Seth Frotman, the federal government's top student loan watchdog, resigned Monday, accusing the White House of serving "the wishes of the most powerful financial companies in America" and abandoning consumers. Frotman, student loan ombudsman with the Consumer Financial Protection Bureau, will step down at the end of the week, reports the AP, noting that he is "the latest high-level departure" from the organization since White House Budget Director Mick Mulvaney took over as acting director in November. "The damage you have done to the bureau betrays these families and sacrifices the financial futures of millions of Americans in communities across the country," Frotman wrote in his resignation letter, which was addressed to Mulvaney.
The CFPB's loan ombudsman office, created nearly a decade ago in the wake of the 2008 financial crisis, has handled more than 60,000 student loan complaints, per NPR, returning more than $750 million to borrowers. The student loan market is worth $1.5 trillion, according to the Washington Post. Recently, though, Mulvaney moved the student loan office into the category of consumer education, rather than enforcement, the AP reports. Reducing enforcement work is a bureau-wide trend under Mulvaney, who has proposed changing or eliminating any rules or regulations established during the Obama Administration. Frotman's "departure raises concerns about the priorities of Mulvaney and CFPB leadership and whether they are fulfilling the mission of the CFPB to focus on protecting consumers from financial abuse," Debbie Goldstein of the Center for Responsible Lending tells the AP. (Read more Mick Mulvaney stories.)