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Just over a year ago, the U.S. Department of Education abandoned key oversight of the companies that run the federal student loan program, according to a new report from the nonpartisan U.S. Government Accountability Office .
GAO investigators found that, in February 2025, the Office of Federal Student Aid stopped reviewing the accuracy of loan servicers' records. FSA also stopped reviewing recordings of calls with borrowers to make sure they're being given accurate information.The Office of Federal Student Aid is supposed to conduct quarterly reviews, according to its contracts with loan servicers. These reviews include comparing loan servicers' borrower records with FSA's own records, to screen for gaps or discrepancies, as well as"targeted reviews" of borrowers in specific situations, including those who request temporary relief from their payments.For borrowers, servicer mistakes can lead to very real problems, said Rep. Scott in a statement to NPR."Borrowers can either overpay or be placed in the wrong student loan repayment program. refusal to conduct oversight of student loan servicers is a dereliction of duty." These cutbacks in staff and oversight come as millions of federal student loan borrowers will need help transitioning into new repayment plans.Just over a year ago, the U.S. Department of Education abandoned key oversight of the companies that run the federal student loan program, according to aGAO investigators found that, in February 2025, the Office of Federal Student Aid stopped reviewing the accuracy of loan servicers' records. FSA also stopped reviewing recordings of calls with borrowers to make sure they're being given accurate information."If servicers' records are inaccurate, borrowers could, for instance, be placed in the wrong loan repayment status, billed for incorrect amounts, or not have a refund processed in time," the report says."Similarly, FSA has not monitored calls since February 2025, so there is a risk that borrowers have received or will receive incorrect information and poor customer service." The investigation was requested by the ranking members of the House and Senate education committees, Rep. Bobby Scott, D-Va., and Sen. Bernie Sanders, I-Vt. "Instead of providing relief to 43 million Americans who are drowning in student debt," Sanders said in a statement to NPR,"the Trump administration has made it harder for them to understand how much they owe and how long it will take to pay back."The Office of Federal Student Aid is supposed to conduct quarterly reviews, according to its contracts with loan servicers. These reviews include comparing loan servicers' borrower records with FSA's own records, to screen for gaps or discrepancies, as well as"targeted reviews" of borrowers in specific situations, including those who request temporary relief from their payments. The assessments that were stopped are more labor-intensive than other types of oversight that have been automated, GAO says. According to the report, agency officials told the government watchdog they stopped these reviews in early 2025"due to lack of FSA staff capacity." That's around the same time the Trump administration began dramatically reducing staffing levels at the Education Department. According to the report, FSA began 2025 with 1,433 staffers; by December, it had 777 — a 46% reduction. In a written response accompanying the report, Richard Lucas, FSA's acting chief operating officer, disagreed with GAO's recommendation that FSA resume the reviews. While he confirmed that FSA had, indeed, stopped the oversight in question, Lucas wrote,"FSA determined that a better approach is to provide substantial oversight through additional activities that measure the accuracy of servicer data and the quality of their performance." Those activities include regular reviews of borrower satisfaction surveys."While reviewing those satisfaction surveys may be helpful, they don't directly assess the quality of the information given to borrowers. A borrower may indicate they were satisfied with a call, not realizing they were given completely wrong information by their servicer," she says.Scott Buchanan, the executive director of the Student Loan Servicing Alliance, which represents the servicers working on the federal student loan program, says servicers also police themselves. " internally are monitoring far more than any of our regulators ever could or would. Because it is in our best interest to make sure those errors are fixed. And because we have contracts, and if we have major issues that have become clearly apparent, then people will say, 'We'll find someone else to do it.'" At the end of 2024, before the Trump administration cut oversight, GAO's review of servicer recordkeeping found that"four of the five servicers did not meet the accuracy performance standard and faced associated financial penalties." In fact, recordkeeping at two servicers was troubled enough to merit the maximum financial penalty allowed. And GAO notes that the Education Department's independent financial auditor reported as recently as January 2026 that the department"continued to have a material weakness related to the reliability of its student loan data." What's more, Emrey-Arras says, scaling back oversight at FSA has also meant scaling back efforts to hold servicers financially accountable for their performance. This accountability, she says,"is critical. Without it, the government risks overpaying for poor performance." For