13

81:7,19 85:18 98:8

311:4,7

pragmatically 220:3

pre-qualification

254:17

precarious 301:14

precedent 80:8 161:13

precedential 161:12,19

precipitous 234:2

278:20 281:19 289:16

290:22 293:16

precipitously 205:9,11

precursor 222:10

predation 95:10

predatory 151:7 207:20

208:2,20

prefer 39:2 240:16

preferable 284:12

preference 34:12

149:16 251:21

preliminary 13:3

premiums 47:10

prepared 73:8 128:11

174:18 277:18

prepares 74:10

preponderance 31:12

91:17 96:13 105:8,19

106:8 107:18

prerogative 80:18

346:18

present 1:13 4:9 171:20

239:5,11 240:3,4

284:9 340:22 344:2,4

presented 151:17

236:21 344:1

president 1:18,20 2:7,9

2:10,11,12,13,15,16

2:19 3:5,10,12,16

64:3 113:10 328:11

328:18 334:14,16

presiding 1:12

press 18:10,12 24:14

24:15 45:19

pressing 94:21

pressure 54:4 159:22

169:3 170:7 208:13

pressures 307:16 311:2

presumably 249:16

presumption 91:5

109:18 211:16

presumptuous 329:21

pretty 54:14,17,17

59:22 96:6 158:4

178:18 179:4 239:7

283:8 314:13

prevent 278:20

previous 8:18 9:3 57:13

138:12 174:9 184:21

290:14

previously 108:21

138:22 140:22 174:13

191:9 287:22 301:8

price 279:17

prices 277:22

Principal 2:5

principles 210:17 325:9

331:7 339:3

print 52:11

prior 28:20 91:15

143:19 147:2 196:1,2

232:20 285:16 286:7

294:2 327:13 343:11

344:17

privacy 172:8,9 215:10

private 35:14 60:22

61:12,18 65:6 66:21

101:18 112:6 122:18

124:6 130:6 172:11

218:20 238:17 279:7

300:21,22 301:13

302:8 341:13,17,18

354:16

privates 275:13

pro 188:5 283:14

proactive 216:17 317:6

probability 263:14

probable 263:5

probably 26:22 27:2

105:18 115:11 143:14
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

383

156:14 176:21 195:12

206:19 216:10 219:1

230:18 241:15 243:6

243:11 270:1 273:9

275:11 283:21 284:11

312:2 322:5,10

334:16

probative 158:19

problem 40:16 55:8

57:3 141:17 162:5,15

212:19 213:7 299:4

problematic 125:2

161:7 162:2 298:19

302:6,7

problems 33:13,16 71:7

294:12 295:1 301:18

301:19,20

procedural 155:8 203:8

245:15

procedure 207:10

261:7

procedures 9:14 10:8

proceed 149:17 300:9

proceeding 34:6 44:7

157:14 179:14 235:13

235:16

proceedings 21:22

22:1 108:13 235:3

processed 211:7

253:19

processes 10:9 11:5,20

15:3 29:22 135:20

187:20 201:17 202:10

205:1 237:7 258:10

258:16

processing 201:22

226:20

produce 124:15

produced 1:21

product 130:1 287:12

288:4

productive 5:6,11

27:17 57:9 73:17

153:18

products 285:7 287:7

profession 99:12

professional 16:9

104:11

professionals 65:20

71:2

professions 67:9

professor 242:5,8

profit 51:2 65:21 66:1

98:19 130:6 191:6

294:10

profits 17:2 66:4

program 7:15 8:10 9:12

10:3,7 11:2 12:17

13:14 35:4,9,17 36:4

37:9,22 38:6,12 39:6

44:6,11 51:8,21 52:16

60:9 99:1,3,6 104:4,7

104:8,18 109:20

110:3,5 111:1,2,4

112:13,13,14,19

123:2 124:12 125:18

125:21 126:8,11

128:17 131:8 132:22

133:3 136:15,16

164:12,16 166:5

249:8 251:14,15

253:6 275:21,22

276:3,9,16,19 283:15

298:2 314:17,19

315:1,4 319:6

programmatic 10:19

99:2,4

programs 10:11 51:1,4

72:6 120:13 141:21

142:10 162:9,10

218:12 267:12

progress 6:13 14:20

20:13 266:9 349:8

project 151:6 340:19

projects 340:13

promise 15:10 30:5

75:5,15 84:8

promised 149:13

354:18

promises 11:8,9

promissory 75:4

promote 24:19

promulgated 320:6

proof 30:14 31:8,12

42:15 56:19 61:10

87:22 89:7 96:10,20

104:22 105:2 230:2

proper 9:16 191:18

232:6

properly 8:6 142:5

proposal 19:21 20:5

22:11 40:22 133:5

proposals 79:22 321:22

344:21

propose 19:10 177:12

275:1 335:15 345:3

proposed 87:2 151:8

192:17 234:20 277:11

277:12 344:20 346:14

346:15

prosecute 171:18

prosper 102:4

protect 41:1 70:18

144:22 145:17 210:11

296:8 297:10 306:22

307:6 310:20 311:6

313:13 314:16 317:2

317:22

protected 261:6,18,21

262:11 319:21

protecting 81:4 92:1

232:12 317:13,13

protection 60:21 61:7,8

61:13 91:18 105:16

105:18 158:7 171:13

311:18

protections 171:15

191:12 210:11

protective 61:20

protects 7:11

protocol 22:22 23:1

32:3 338:9

protocols 9:14 20:9

23:5,22 25:13 28:15

28:18 32:13,14

284:14 336:11,17

343:15

prove 43:3,11 88:17

91:2,8 96:9 123:18

128:2 224:3 262:9

provide 53:20 76:14

77:2 84:7,9 86:17

93:6 95:17 110:16

133:13 136:12 137:20

150:18 156:12 173:5

178:11 187:2 189:1

210:15 217:5 223:10

225:22 231:4,15

232:7,19 236:15

240:11 243:14 251:22

252:11 253:7 257:7

258:14 273:19,22

283:13 285:12 307:2

308:10 313:2 324:20

328:3 346:22 354:22

provided 1:22 14:3

92:17 95:5 108:21

123:3 231:17 241:10

257:9 344:13

provider 127:3

provides 76:3,21 77:8

82:16

providing 40:16 83:19

94:6 190:15 211:4

229:12 233:13 242:21

274:9 325:14

proving 97:9

provision 75:3,14,16

139:5 259:1

provisions 198:3

proxy 126:16 127:18

prudence 210:15

public 3:5 18:12 24:14

24:15 26:15 35:14

60:12 66:7,7,10,12,13

66:15,21 68:21,22

73:19 74:3,5 118:19

122:18 187:10,11

188:3 192:7 208:18

296:18 308:2 323:14

332:5,12 333:7

334:12 339:9,10

341:13 343:2,4 346:2

346:22 348:4,4,12

349:17,19 358:18

publishing 93:11

Puerto 76:11 82:13

pull 198:21 357:5

pulls 286:2

purchase 90:22 91:3,9

purpose 171:11 307:15

307:17 342:14

purposes 34:4,5,11

37:11 44:11 52:3

pursuant 194:8

pursue 35:1 279:19

356:3

pursuing 207:11 269:2

288:9

pushing 196:14

put 21:19 26:17 32:12

37:12 47:13 62:1

70:17 75:18 79:22

85:4 89:9 90:11 95:7

103:5 107:1 108:19

112:10 114:8 119:15

124:1 140:4 142:10

151:17 161:9 173:9

185:10 189:13 206:9

215:16 216:3 227:2

254:9 289:13 291:3

300:9 301:17,22

304:11 307:9,21

313:20 314:6

puts 46:21 47:6 96:11

106:13 290:2,3

297:12

putting 78:12 99:21

100:14 160:15 189:10

190:8 205:1 256:14

280:7 286:5 300:13

309:1

pyramid 72:15,18

Q

quadfurcation 233:20

qualifications 309:13

qualified 67:12 336:4

355:10

qualify 51:14

quality 123:7 124:7

quantifiable 56:7
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

384

quantify 274:10

quasi 205:2

quasi- 291:3

quelling 295:15

question 29:15 33:3

36:3 49:10 58:8,15

74:14,15 94:16 96:3

104:6 105:1 115:16

115:22 117:16 119:14

120:20 123:6,14

127:14 128:1 133:7

134:20,22 137:22

138:1 139:4,11 140:3

140:12 154:11 159:16

165:7 170:22 173:3

175:22 179:10 180:9

181:1 185:10,13

186:14,15 188:11

