Consumer Board: Transcript Withholding Is Abusive


The withholding of transcripts by colleges to pressure borrowers is abusive, the Consumer Financial Protection Bureau said Thursday in a new report that examined student loan servicers’ practices as well as colleges that provide loans directly to students.

The bureau said in January that it would look into borrowers’ experience with institutional lenders, specifically citing past abuses at Corinthian Colleges and ITT. During its review, the bureau found that many institutional lenders withhold transcripts if a student has an outstanding debt—a practice aimed at forcing students to make payments. Some institutions refused to release the transcripts until the entire debt was paid. In those situations, the student, or consumer, has little bargaining power or a reasonable opportunity to protect themselves, according to the report.

“Examiners found that institutions took unreasonable advantage of the critical importance of official transcripts and institutions’ relationship with consumers,” the report states. “Since many students will need official transcripts at some point to pursue employment or future higher education opportunities, the consequences of withheld transcripts are often disproportionate to the underlying debt amount.”

Institutional lenders have been told to stop withholding transcripts as a blanket policy in connection with student loans.

“Americans must exercise their right to their educational data to obtain a job or transfer schools,” CFPB director Rohit Chopra said in a news release. “Our examinations of lenders found that blanket policies to withhold transcripts can run afoul of the law.”

The agency also found that loan servicers improperly denied borrowers’ applications for relief through Public Service Loan Forgiveness and Teacher Loan Forgiveness programs, among other unfair and abusive practices.


Our names are Fareedah and Kamilah Amoo. We are seven and five year’s old sisters and live in Ontario, Canada, with our parents and little brother, Awad. We love writing stories, painting on canva, coding, reading books, and enjoying arts and crafts. Our goal is to motivate every child worldwide to read more books.

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