borrowers, servicer mistakes can lead to very real problems, said Rep. Scott in a statement to NPR."Borrowers can either overpay or be placed in the wrong student loan repayment program. refusal to conduct oversight of student loan servicers is a dereliction of duty."These cutbacks in staff and oversight come as millions of federal student loan borrowers will need help transitioning into new repayment plans. The Biden-era SAVE plan is in turmoil, with borrowers now being charged interest and the plan due to be closed by 2028 at the latest. Another 12 million borrowers areGAO warns that these changes will affect millions of borrowers who"will need accurate and complete information when they call for help," yet, for the time being, the Education Department can't be certain that's what borrowers are actually getting.Residents who were forced to use disaster shelters are being asked to share their experiences in a new post fire community survey.The county is looking for people who were evacuated, experienced property damage, used disaster shelters, became unhoused, attempted to volunteer, or went through other fire related recovery processes. Residents who weren’t directly affected by the fires can also share their observations of the county’s response to the fires.Tony and Sara Iagmin hold a three-month-old baby they are fostering at their home in San Diego’s Lakeside neighborhood.Since 2024, more than two dozen nonprofits that recruit, train and support foster parents have shuttered across 13 counties, according to the California Department of Social Services.Counties have historically relied on the licensed nonprofits, known as foster family agencies, to place children — especially those in need of intensive support — in certified homes until they are adopted or reunified with their birth families.An insurance crisis continues to rattle California’s foster care system, threatening to displace thousands of vulnerable children. Since 2024, more than two dozen nonprofits that recruit, train and support foster parents have shuttered across 13 counties, according to the California Department of Social Services. Counties have historically relied on the licensed nonprofits, known as foster family agencies, to place children — especially those in need of intensive support — in certified homes until they are adopted or reunified with their birth families. Their closures come two years after a key insurance carrier backed out of covering foster family agencies, citing rising legal costs. The company, Nonprofits Insurance Alliance of California, covered approximately 90% of the more than 200 foster family agencies operating throughout the state, leaving them scrambling to find a replacement. No other California insurers have stepped in since then, forcing foster family agencies to secure coverage from companies outside the state — and sometimes, outside the country. In an unregulated market, that’s meant that agencies have seen increases of 200 to 400% in their liability coverage. Many are reporting cost hikes of more than $350,000 in annual premiums. The Legislature last year approved a one-time $31.5 million allocation to buoy the agencies as they face unsustainable premiums, but the money has run out. Assemblymember James Ramos, a Democrat from San Bernardino, and Sen. María Elena Durazo, a Democrat from Los Angeles, recently requested another $30 million in relief funding. Tony Iagmin holds a three-month-old baby at his home in San Diego’s Lakeside neighborhood on Feb. 23, 2026. Tony and Sara Iagmin are fostering the baby.But without any long-term policy solutions, advocates warn that the whole system is at risk of collapsing. It would start with some or all of the remaining foster family agencies closing. Foster parents, lacking the support that’s needed to sustain them, could then exit the child welfare system altogether and kids would face even more instability, the advocates say. And medically fragile children — including kids with feeding tubes, developmental disabilities or drug dependencies from their mothers — are especially at risk because counties don’t typically have sufficient resources to provide that level of care. “It would be an absolute crisis if the foster family agencies closed,” said Diana Boyer, managing director of research and policy at the County Welfare Directors Association of California. “Foster children are the state’s children. We all collectively need to be doing more to support them and ensure that they have homes and families to go to.” The crisis is tied to California’s attempts to provide redress to survivors of sexual abuse. Legislation passed in 2019 lifted the statute of limitations,. Thousands of lawsuits have been filed since then, and hefty payouts have driven up insurance costs for public agencies across the board. Schools wereafter a jury found that a foster family agency in Santa Rosa failed to protect them from sexual abuse. The group had alsoRoughly 300 foster family agencies operate throughout California, providing critical services to approximately 6,500 of the state’s 45,000 foster children. Counties run many of their child welfare placements through the community-based nonprofits because of their quality of care — especially for kids with the highest needs. If a child is removed from their home in the middle of the night due to abuse or neglect, foster family agencies quickly step in with supportive homes that are “at the ready,” said Pete Weldy, chief executive officer at the California Alliance of Child & Family Services, which represents roughly 200 foster family agencies around the state. After initial placement, the agencies continue to work with foster families and kids to provide sustained support, including around-the-clock care, crisis assistance, and consistent case management.