194:21 197:16 199:15

199:20 212:7 214:7

214:14 216:7 217:3,5

226:5 231:12,12,13

248:21 249:1 250:9

256:3 260:13 262:5

269:18 270:2 279:12

291:6 308:9 311:12

311:16 323:18 325:1

325:2 332:3 335:15

341:11 343:20

questions 6:12,21

27:20 53:12 74:8,10

85:3 87:15 96:1

116:20 152:18,19

153:3,16 173:22

174:6 176:9 212:5

221:10 266:1,16

269:3 271:10,15

288:15 295:20 311:11

311:11 324:22 329:10

334:7 335:20 341:10

343:13,14 346:1

348:4,17

quick 20:8 25:14 27:3

28:11 29:19 30:5 32:8

39:17 59:1,1 73:18

128:22 140:8 145:20

146:15,18 181:19

189:16 205:5 217:8

242:20 244:11 265:9

325:2 348:9

quickest 26:21

quickly 11:13 26:18,21

71:11 114:2 119:22

143:5 178:17 179:2

242:8,21 255:22

262:4 294:15 328:1

346:21 347:4 348:6

quiet 208:19

quieting 209:4

quite 21:6,8,9 118:19

131:6 142:17 238:5

262:10 296:2 313:1

350:8 351:7

quo 8:14

quote 354:1,4,7,11,12

354:17,21 355:2,16

356:6,7

quoted 151:13 353:18

quotes 352:2

R

raid 90:1

raise 35:18 60:16 61:3

73:21 75:1 147:19

189:3 260:13 277:22

322:14 332:5

raised 15:5 23:7 58:8

79:2 92:9 119:14

137:18 138:14 140:22

153:7,12 185:13

194:15 209:10 210:2

270:5 295:8 323:18

raises 123:5 252:8

ramifications 204:14

ramp 251:8

ran 332:17 353:21

rapidly 268:7

rarely 223:15

rate 41:13,15,18 97:19

212:12 253:14,22

276:14

rates 35:12 93:9,12,16

224:16 257:9 304:7

309:11

rating 260:6

ratio 273:9,11 294:1,6

294:14 320:20

rationales 151:11

ratios 269:20,22 270:1

272:18 305:1 318:6,9

335:1 342:9

Rawles 3:13,13 16:5

17:7 21:11,13 22:19

37:4 38:22 39:12

54:20 62:18 78:2

86:22 88:15 102:17

168:1 181:16 182:8

200:6 221:17 237:15

258:19 297:17 321:7

335:21 337:11

re-litigating 350:11

reach 193:4 216:12

290:2 334:7

reached 303:22

reaching 256:17

reaction 117:9

reactions 296:14

read 20:9 22:13 41:14

103:3 352:2

readily 59:14 131:15

173:9

reading 99:17 137:3

ready 63:13 199:15

250:5

reaffirm 23:22 28:14

reaffirmation 23:22

real 20:20 47:14 125:8

128:22 176:13 265:1

299:1,1

realistic 170:1 220:20

221:4

realities 83:8

reality 113:19

realize 111:22 168:20

263:22

realized 276:2

realizes 222:14

reason 37:1 136:11

137:8 148:13 161:2

182:16 187:18 191:9

241:14 258:1 264:20

271:22 312:10 325:5

reasonable 37:20 47:18

48:3,9 88:17,19 94:11

97:18 98:2,6 128:19

158:3 236:1 290:7

327:4

reasonably 37:20 88:20

90:9

reasons 103:6 125:8

126:17 159:18 162:1

168:21 176:13 182:1

225:1 226:3 250:22

313:11,18 321:10

Reath 3:21

reauthorization 142:7

rebuttal 178:11

rebuttling 53:6,10

recalculating 288:18

recalculation 298:16

recall 27:16 254:16

294:19 337:2

recalled 354:2

receive 101:3,6,22

104:11 115:5 133:20

227:17 259:9 267:6

received 50:21 130:9

133:11 188:18 228:9

receives 193:13

receiving 129:4 197:20

224:7

recess 266:12

recipient 164:14

reckless 48:6 55:8

298:3

recognize 13:19 38:5

83:3 94:1 155:19

162:14

recognized 52:3,7

recognizes 14:7

recommend 145:6

159:7 257:2 345:13

recommendation

230:11 270:11 314:4

344:19

recommendations

325:11,18 327:7,9

332:1 333:2,22 334:1

334:2

recommit 23:5

recommitment 23:1

record 28:15 73:11 74:4

85:10 149:11 150:7

155:13,21 162:17,20

164:18 165:9,14,18

166:2,17 167:3 224:1

266:11 272:13 345:18

359:8

recorded 28:20 263:10

recording 1:22 5:20 6:4

20:22 24:2 26:9,12,15

28:13,19 29:4,21

30:10

records 225:16

recoup 148:3 245:11

recoupment 235:9,10

316:3,12

recover 58:1 60:4

133:19 137:2 139:1

140:18 157:5 169:3

169:13,17 170:7

recovered 161:6 173:6

recovery 59:21 157:20

160:19 178:13 267:21

274:15

recruiter 41:10,16 42:3

42:4 224:13,14 228:3

recruiters 51:16

recruiting 41:12 54:10

54:11

recruitment 223:21

redefined 270:1

redirect 221:14

redress 88:18 103:14

103:18,21

reduce 63:6

reduced 278:7

refer 267:9 288:14

reference 73:22 152:2

155:17

referenced 142:17

250:21
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

385

referencing 85:20

151:22

referred 51:16 150:13

referring 108:17 141:10

refers 25:15

reflect 342:6

Reform 350:2

refrain 22:14 25:15

refraining 23:11

refund 143:19

refunded 136:6 303:1

refunding 135:1 149:3

refunds 115:19 117:17

131:20 136:19 137:9

146:14 148:1 252:9

252:14

reg 38:20 46:12 85:14

regard 33:19 59:2 97:2

128:9,21 157:2,4,10

157:20 159:12 161:5

161:10 190:21 192:4

203:17,21 229:5

279:21 284:20 290:10

293:4 341:12

regarding 28:3 34:7

108:13 117:17 154:13

348:18

regardless 39:9 119:9

143:12 146:5 220:16

regards 212:7 250:18

regional 64:12 310:13

regionally 51:11

Register 336:19

regs 145:22 197:17

202:21 293:18 299:13

regular 310:16

regularly 64:6 191:15

regulate 116:5 139:8

regulated 268:16

regulating 198:2

regulation 15:18 33:12

34:2 37:11 38:14

75:11 113:2 140:13

140:14 185:19 206:10

232:2 240:2 277:3

284:18 302:12

regulations 8:12 15:17

33:6 65:17,21 66:1,2

66:4 70:18 74:11

107:11 139:6,13

174:10 179:13 198:12

241:10 251:22 255:4

255:13 267:13 283:9

284:4 285:1 286:22

299:12 307:21 340:15

342:10

regulators 201:21

regulatory 8:14 64:13

64:15 106:16 191:3

284:10

Reich 3:13 58:6,7

102:14 104:1 119:18

125:14,15 135:8

141:13,14 155:9,10

155:15 156:3,4 165:1

165:2 166:21 167:2

181:14 183:14,15

185:8 241:18 242:22

243:1 253:9,10

reimbursement 269:7

304:1 315:10

reinvent 76:19

reiterate 247:7 299:7

reiterating 166:19

rejection 28:17

relate 87:4 114:2

176:19 271:3 301:4

305:18

related 14:19 70:20

101:13 109:20 110:9

136:8 143:22 174:12

226:13 291:22 326:5

340:13,15 343:4

relates 76:1 115:12

272:21 274:8 328:4

relating 35:11 48:2

177:10 316:16

Relations 2:20

relationship 134:14

264:3 265:13,19

relationships 82:20

released 26:15 29:4

relevant 21:6,9 40:6

151:19 209:19 215:6

215:10,11 259:13

278:11

reliance 44:4 94:11

97:12,18 98:1,5,9

relied 42:7

relief 8:17 12:13 14:4

40:1,18 43:13 46:2

57:17 60:19 61:11,15

61:16 81:17 82:16

83:19 86:6,13,18 87:1

88:1,13 100:21 101:1

101:2,21 106:10,11

109:18 110:4,8,8

111:17 115:5,18

117:12,14 119:14

120:9,13,16,17 121:1

121:5,12,14 123:9,13

125:14 126:13 127:16

127:21,21 128:7,15

132:2,4,11 133:21

134:4,12,16 136:5

137:10 138:4 139:18

142:19 143:1,8

147:21 148:5 185:14

185:21 186:6,8,10

188:14,16 189:1

209:8 210:9 235:4

236:11 251:20 252:1

252:7 255:17 274:14

315:15 317:12 352:12

