Leadership Conference Letter Regarding Forced Arbitration

Recipient: Acting Secretary King

View the PDF of this letter here.

Dear Acting Secretary King,

On behalf of The Leadership Conference on Civil and Human Rights, a coalition charged by its diverse membership of more than 200 national organizations to promote and protect the civil and human rights of all persons in the United States, we write in support of the petition[1]by Public Citizen, urging the Department of Education to require institutions, as a condition of receiving aid under Title IV of the Higher Education Act, to not include forced arbitration clauses in enrollment agreements with students. Forced arbitration clauses are often used by for-profit colleges to force students to waive their rights to take the college to court. Students of color and low-income students make up a significant share of for-profit college enrollment, and are disproportionately on the receiving end of fraud and misrepresentation as a result. These students must be allowed to use all legal means necessary to receive redress in the case of wrongdoing.

Arbitration often provides fewer constitutional and due process protections than traditional court proceedings. The process often happens without a jury, limits the inclusion of relevant evidence, and prevent claimants from joining together in a class action. Also, arbitration proceedings are often done in secret, which limits the Department’s ability to provide meaningful oversight over instances of institutional wrongdoing. For example, Corinthian Colleges used forced arbitration to hide their wrongdoing for years before news of their fraud became public.

From a civil rights perspective, students from vulnerable populations should be able to choose how they want to pursue remedies in the face of wrongdoing by institutions rather than being taken advantage of and stripped of their legal rights. Forced arbitration clauses are often found in the “fine print” of enrollment agreements, and students of color and low-income students, often first-generation college students, are especially susceptible to predatory practices which rely on obfuscation. Far too often, these students have enrolled after being sold on the promise of receiving an excellent education and gainful employment, only to end up saddled with enormous student loan debt and limited job prospects. With forced arbitration clauses, these students are left without the ability to pursue litigation and for-profits are able to avoid civil liability.

To the extent that action can be taken in the current negotiated rulemaking, we strongly urge the Department to act on the petition as soon as possible. Protecting vulnerable populations from fraud is crucial to the civil rights community. Moving forward, we would appreciate the opportunity to work alongside the Department to ensure educational equity for all students and protect all students’ right to legal redress. If you have any questions, please contact Liz King, Senior Policy Analyst and Director of Education Policy, at [email protected] or Nancy Zirkin, Executive Vice President, at [email protected].

Sincerely,

Wade Henderson
President & CEO

Nancy Zirkin
Executive Vice President

[1]http://www.citizen.org/documents/Citizen-Petition-to-ED-Title-IV-Arbitration-Clauses.pdf