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As many of you already know, the U.S. Department of Education (ED) has been sending out Borrower for Defense to Repayment (BDR) claims through the Common Origination and Disbursement (COD) system.

That is the only notification system used for BDR claims. Most notices come with a 60-day or shorter response time; therefore, it is crucial to consistently monitor COD to ensure you do not overlook any BDR inquiries or have any late responses.

The current enforceable BDR rules are from 2019, but so far it appears that all of the claims received by our institutions are from 2016 BDR. The individual or group claims have a cover letter, with a column heading, workflow regulation 2016.

The rules allow claims for any of the following:

  • Employment Prospects
  • Career Services
  • Accreditation and Licensure Qualifications
  • Transferring Credits
  • Educational Services
  • Program Cost and Nature of Loans
  • Adverse Judgment, Breach of Contract, Others

Things to consider including in your response:

  • Student Records and Enrollment Agreements
  • Communications with Student
  • College/Academic Catalog/Handbooks (covering periods of enrollment)
  • Employee Training Materials
  • Phone Call Scripts and/or Recordings
  • Marketing Materials
  • Is the claim beyond Record Retention Requirements? (which don’t really seem to make a difference to ED)

The claims may cause serious consequences for your institutions and should not be taken lightly.

At a minimum ensure that your responses are complete, including any documentation you may have, meet the required deadline, and you consider working with counsel on these responses.



Sally Samuels

Director of Compliance, FAME

Sally is one of the country’s leading authorities on Federal financial aid administration with 41 years of “in the trenches” experience. As a respected Industry leader, she is frequently called upon to speak at School, Accrediting, Regional and State conferences as well as to act as school liaison during program reviews and compliance audits. Having processed, reviewed and taught financial aid for 42 years Sally’s experience includes representation at over 300 program reviews and certification visits for postsecondary institutions.