352:20,20 357:21,22

relies 211:11

relieve 143:16

relieved 58:4 104:13

115:11

religion 104:7,14

religious 318:10

reluctance 121:14

rely 90:9 99:5

remain 10:19 40:7

243:6 250:8 329:9

remainder 6:2 32:15

remaining 152:11

remains 8:2

remarks 5:14 73:15,20

74:2 91:15 348:11,18

remedies 182:13

192:18 222:4,20

remember 33:10 54:7

58:9 79:20 87:3 92:15

106:20 142:13 199:2

320:4,7 321:4 346:13

remind 102:18 126:18

249:8,10 288:10

reminder 74:9

remnant 54:11

remove 214:4

removed 67:2 212:11

212:15

Rensselaer 2:14

reopen 30:19 322:8

repaid 115:20 135:16

137:2 140:18 142:2

146:6 167:11,16

repay 75:5,15 135:14

144:7,13 148:1

repaying 268:10

repayment 61:4 135:13

139:14 140:15,20

206:7 242:2 303:2

repayments 276:3

repeat 152:16 179:3

222:3 243:2,18 246:4

258:19 288:12

repercussions 135:18

repetitive 194:13

reply 265:12

report 84:16 215:5,11

330:3 332:18 345:12

352:3

reported 270:13 281:20

299:15

reporting 197:1 242:18

283:10,18 284:6,17

286:11 305:6,8

331:17

reports 332:19

REPP 3:15

represent 17:1 24:17

26:7 37:14 57:7 66:3

92:19 153:14 221:3

333:18 347:13

representation 36:8

40:9 99:14 338:13

339:14 347:8

representative 59:16

241:13 331:15 333:12

339:2

representatives 84:4

350:19

represented 25:10

124:11 187:8 324:8,8

325:4 333:8 347:14

347:15

representing 46:18

55:20 62:15 263:16

264:12 309:4 324:7

340:11

represents 24:21 35:19

47:17 48:3

reputable 353:11

reputation 124:8 247:3

247:19,19 264:2

268:2,4

reputational 238:7

247:9,12 260:1

request 16:4 109:15

133:12 155:9 173:4

173:10 199:8,18

210:22 215:17 216:3

216:21 243:3 248:3

348:10

requested 339:12

requests 213:16 215:14

348:8,14,14 349:11

349:14,15,15

require 46:12 61:10

103:21 128:20 269:9

279:14 283:9 285:20

302:18

required 10:18 92:17

93:7 158:2 162:20

207:9,12 223:10

230:20 231:10

requirement 165:9

208:13

requirements 11:20

51:3,22 99:8 144:16
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

386

164:18 224:2 231:14

267:8 272:21 286:12

290:15

requires 51:11 239:4,4

requiring 187:13 189:2

285:15 286:14

rescinded 87:3

research 3:9 340:19

reserved 345:7

reserves 287:21 291:3

reservists 195:21

resist 300:13

resolution 182:22

192:10 214:13

resolve 182:15,18

193:6,15 195:8

resolved 151:10 152:2

resounding 135:11

resource 6:10

resourced 309:20

resources 3:16 5:10

62:11 101:15 106:18

106:21,22 114:11

118:22 119:1 136:12

136:15 164:22 213:9

217:16,20 294:9,15

316:11 326:9 355:1

respect 11:6 21:20 22:3

22:12 27:11,12 40:21

65:1 110:3,5 159:20

178:18 179:4 235:13

260:21 329:22

respected 22:17 122:18

respectful 149:13

358:20

respond 21:11 60:7

118:7 159:16 166:22

178:17 198:6 229:7

231:18 232:6,18

234:5,15 236:3 240:7

258:14 261:12,18

274:19 286:19

respondent 233:10

responding 102:11,12

182:8 192:3 233:8

234:12

response 59:16 84:13

111:14 115:22 128:1

134:21 212:19 248:5

257:1 278:4 286:21

responses 178:1

232:10 234:12 249:1

responsibilities 9:10

194:6

responsibility 1:3

106:14,15 168:3,13

230:6 266:22 267:4

268:15 269:20 272:16

273:8,11,17 278:19

280:14 283:11 292:1

292:9 293:9 300:1

305:1 324:5 326:14

336:18 337:7 339:15

340:16,16,20

responsible 2:12 47:20

99:7 135:13 156:6

273:9

responsibly 205:8

responsive 151:14

rest 55:15 66:9 334:10

339:18

restate 27:8 196:17

345:4

restating 24:13

restored 132:15 135:12

restrictive 60:20

result 7:10 46:15 60:17

75:5 254:21 262:15

results 145:9

resume 110:19 124:2,4

129:16 353:12 358:8

resumed 73:11 150:7

266:11

retaliated 262:14

retaliation 259:1,2

262:5

retention 162:17,20

164:18 165:9,14,18

166:2,18 167:3 224:1

return 33:1 228:4

retweet 19:22 21:19

24:19

retweeting 18:9,13,17

21:14,22 24:13

revealing 158:19

revenue 320:22

reverting 153:15

review 9:13 10:16,17,19

11:10 13:22 35:5,10

36:4 37:9 44:6 80:20

232:12 236:4 240:5

271:8 314:20 359:3

reviewing 10:9

reviews 35:17 36:14

44:11 314:17 315:2

319:7

revise 251:21

revisit 87:2 174:4

271:13 291:19 326:16

revisiting 288:17

rich 139:9,19

Rico 76:12 82:13

rid 71:5,8 119:8

rigged 351:7,10

rights 95:2 124:21

191:19,22 194:6

202:12 208:10 237:17

245:15

riots 69:15

rise 85:16 138:18

188:21 318:3,13

rises 59:12

risk 33:14 46:18,19,21

46:22 47:7,9,12,18

48:3 59:17 60:9

157:16 169:19,22

170:4 247:9,9,11

256:21 260:2,15

269:10 273:12 277:4

277:13,17 283:11

286:13 297:12 300:6

307:10 318:15 335:16

335:18 338:6 341:7

risky 318:15 319:10

road 65:18

Robert 2:7 185:9

304:17 305:21 308:18

ROBINSON 3:16

111:14 212:5,16

274:11 275:2

robo-call 354:4

robust 80:6 127:15

298:2

Rock 2:5

role 80:19 81:3 209:17

215:1,8

roll 24:6

Roman 171:12

RONALD 3:17

room 1:10 106:4 113:9

119:18 149:10 160:4

203:9 283:7 345:7

350:16

Rose 2:15

rough 183:12

roughly 8:22 13:8 152:9

round 170:20 194:15

284:22

route 85:20 252:5

Rozmyn 1:12,16

ruined 352:22 355:18

356:19,20

rule 7:10 11:9 18:2

19:15 22:6,8 42:9

61:2 80:12 83:6 87:2

103:19 110:10 113:18

143:3 177:14 179:20

180:4 221:20,22

222:1 272:17 274:3

274:13,13 298:14

320:5 340:16

rulemaking 1:3,10 5:17

7:6 13:2 34:10 108:22

151:8 326:19 340:22

340:22 348:20 350:8

351:14 352:7,19

357:16

rules 7:16 8:10 25:9

26:8 30:22 32:3 65:17

66:19 83:4 86:10

107:11 151:9 177:10

179:17 273:5 275:8

306:16 313:19 314:5

314:6 325:9 328:19

340:20

run 33:14 348:5,6

runner 114:7

running 64:14 275:22

S

S.W 1:11

sacrifice 101:3,19

sacrifices 101:16

saddled 353:15

SAE 1:17

safe 22:12 37:19 38:19

safeguards 7:11

safer 67:21 350:5

sake 241:7

sales 53:4

salespeople 53:11 54:3

salesperson 54:6

SALLUZZO 3:17

sat 14:11

satisfied 51:22 121:13

230:13

satisfies 193:17

satisfy 194:1

Savan 1:22

save 131:20 193:6

saw 100:17

saying 12:17 22:2

24:18 63:4 85:10

100:2 101:8 112:21

115:6 118:12 123:18

130:16 132:12 133:15

133:16 167:10 175:12

176:10 183:9 208:5

211:18 221:4 222:18

231:9 247:22 297:1

299:18

says 24:4 42:4 46:14

75:4 98:22 124:9

132:3 134:5 165:18

228:10 238:9 353:5

354:10,17

scam 355:17 357:4

scammed 108:1,6

186:20 208:4,5,6,9

scenario 181:2,4 251:9

scenarios 12:1 122:14

scheme 277:4,14,17,21
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

387

279:16

Schneider 353:2

scholarships 2:5,19

145:5

school's 52:5,10

235:17 236:5

science 343:2

scope 288:15 340:15

342:11

score 270:20 271:5

273:17 280:19 281:5

281:8,13 288:18

298:16 300:4 303:11

303:17 326:17 340:14

342:5

score's 342:14

scores 281:21 325:10

342:2

screen 22:21

scumbag 258:5

se 188:5 332:4

seal 107:2 116:17

searched 9:18

seat 324:16 355:5

second 60:3 131:3,18

134:20 135:17 152:8

157:3 172:18 186:13

194:12 208:11 209:7

216:6 217:14 235:16

245:12 252:3 265:6

269:8 289:5 327:13

328:9

Secondly 103:13 127:4

secret 21:15 27:13

secretary 4:11 7:17 8:2

8:21 11:7 19:19

159:12 183:7 267:3,9

Secretary's 8:16 158:16

159:1

section 20:10 23:7 54:8

296:20

sector 59:5 118:20

220:16 294:7

sectors 292:5 295:8

341:14

secure 67:22 345:8

secured 124:2

security 285:10

seeing 27:10 28:16

32:16 159:16

seek 36:9,19 188:14

196:4 235:8,10 316:3

316:12

seeking 63:7 80:17

84:6 125:3 185:14

209:8 210:8

seen 29:7,8 53:5 248:15

270:8 280:5 281:18

319:1,4,15,19

sees 300:1

seized 211:12

self-interest 256:20

self-interests 216:1

semester 123:1,2,7,8

123:10 143:8 355:5

semesters 123:4 143:7

Seminary 2:17

Senate 54:12

Senators 352:4

send 84:10 243:3

sending 201:1

Senior 2:10,21 3:13

sense 33:22 34:19

43:20 73:4 81:20 83:9

85:11 86:16 97:8

118:4 120:7,14,18

139:20 140:9 143:2

149:7 150:4 166:10

176:8 177:20 186:4

191:22 204:20 213:10

298:20 299:16 316:3

316:7,17,20 344:5

sensitive 257:21

264:13

sensitivity 258:3

sent 12:15 295:17

sentence 88:7 97:4

Sentencing 38:1

sentiments 274:12

separate 12:12 148:9

159:5,11 160:18

166:5 184:5,8 187:19

235:7 250:3

separating 181:8

separation 104:16

315:14

serially 126:19

series 284:4

serious 221:7 299:4

seriously 322:12

serve 26:8 36:5 263:17

served 195:17 340:7

342:14

serves 328:14

service 1:14,15,16 7:4

15:21 52:19

servicer's 315:5

services 2:10 12:16

187:2

servicing 179:18

serving 297:14 307:11

308:2 318:10 324:10

session 1:5 5:17 6:4

79:21 150:10 256:8

296:12 326:20 327:13

sessions 6:2 27:2,3

289:5 327:10

set 65:19 86:13 198:11

213:2 226:11 230:12

231:11 232:1 244:15

267:10 295:16 306:14

321:2 326:10 327:2,7

334:2

sets 317:11

setting 110:10 208:8,11

229:17 247:21

settle 192:21 222:5

321:9,12

settled 50:18 320:17

settlement 50:12,13,13

50:20 192:13 217:21

settlements 50:8

320:12,13 321:8,11

settling 150:11

seven 38:1 123:4 143:7

SHAFROTH 3:18 25:14

39:16 60:16 81:6

84:14 107:17 109:14

132:18 151:2 185:12

207:6 223:13 234:18

244:18 251:11 255:3

315:7,19,21

shape 58:18 302:11

share 8:7 63:22 109:15

233:6 327:19

shared 27:19 109:5,10

109:12 152:3

sharing 210:1 277:4,14

277:17

SHARP 3:19 83:12

143:18 231:21 261:12

305:22 308:13

shattered 196:8

Shaw 3:17

sheet 32:10

sheets 260:7

SHELDON 3:15

shoes 16:6

shooting 69:20

shopping 97:8

short 7:15 10:22 13:15

52:14 160:7 265:12

short-term 293:19

shortened 243:10

shorter 154:1

shot 70:8 114:13,16

351:19

shots 22:21

should've 337:11

show 28:18 32:2,14

148:18,22 267:15

343:16 349:20 355:3

showing 56:8 95:16

Shreveport 64:4,7,17

65:8,12 66:11 69:13

shut 246:19

shutting 205:12

side 12:19 17:12 69:2

233:6 243:20 244:3,3

310:1 315:5 341:19

349:16

sides 261:17,18

sideways 149:11

SIEGEL 4:13

sign 19:9 20:1 353:21

signed 225:9 228:8

significant 67:3 269:11

274:16 322:20 323:6

326:8,18,22 331:6

354:9

significantly 59:22

60:19 172:4

similar 61:9 79:14 98:9

167:3 202:3 215:17

317:3

simple 72:1 91:9 105:8

187:9 189:21 190:3

201:9 203:2 217:10

331:10 341:12 353:6

simply 77:17,22 101:12

127:11 138:2 177:21

245:2 301:22 325:14

sincere 222:15

single 62:21 157:9

158:10 159:19 193:9

201:11 203:2 240:15

sink 70:10

sister 335:9

sit 69:2,18,19 99:10

219:4 297:16 357:12

sitting 18:15,18 25:18

69:1,4 113:8 118:8

131:13 176:12 307:5

352:16 356:18

situation 8:4 53:14

62:13 75:13 105:10

113:19,21 114:15,20

123:17,21 163:18,20

177:16 187:3 201:11

213:21 216:19 217:18

218:9 237:1 243:7

299:3 304:12 335:22

337:22

situations 62:2 105:22

271:4 284:16 310:22

skill 88:10 97:6 98:16

111:20

skills 52:14

skin 144:6

skip 176:7

sky 47:3

SLATTERY 3:20
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

388

slightly 9:7 192:5

Slippery 2:5

slots 131:7

slow 236:10

small 64:4 65:2 92:19

92:22 105:14 121:16

174:16 187:4,22

246:14,19 247:2,3,20

307:10,16 308:2

318:9 319:9 326:7

327:4 334:14 345:5,7

345:11 346:11

smaller 246:12

snowball 264:9

soccer 114:7

social 19:7,11,13,22

20:1,17

solid 11:2

SOLINSKI 3:12 317:20

solution 6:8 27:15

219:6,13 306:4 311:8

solutions 306:6

solvency 300:3

somebody 46:8 97:19

100:3 117:12 120:15

136:4 176:14 218:7,8

218:22 238:22 278:6

Somebody's 278:1

somewhat 117:7

175:21 237:3

soon 14:6 15:13,13

29:10 242:7 358:15

SORN 9:16

sorry 57:12 81:8 135:9

147:16 156:4 177:9

206:6 255:21 315:17

335:20

sort 25:21 41:1 44:5

48:10,20 49:1 60:17

74:22 75:10,16,19

84:16 86:13 108:19

109:2 110:12 121:9

125:19,22 126:6,9

128:14 132:20 133:4

146:11 152:1 162:5

165:9 179:9,12

182:21 192:13 200:11

203:8 208:13 210:2

214:20 222:11,21

225:3,10 229:15

237:16 241:5 252:3

260:5 277:4 285:21

298:13,15 316:19

sorts 210:16 224:19

243:9

sound 11:4 171:9 246:1

246:2 293:12

soundness 289:18

293:22

sounds 46:5 72:11

207:18 248:20,22

251:11 312:5

soup 81:8

sources 92:15 94:2

south 64:11

space 345:8

span 154:2

speak 6:14 16:4 36:14

45:20 52:21 54:22

56:15 73:8 79:6 140:2

143:18 177:4 179:13

189:7 217:16 222:13

226:13,21 300:19

315:7 324:12

speaking 6:18 78:10

99:17 117:21 127:16

155:16 166:12,16

298:10 300:18 313:12

317:21 326:3 336:14

special 2:2,11 3:15

88:10 97:6 98:15

111:20

specialized 52:14

specific 13:10 21:8

50:17 85:5 98:22 99:1

99:8 141:2 170:22

195:3 210:22 228:10

230:12 310:13 311:13

314:11 321:22 322:13

325:5,21 330:22

337:13 345:22

specifically 20:11

42:16 106:1 139:17

142:17 174:5 195:2

204:13 289:19 296:10

300:20,22 305:5,18

311:12 329:13 330:22

specify 74:15 85:18

240:2 284:5

spectrum 220:13

speech 237:17

spellings 32:9

Spelman 2:8 328:15

334:15

spending 145:16

spent 65:12

spoiled 171:21

spoke 166:14 221:18

spoken 27:9 31:6

spot 206:12

spreadsheets 9:18

spring 10:5 11:12

SSAE 315:2

staff 3:18 4:9 47:4,14

93:2,4 159:21 160:8

160:22 161:9,15,18

169:9 182:18 190:9

staffer 193:13 194:4

staffers 159:21

stage 248:11

stake 263:22 333:19

stakes 203:20 204:3,9

241:2

stand 137:7 264:18

standard 34:13,15,21

35:6,20 37:9 40:22

42:19 43:1,12,15 44:2

44:10,19 46:5,7,13

47:6,17 48:1,5,12

49:1 50:4 55:9 56:15

57:16,18 58:1 59:13

60:3,19 61:9,13,16

77:2 79:4,5,9,17

81:16 82:22 83:1,9

85:10,21 86:14 88:19

89:11 91:17,20 92:1

93:14 96:10,13 97:11

97:13,14 106:3,8,13

108:9,10,12 121:12

161:3 165:10 169:8

172:21 193:17 194:2

230:2 243:12 288:21

307:3

standards 3:2 34:20

37:2 39:20 42:18

57:13 59:20 60:20

79:11 93:13 96:20

98:9 103:1 202:22,22

230:13 238:21 243:6

243:10 267:3 270:6,6

270:7,22 271:1

274:14 275:15 277:10

278:19 288:21 289:1

291:8,10,11,13,14,16

291:20 293:8 295:2,9

296:20 297:19 301:8

302:18 305:5 313:1

332:16,19 341:21

standing 75:14

standpoint 108:9 120:8

120:9 121:8 157:16

stands 270:20

start 7:4 32:19 81:16

106:9 112:11 119:13

119:17 121:7 162:5

175:12,18 176:6

189:19 196:14 199:1

266:19 269:15 275:7

305:14 306:6 337:9

started 5:5,13,20 6:11

6:22 64:16 69:17

73:14,15 150:10,11

150:12 152:13 154:12

183:9 257:11 266:14

starting 14:16 15:13

64:6 109:1 154:18

198:16 309:22

starts 104:7 344:14

stasis 205:2

state 2:6 3:7,14 8:15

15:6 35:14 51:2,15,22

52:1,3 60:21 61:3,8

61:13 76:3,9,20 77:8

79:11 80:7,11 81:4,4

81:17 83:14 84:4,9

85:12,17,21 86:1,6,8

86:17,19,20 87:12

91:13 93:16 98:7 99:2

99:11 104:12 105:16

112:8,16 113:1,2

118:21 119:4 131:5

148:20 158:8 177:3

177:13 188:19 201:21

202:21 210:8 215:2,7

215:11 225:17 267:17

309:2,3 310:14

316:18 345:18

state's 50:9 61:7

stated 125:16 168:21

174:7 228:3

statement 24:13,16

181:1 228:20 229:19

230:18 231:8 278:14

308:17

statements 21:14 112:5

113:4 263:10 283:15

states 2:9 51:10 76:2

76:10,15 77:3,15 78:1

78:12,14 80:17,19

81:3,9 82:13 84:17

87:10 105:20 126:8

140:14 177:10 202:11

210:10 309:5

stating 155:14

stations 315:3

statue 139:8

status 6:19 8:9,14

119:9 212:10,11,15

263:3 301:10 348:9

348:11

statute 12:10 36:22

132:3 136:22 145:22

146:4,7 147:5,7,9,13

148:4,10 154:14

155:3 156:2,10 157:6

157:11,17,21 158:6

158:12 159:15 162:6

162:8,13,19 163:6,9

163:13 164:7 166:7

166:13 167:9,11

168:6,9,9 169:9

170:12,18,22 171:2,8
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

389

171:11 172:16 174:1

177:2,3,13

statutes 82:14

statutory 12:22

stay 153:21 177:13

staying 104:4,18

stays 302:10

step 222:20 255:21

Stephen 114:4,9

steps 7:20 175:7 296:8

311:16 313:13 314:16

317:2

stereotypes 101:8

Stevaughn 2:1 92:8

94:13 95:19 217:1

stick 56:18 90:18,22

stockpiling 224:8

stop 19:6,6 317:9

357:20

stopped 211:2,5,8,17

211:19

stopping 64:7 199:3,20

store 90:20

stories 356:10

story 68:16 71:14,16

72:17 276:1

straight 276:11

strains 311:2

strap 44:10

strategies 268:21

streamlined 184:22

street 1:11 144:12

stress 282:1 299:4

308:1

strictly 25:22 270:21

strident 13:18

strikes 91:21 236:9

350:12

striking 92:4

stringent 70:17

strip 294:15

strong 65:17 70:17

153:9

strongly 47:16 57:5

100:22 143:19 145:7

146:3 159:17 163:14

180:6 208:12 210:6

211:4 252:10

structure 10:12 198:22

331:1

structured 164:19

struggle 309:21

struggles 354:8

struggling 278:12

338:15,21

stuck 306:2 357:9,10

student's 140:17

156:13 157:19 166:2

225:21 226:2 228:12

235:21 236:8 243:20

244:3 245:6

students' 95:16,16

studied 343:1

stuff 143:4 218:21

276:21 315:3 335:1

sub-regulatory 299:13

Subcommittee 270:1

270:11 271:14 280:16

288:13 291:18 305:4

305:14 323:20 324:5

324:16 325:17 326:4

327:11 329:12 330:22

331:17,22 332:9

333:6 336:19 337:7

338:10,14,17 339:2

339:10,15 341:15

342:12 343:16 344:6

344:12,14,21 345:1,5

345:22 346:5 347:3,8

subgroup 302:4

subject 40:17 61:1

91:22 95:21 159:22

250:11 341:20 342:22

subjected 163:10

submission 175:3

180:13 181:6

submissions 236:5

submit 50:5 175:13

188:12 203:5 223:14

225:15

submitted 197:9 225:17

234:22

submitting 174:20

178:4

subpar 127:3

Subpart 241:15

subpoena 225:5

subsequently 161:20

substantial 31:13 33:5

40:4,13,17 44:3,15

45:15 46:11 48:11,18

48:22 49:4 58:10,13

86:11 228:22

succeed 71:17 309:10

355:1

Success 3:10

success-wise 309:12

successful 10:10 67:9

159:2 277:15 293:7

316:15 355:3

succinct 152:15

succinctly 154:4

sudden 278:20

suddenly 36:9

sue 119:4 218:22 219:1

suffered 111:2

suffice 31:16

sufficient 34:22 105:20

175:3 180:14 182:19

182:21 226:16

suggest 48:4 108:3

157:22 165:11 193:12

229:21 248:13 294:3

suggested 96:18

suggesting 31:8 181:2

181:12 192:14 257:21

304:3

suggestion 165:20

166:11 168:2 230:18

297:18

suggestions 176:3

178:2 194:13 288:6

308:11 321:22 351:2

suggests 180:6

suit 210:8

suits 210:12

sum 10:22

summarize 99:18 154:4

summary 174:5 266:20

sun 69:17

superb 124:8

supervisor 54:6

supplementary 153:4

supplied 240:6

supply 258:16

support 17:5 91:13

106:7 116:4 119:8

137:15 143:20 205:1

211:4,15 223:10

225:7

supporting 143:1

supportive 204:21

supposed 299:7 346:10

353:7

supposedly 238:2

sureties 270:4 279:14

280:9 284:21

surety 268:18 269:9

273:18,22 274:9

280:1,5 285:15,21

286:15 289:9 290:9

291:4 292:14 298:13

300:10 302:19,21

319:21

surprise 205:22

surprised 318:14

surrendering 124:22

125:1

surrounding 56:19

survey 84:9

SUSAN 3:3

suspend 267:10 282:5

suss 228:1 259:10

Suzanne 2:21 79:1,20

90:15 145:18 162:3

swearing 229:11

swift 67:3

switch 104:8

sworn 225:7,21 226:2,4

228:20 229:19 231:8

system 9:17 61:18,21

64:20 66:18 67:16,22

71:21 72:1,2 106:13

172:10,11 201:15

202:3 208:14 310:18

systematic 54:17

188:21

systems 10:13 131:5

192:12,12 309:3

310:14 356:4

T

tab 349:16

table 5:10 18:18 19:5,8

21:1,17,21 22:5,11

25:2,8 28:4 45:20

46:18 56:14,17,21

72:14 89:18 96:21

102:21 117:18 140:4

141:9 153:9,14 167:8

181:17 264:7 282:17

304:22 306:7,8,12

313:17 330:5 333:15

333:18 334:1 350:20

tactic 275:9

tactics 54:11 275:8

tag 23:20 45:18 57:2

118:3 119:16 120:3

131:16 217:4

tags 147:17 159:16

317:17 339:17

taken 7:19 10:21 11:14

13:13 14:14 101:11

125:21 132:4 186:21

216:5 224:6 261:6

331:3

takes 7:8 66:22 206:16

206:19

talk 18:6 34:15 45:17

48:15 49:20 50:17

54:20 74:4 78:3 96:19

105:1,7,11,12 118:9

118:20 140:19 150:17

161:14,21 167:7

182:20 191:2 193:2

200:9,21 208:6 227:7

229:4 244:4,8 245:18

247:18 263:7 268:22

272:20 274:13 275:5

296:22 298:1 302:2

304:18 305:14 308:14

314:14 329:13 330:7
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

390

talked 16:14 37:7 43:5

85:16 97:3 102:10

118:3 167:8 177:1

218:6 233:2 268:17

268:20 287:22 352:8

talking 18:5 23:11

33:19 38:18,19,20

39:1 47:2,4 54:21

57:15,21 58:10 63:8

79:4 82:6,20 86:2

88:15 91:12 94:18

97:11 103:13 105:2,5

107:18 112:11 114:19

115:18 123:17 124:17

147:20 155:11 156:5

156:10,20 157:1,5,11

157:18 158:9 163:18

169:19 170:19 178:5

191:3 195:5 200:16

208:2 213:13,18,19

221:19 246:2 249:5

253:15 262:7 282:10

282:14 307:22 319:6

332:7 333:3 338:17

339:2 349:5 350:21

352:18 358:10

taller 114:10

targeted 52:19

TARNOW 3:21

task 319:8

tasked 305:2,3,3

taught 53:11 78:6

355:13,13

tax 66:14 119:9 211:11

taxes 66:15,16

taxpayer 10:1 59:22

267:19 296:9 297:10

304:11 306:22 310:7

311:6,18 316:11

317:3,22

taxpayer's 7:11 313:5

taxpayers 92:2,6

160:20 208:18 306:10

307:7 310:12 313:13

314:17 317:13 319:21

340:12

teach 67:10,17

teachers 51:9 355:8

teaches 205:8

teaching 51:10,15

355:12

team 10:6 154:1 188:5

201:12 202:6 203:11

teams 188:4

Tech 355:16

technical 255:6

technically 303:4,5

technician 67:13

technicians 67:10,11

67:17

technology 172:7

Ted 1:11,14 32:18

teed 151:15

tell 13:11 14:5 41:11

66:19,20 69:10 82:6

118:16 145:2 190:11

192:20 208:22 218:19

219:11 220:9 223:15

318:5 334:20 342:21

telling 21:16 41:16,17

73:2 93:22 95:17

108:1 127:10

temperature 140:8

141:10 146:12 295:17

303:12

tempting 144:12

ten 50:10 164:13

165:17

tend 208:19

tennis 107:15 234:11

tent 90:11 203:15 250:5

tents 111:10

tenure 8:18

term 7:15 10:22 11:3

13:15,16 15:14 33:10

46:3 53:7 63:10

179:15 182:12

terminate 267:10 282:5

termination 53:9

terms 26:1 27:5 39:21

79:12 90:18 91:14

100:21 101:14 113:18

118:6 132:19 133:21

137:15 164:7 180:17

186:13 202:15 204:9

208:19 209:7 213:5

216:7 219:17 235:2

235:22 279:17 287:3

317:1 327:4 338:9,18

territory 323:7 344:11

test 148:21 294:14

testimony 223:16

224:22 225:7,11,11

225:21 226:3,4

229:11

Texas 2:6

texture 330:13

thank 6:6 7:9 15:20,21

16:1,2,3,9 27:7 31:19

32:18 39:16 49:19

54:1 63:12,20 73:9,16

74:6,7 81:5 83:10

88:3 92:10 96:5,14

100:16 106:6 113:13

115:1 141:5,6 146:8

148:16 150:5 151:2

154:8 155:22 172:22

173:11 181:13 183:14

185:8,12 203:16

217:7 223:13 227:14

244:1 248:19 259:5

259:21 261:10 265:18

265:21 266:5,8

297:17 308:19 324:2

330:16 335:7,8,19,20

339:19 340:1 343:13

343:14 358:17 359:1

359:6

thankfully 227:16

thanking 7:4

thanks 20:2,17 37:2

71:10,13 90:10

107:17 194:19 207:6

303:6 324:17 330:19

themes 189:9

themself 258:9

Theological 2:17

theory 207:18

thereof 289:19

thermostat 295:16

they'd 242:5

things 16:19 19:13 22:4

33:20 34:8 35:12

36:14,15 39:1 40:19

44:11 72:3 74:4 76:4

82:8 87:22 92:13,14

94:7,19 101:13 103:9

111:21 112:4 113:12

116:10 118:4 119:22

125:11 144:14 152:1

154:7 171:7 177:11

184:11 194:12 198:8

198:19 207:17 224:2

224:19 232:10 240:8

240:13,17 242:18

247:14 257:13 268:12

270:17 271:2,7 277:6

282:8 287:18 288:1,2

288:6 289:2 299:19

306:21 314:20 319:5

319:14 322:7,12

332:21 334:6,11

350:22 353:21

thinks 118:2 300:6

third 161:8 190:16,17

210:2 289:5 317:21

Thompson 2:16

thorough 13:22

thought 17:14 18:22

31:21 33:12 41:19

42:12 60:5 65:11

68:19 69:6 74:20 75:2

138:3 151:18 154:15

154:19 218:18 237:22

242:9 260:4 281:4

300:18 323:6 325:21

327:3,3 331:16

354:11

thoughts 249:22

292:20 296:4 327:19

thousand 143:14

183:16

thousands 10:1 36:18

39:22 60:1,2 170:3,3

187:4,5 286:1 352:15

356:10

threats 172:8

three 27:1 67:6 83:2

93:11 124:4 158:3

165:3,18 199:15

248:8 276:2 281:20

294:16 310:17 356:9

threshold 248:7 274:4

290:8

thresholds 44:5

throw 180:9 223:22

throwing 113:17

thumb 90:13 147:16

thumbs 28:18 32:2,14

32:16 146:16,18,19

146:19 147:3 148:18

148:21,22 149:4,5,6

149:10 343:16

Thursday 203:8 327:12

344:14

tick 207:7

tie 168:2 244:22 273:13

299:20 310:6 313:4

tied 144:15 158:1

175:17

ties 309:16

timeliness 112:12

times 144:8 154:4

219:4,7 229:6 233:7

233:12 242:20 354:5

355:12

timing 27:5 251:7 257:7

title 116:16 150:21

267:6 286:2 290:13

320:16,21

today 5:6 6:16,19,21

8:2 14:5 16:18 23:4

25:19 26:12 28:15

95:4 153:19 166:14

171:22 172:1 181:21

197:7 214:2,9 233:7

262:2 264:21 270:20

276:15 300:5 306:1

309:18 322:14 323:2

323:21 348:9 350:17

350:20 352:3,6 353:1

359:2
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

391

told 51:20 52:2,6 54:7

69:16 70:11 100:3

107:2 207:13 208:9

224:17 238:16 276:1

353:16 355:21 356:5

358:3

tomorrow 23:4 95:4

153:19 322:4,15

323:9,15 337:3,3,10

344:13 345:16 346:9

346:19 359:4

ton 66:4 206:15

tongue 94:15

tons 101:3 351:18,18

tool 300:11

tools 5:9 300:11 355:2

355:6

top 72:14,18

topic 7:7 19:4 341:16

topics 88:3 341:14

total 299:8

totality 293:13

totally 34:13 97:7 129:4

161:16 258:15

touch 96:2 104:1

109:15 143:3 194:20

touched 323:21

tough 16:6 78:12

town 246:14,19 247:3

track 114:7 153:21

293:6 323:4 337:18

349:16

tracking 126:14

traction 310:2

Trade 81:13

traditional 285:3

train 66:17

trained 114:10

training 41:11 50:21

53:10 188:7

trains 53:3

transcends 294:1

transcript 1:21 131:13

133:12,13

transfer 50:22 52:16

115:10 126:15 127:19

128:10,14,18 129:3

129:15 130:4,11,15

130:19,22 131:7,9,17

131:19 134:9 356:7

transferability 52:13

90:2 129:2

transferred 115:13

transferring 127:5

128:16

transfers 52:8

transparency 20:17

333:5 338:20 339:1,7

347:10,12

treasurer 2:8 334:16

treat 252:6

treated 78:19 218:18

274:17

treats 7:12

tremendous 195:20

248:12 307:10

trend 15:12 217:9

trends 216:11

triad 310:10

tricky 306:13

tried 56:9 69:2 182:15

357:7

trigger 320:18

triggering 301:3,7

triggers 284:11 292:9

292:11 294:2 296:21

298:11 300:14,19

302:3 320:4 321:3,4

trillion 141:17

trip 304:6

trouble 311:21

true 52:9 98:3 100:5

108:3 193:19 356:8

truly 149:7 188:8 198:2

truncate 96:4

trust 100:14

trusting 100:10 224:6

truth 41:20 88:9 89:16

97:5 98:14 108:1

111:19 228:15 259:10

truthfulness 95:12

try 26:18 27:4 47:11

56:6 72:19 82:4 83:21

108:5 110:12 119:4

125:9,10,19 129:19

160:11 169:13 175:15

180:21 182:18 192:21

193:15 207:7,17

217:5 219:13 228:1

228:15 230:11,19

236:13 241:5 253:7

262:20 263:19 285:12

289:21 315:7 317:9

318:2

trying 26:6 33:22 43:12

44:9 68:6 71:16 72:9

73:3 76:19 77:7 78:13

83:6 99:19 101:9

139:2,9 140:3 142:3

142:14 154:7 163:1

166:1 177:17 198:18

213:20 215:1 216:2

218:16 221:1 222:5

227:5,10 229:22

232:9 245:13 258:19

274:21 291:12 306:14

312:3 319:11 347:11

350:22 357:4,5

358:20

TUESDAY 1:7

tuition 125:17 353:17

turn 5:13 10:20 32:16

63:18 74:16 84:22

116:19 146:10 321:19

335:12

turnaround 26:22 27:3

242:20 243:4,8 244:9

244:9,10,10

turned 45:7

turning 28:9 74:8

tutorial 355:14

tweaks 10:20

tweet 18:11 21:19

tweeting 18:8,10

tweets 19:5 56:16

twist 309:2

Twitter 19:2 23:15

two 17:21 25:14 33:1

37:2 39:16 40:19 44:5

51:3 58:22 59:1,19

63:18 72:3 80:3 83:1

88:3 117:7,22 118:2

119:13 120:12,12

130:9,17,21 134:6

147:16 157:6 158:15

159:6 160:17 163:3

169:6 176:13 181:7

187:19 189:17 213:14

218:17 234:5 245:3

271:19 273:13 275:12

277:18 294:21 307:22

320:7 324:3,5,11

327:15 328:2 337:8

340:21 341:5 342:15

343:3,3 355:18

356:14 359:3

tying 162:17 272:15

298:12

type 37:19 40:9 89:10

98:9 143:12 147:13

160:13 178:12 206:21

243:5 251:17 252:20

306:14 307:2 310:18

typed 247:16

types 35:9,10 37:14

71:5 77:16 112:9

125:11 158:6,8 185:5

207:3 240:13 284:16

306:21 307:22 313:17

325:3

typical 150:2

typically 268:18 286:3

U

U.S 1:1

UDAP 76:12 79:13 80:7

81:6,7,9 83:14 84:17

ulterior 221:8

ultimately 94:10 127:6

157:7 342:10,11

unable 345:9

uncertainty 135:19

uncharted 344:11

unclear 161:16

uncomfortable 196:10

unconscionable 264:8

uncovered 10:17 54:12

undergraduate 52:13

underlying 249:19

Undersecretary 6:17

142:16 176:17 181:21

underserved 309:10

understand 15:4 45:8

57:5 62:8,9 68:17,20

69:9 87:8 95:20

100:17 112:22 113:9

117:3 121:2,7 133:5

136:22 140:12 147:20

153:9 167:5 175:1

201:14 204:14 221:3

240:5 242:11 246:10

253:1 258:5 264:11

272:19 284:13 286:11

295:14 302:15 329:16

329:20 339:16 340:19

357:15

understanding 23:3

26:4 28:19 34:8 62:19

76:10 80:3 99:8 109:2

121:15 185:17 223:4

231:3 241:22 250:16

270:21 299:21 325:7

328:4 331:6

understands 302:5

understood 25:17

92:10 180:13 189:12

193:3 217:11

undocumented 62:7

undoubtedly 13:19

undue 308:1

unfair 45:13 62:13

76:12 81:7,12,19

85:18 96:11 98:8

102:22 113:8,20

114:21 136:1 188:8

351:22

unfairly 218:18

unfortunately 6:20 8:3

15:1 26:16 59:9 318:7

349:4

unified 171:4

uniform 82:22 83:9
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

392

275:11

unilateral 158:16

unintended 301:21

unintentional 41:5

57:22

Union 2:22

unique 271:4,11

unit 2:3 210:1 317:5

United 2:9 3:5

universities 3:7 276:17

277:5,14 300:21

301:1,14 302:9 356:8

university 1:19 2:1,5,19

3:4,11,14,17,19 99:1

99:13,21 100:14

107:3 247:12 279:2

328:13 341:6 342:21

343:6

unknown 260:10 309:7

unlimited 106:21

unnecessary 77:10

unofficial 99:5

unpleasantness 127:9

unprofessional 16:11

unreasonable 89:7

unrelated 250:14

unrestricted 289:12

unsubstantiated 92:3

unsuccessful 159:3

unsure 149:5

untenable 91:9

untoward 261:16

upcoming 23:4

update 84:15 165:13

348:9,11

updated 32:4 94:6

342:6

updates 5:15 342:6

updating 94:5

upset 16:20

urge 100:22 146:4

159:6

use 19:11,12 21:21

23:15 44:2,9 46:3,5

54:3,9 56:6 63:10

83:21 87:21 106:4

114:14 116:12 122:7

124:20 128:3 129:15

129:19 132:7,8

151:22 152:6,6

182:12 208:13 269:21

280:6 281:8 289:11

290:11 316:11 346:20

359:2

useful 152:1 168:19

227:8

useless 126:15

users 172:13

uses 108:13 280:2

usual 317:15 358:20

usually 100:9 158:2

233:10 239:3

utilize 297:9

V

VA 72:2 116:12,13

145:5

vacuum 225:19

Valerie 3:19 83:11

143:17 231:20 236:14

261:11 304:16 305:20

valid 144:1 203:4 261:9

285:19

value 122:20 125:6

143:11 161:19 313:1

313:8 335:4 337:13

338:3 341:12

vantage 309:3

various 34:14 126:17

vary 135:21

vast 186:19

vein 230:21

veracity 90:4

verbal 28:16

verify 133:11 257:6

Vermont 3:8

version 105:6 240:9

versus 62:12 78:18

88:1 104:2 107:19

116:5 131:8 135:13

155:15 177:2 187:17

199:7,21

veterans 2:13 3:9 71:20

116:7,11 195:16

vets 55:21

vice 1:18,20 2:7,10,12

2:13,16,19 3:5,12,16

64:3 334:14,16

Vice-Provost 2:18

victimhood 350:18

victimized 127:1

victimizing 126:20

videos 355:14

view 21:7 76:2 116:16

140:16 240:9

viewpoint 34:1

views 7:17 22:15 23:12

24:20 25:16 57:5,6

160:6

vigorous 277:7

vintage 293:22

violate 22:21

violated 25:21 61:7

violates 25:22 267:8

violation 202:21 267:16

virtually 105:13

virtue 181:8 297:14

vis-a-vis 161:19 168:7

294:8,10

visit 170:13

visual 28:17

vividly 294:19

voice 126:7 264:19

331:21 338:20

voices 333:8,17 350:15

352:22

volume 294:8

volunteering 330:19

volunteers 84:6

vote 30:22 325:1

345:17 346:9 348:2

voted 336:13 339:8

VSAC 3:9

W

wage 108:15

wait 170:17 344:19

345:16 357:12

waited 14:8 70:1 358:16

waiting 185:7 211:12

253:18 346:19 348:16

349:3 352:12 356:13

356:15

walks 312:6

Walter 3:9 43:17 49:7

49:13 53:16 96:15

98:10 99:15 100:20

101:4 116:2 178:14

179:1 181:19 291:1

292:3 302:13 317:18

320:1,1

Wanda 2:10 189:8

196:16 197:14 203:15

212:4 213:12 250:5

251:1 254:2 314:8

317:4

waning 9:3

wanted 6:14 26:9 31:2

55:6 58:7 59:15 63:14

63:21 75:18,22 77:4

81:2,22 85:13 92:9

96:7 97:2 98:11

100:20 116:3 132:19

134:2 137:20 143:18

145:19 147:18 151:20

178:16 179:3 183:10

188:10 195:8 201:5

205:5 212:19 221:17

240:19 244:18 245:2

249:14 261:12 286:19

287:3 292:4,7 299:11

302:16 321:15 345:12

348:6 350:15 356:3

358:1

wanting 28:12 121:7

209:10 284:14 303:16

wants 71:9 129:7

134:14 208:4 235:8

265:13 293:6 328:8

warm 303:12

warn 153:21

warrant 284:16

warranted 248:10

Warren 352:4

wary 245:13

wash 133:18

Washington 1:11,11

2:19 275:20

wasn't 33:11 38:11 42:2

135:14 138:8,9

244:19 326:9

waste 350:13

wasted 355:18

watched 355:14

watching 261:16

way 17:8 25:22 34:1

35:7 39:1 46:10 47:8

54:20 63:11 96:2

99:18 104:10 105:15

107:7 114:10,12

122:16 124:13 134:15

134:17 139:17 140:7

145:12 151:9 164:6

179:19 180:5,17

181:10 184:14 185:19

186:12 187:12 191:11

193:21 202:16 210:20

225:11 240:16 248:1

250:17 251:9 252:11

252:14 254:10 257:6

258:4,8,13 260:5,11

270:13 272:16 278:7

278:8 290:11 291:7,9

291:13,21 300:3

302:11 304:1,5,10

305:15 307:19 310:3

349:10 354:21 358:10

ways 81:10 121:9

213:15 261:5 281:14

282:15 303:19,21

309:17 316:22

web 183:21

website 30:3 52:10

104:9 348:19 349:1

websites 35:13

weed 193:22

week 15:19 29:5

weeks 17:22 23:4 52:15

294:22

weighed 264:17

weight 226:8

weightings 342:9
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

393

weird 162:22

WEISMAN 4:15 5:16

26:16 29:6,17 58:19

87:18 117:5 137:5,12

139:7,15 146:13

149:1 154:12 173:8

173:12 174:8 184:4

198:5 204:11 212:15

216:21 223:8 226:10

231:13 270:9 274:20

295:22 297:2 345:2

348:13

welcome 5:4,16 205:22

335:7

well- 304:14

wellbeing 101:20

went 52:5 64:9,10 65:12

66:6 70:4,11 73:11

147:17 150:7 247:15

266:11 355:4 358:7

359:8

weren't 101:9 110:13

111:8 144:15 255:4

307:17

whatnot 229:8

wheel 76:19

whistle 262:5,9

White 160:6 161:1

widespread 316:14

widget 124:14,17,20,21

125:4,5 129:7,13,14

129:20 132:20

widgets 143:15 312:17

wife 67:22

William 2:12 89:14

90:11 135:8 218:6

willing 19:16 70:21 84:5

101:10 102:6 212:1

252:4 332:21

win 114:13 219:2

window 200:16 242:19

winter 10:5

wisdom 335:6

wish 16:16 358:6,22

women 328:12,14

wonder 76:18 207:1

wondered 26:13 58:17

wonderful 26:13 94:19

wondering 19:17

137:22 216:12 218:10

260:2,9 278:21

word 56:16 179:19

275:9 314:14,22

347:11 348:16

worded 139:17

wording 83:15

words 16:7 46:8 113:17

284:6 335:6

work 5:12 13:13 15:2,9

15:15 16:1 26:7 35:8

62:8,9 68:1,12 70:22

77:15 93:10 101:10

110:15 116:7 122:12

132:21 134:18 152:9

182:17 207:17,22

253:6 266:8 271:14

280:15 283:12 291:17

298:17 303:11 305:2

326:6 334:18 341:2

350:1,5 355:8

workable 34:2,3,4

worked 10:8 27:14

64:11 69:5 110:18

118:16 151:7 275:19

330:1 341:19

working 7:9 8:3 13:21

14:18 15:10 20:6

32:15 66:14 83:18

93:5 110:15 131:5

183:17 202:3,12

223:14 242:17 254:11

295:13 308:10 309:3

311:12 322:2 324:22

327:5 329:12 334:8

334:12 340:9 341:3

341:10 343:18 344:11

344:14 345:6,11

347:2,19 348:1

349:12

works 77:20 202:16

222:13 310:19 351:9

world 160:6

worried 70:8

worry 70:2 217:18

256:12 355:22

worse 209:5 358:6

worth 100:12 117:10

121:19 128:16 134:6

214:22 269:1 316:10

worthless 72:22

wouldn't 42:9 55:22

57:22 61:14 83:5

84:10 111:6 120:16

165:19 244:22 257:13

299:5,20 344:5

353:17

wrap 262:20 321:6

wrapped 49:2

wrapping 248:21

265:22

write 222:1 249:14

353:22

writes 355:2

writing 22:8 99:3 100:5

141:2 226:1 279:9

written 22:22 23:8

29:15 55:6 83:16

99:14 179:20 180:5

248:4 249:17 272:17

wrong 46:9 132:12

133:15 145:21 186:2

218:8 222:22 258:6,8

275:9 330:21

wronged 120:14

X

Y

year 14:11,16 42:16

43:21 91:20 130:20

162:7,10 164:13,13

164:14 165:3,3 206:4

207:2 214:12 276:11

290:14 318:8 320:6

356:14

year's 108:22 145:22

151:8

years 17:12,14 64:15

124:4 130:9,17 131:6

158:3,4 162:19

164:14 165:17,18

167:15 173:18 174:14

184:15 276:2 283:21

293:15 305:11 309:8

309:8 332:17 334:17

340:9 342:17 343:8,8

343:11 355:18 356:14

years' 134:6

yesterday 5:21 15:5

16:17 18:4 20:22

22:20 24:1 27:14

28:13 30:8,11 32:7

33:4 49:10 54:21 58:9

58:15 77:1 310:10

323:17,17 333:4

337:3,6,9 345:22

349:20

yesterday's 32:22

yield 13:16 55:1

yields 271:14,14

YouTube 355:14

Z

zero 254:13

zero-sum 163:20

0

0.5 280:21

1

1,000 9:17

1.3 141:17

1.4 280:21

1.5 280:19 281:21

303:17

1:00 149:22

10 244:11 290:13 348:3

10,000 111:3

10:10 73:7,11

10:25 73:7,12

100 46:21 47:6 64:5,6

118:8 119:1 129:8

178:19 179:5 276:15

100,000 353:19

11:48 149:13 150:7

12 131:6 160:5

12:00 149:14

12:15 149:20

12:50 150:3,8

120 184:12 243:8

14 1:8

15 73:6 131:6 164:13

266:7 334:16

15,000 8:20

16 298:14

16,000 11:6

16,300 9:2

17 164:14

18 276:11

18.4 97:20

180 236:3 244:9

184 97:20

18s 315:2

1994 174:11

1995 185:18

2

2 5:18 27:3,18 30:19

31:22 32:21 85:7

149:18 150:5 152:10

170:15 174:3,8 197:5

223:5,7 255:19

262:20 265:22 266:4

269:4 279:12,22

284:20 292:20 295:13

295:21 327:10

2,000 11:15

2,800 9:7

2.3 223:9

20 17:14 152:9 293:15

305:11 334:17 354:5

20/20 319:2

200 350:3

2007 328:18

2012 50:9,14 54:12

328:18

2015 50:18

2016 8:12 13:1 40:3

43:22 46:12 86:10

108:14 138:10 197:17

232:4 240:9 274:3

284:22 286:22
(202) 234-4433 Washington DC www.nealrgross.com

Neal R. Gross and Co., Inc.

394

2017 1:8 343:11

2017-2018 1:3

20th 9:11

21 153:22

21,000 354:16

29,000 356:2

3

3 27:3 30:18 32:1 49:8,9

49:13 231:12 236:19

263:6 266:19 295:19

296:7,17 311:11,16

315:8 317:1 321:20

322:19 327:10

3:00 266:7

3:15 266:8

30 64:15 244:9

300,000 64:8

33 9:9

4

4 49:9,13 87:21 195:13

231:12,13 248:21

322:3 359:4

4:50 348:3

4:58 358:20 359:8

40 304:7

400 50:14

455 100:8

456 98:19

5

5 73:8 74:14 91:13

102:11 244:11 249:1

250:2,2 251:2

5'2 114:7

5,000 121:15 354:1

50 76:10 77:15 78:12,14

80:17 82:12,13 84:9

84:17 210:10

508 29:20

54 98:20 100:7

550 1:11

56 228:6

6

6 20:10 73:8 102:11

111:15 115:3 249:3,5

6(c) 22:12 23:7 25:15

60 192:20 193:14

600 92:21

61 17:12

65 13:8

65,000 8:22

668.15 293:4 295:5

67,000 354:15

682.211(I)(7) 197:17

685.206 140:14 267:14

7

7,400 121:16

750,000 274:4

76,000 353:17

8

8 85:7 152:10 359:4

80 41:14,18 45:4

9

9:00 1:11 5:2

90 183:16 197:2 320:19

90s 69:13,15 85:15

95,000 13:7 82:9 83:3

352:11 356:17

97 342:10
NEAL R. GROSS

COURT REPORTERS AND TRANSCRIBERS 

1323 RHODE ISLAND AVE., N.W. 

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 

C E R T I F I C A T E

MATTER:

DATE:

*IFSFCZDFSUJGZUIBUUIFBUUBDIFEUSBOTDSJQUJPOPG

QBHF to inclusive are to the best of my 

QSPGFTTJPOBM ability a true, accurate, and complete 

record of the above referenced proceedings as 

contained on the provided audio recordingGVSUIFS

UIBU*BNOFJUIFSDPVOTFMGPS
OPSSFMBUFEUP
OPS

FNQMPZFECZBOZPGUIFQBSUJFTUPUIJTBDUJPOJO

XIJDIUIJTQSPDFFEJOHIBTUBLFOQMBDFBOEGVSUIFS

UIBU*BNOPUGJOBODJBMMZOPSPUIFSXJTFJOUFSFTUFE

JOUIFPVUDPNFPGUIFBDUJPO. 

-----------------------

395

Borrowers Defenses and Financial

Responsibility Negotiated Rulemaking

Committee 2017-2018

11-14-17

1 395