“That’s one of the untold stories of this whole crisis,” Weldy said. “It could mean that the youth has to move to a different county, to a different foster family. They could be uprooted from their family. They might have to change schools, maybe move communities, lose their friends.” The disruption, he added, can often exacerbate behavioral health needs. “Eventually, it could lead to the worst outcome, which is that the child ends up unhoused,” he added. If counties are unable to find a placement, Weldy said the child may end up in a hotel, hospital, or conference room. “This is the state’s responsibility and really, therefore, all of our collective responsibility to make sure these really vulnerable kids and youth have what they need to thrive,” he said. “And that’s where foster family agencies do such an incredible job.”Tony and Sara Iagmin play with the baby they are fostering at their home in San Diego’s Lakeside neighborhood on Feb. 23, 2026.Sara and Tony Iagmin have fostered 45 children since 2013, when they started working with Angels, a San Diego-based foster family agency that recently closed due to the insurance crisis. Over that period of time, they worked with three case managers from the agency that would make weekly visits to the child or children they were currently fostering. That consistency served them and their foster children well, they said.They fear that the increasing number of agency closures will result in more kids falling through the cracks and hurt foster parents, especially those who are new to the child welfare system and may need additional support. “Foster family agencies are like AAA and the county is like the DMV,” Tony Iagmin said. “They have good workers, but it’s a lot of bureaucracy.” Since Angels closed, the Iagmins started working directly with San Diego County. They said they feel well-equipped to handle the shift since they’ve been foster parents for so long, but will miss the community they found through Angels.Photos of families Sara and Tony Iagmin have worked with over the years hang on a wall at their home in San Diego’s Lakeside neighborhood on Feb. 23, 2026.In Placer County, Sarah and Michael Prince have worked with the foster family agency Koinonia Family Services since 2016. After struggling with infertility for over a decade, the couple decided to attend the agency’s orientation.It took them two years to go through the agency’s certification process. Since then, the couple has taken in 13 foster children, four of whom they ended up adopting. “I couldn’t have done it without a foster family agency,” said Sarah Prince. “It’s an extra layer of protection for you. They are your family. When the things fall, it’s the knowing that you have somebody to call. It’s consistency for these kids that haven’t had consistency because your foster family agency workers don’t change.” Laura Richardson, a manager at Koinonia Family Services, said the statewide agency works with roughly 360 homes, 99 of which are not taking placements. On any given day, they serve around 200 youth in their foster family homes. According to Richardson, the organization’s insurance increased by 242% — from $272,000 to $933,000 per year — since the Nonprofits Insurance Alliance of California stopped renewing their policy. It’s meant that they’ve had to rescind their licenses in three cities, transferring those families to other offices that are still operating. Richardson said they’re trying to hold out for as long as they can for the state to come up with a solution. But as more and more agencies shutter, she worries that the homeless population will increase for youth. “I worry about the safety net for these most vulnerable youth going away,” she said. “It’s going to stress other parts of the system. So the state is going to have to pay for it somewhere. My hope is that we can fix what’s good about what we already have before we lose it.”If you're enjoying this article, you'll love our daily newsletter, The LA Report. Each weekday, catch up on the 5 most pressing stories to start your morning in 3 minutes or less.The leader of the Los Angeles Unified School District says he acted lawfully and has asked to be restored to his position. Alberto Carvalho issued his first public statement since federal agents searched his home and office in late February through a law firm.Federal agents searched Carvalho’s San Pedro home and district offices on Feb. 25. The reason for the searches is unknown. A Department of Justice spokesperson said the agency has a court-authorized warrant, but declined to provide additional details. The FBIon paid administrative leave “pending investigation,” and appointed longtime administrator Andres Chait as acting superintendent. In response to LAist’s questions about Carvalho’s desire to be reinstated, an LAUSD spokesperson wrote, “The Los Angeles Unified Board of Education respects his right to defend himself.”Carvalho’s statement states that while the investigation is ongoing, there has been no evidence presented showing he violated federal law. “Mr. Carvalho respects the rule of law and the investigative process and has always acted in the best interests of students and within the bounds of the law,” the statement from Holland & Knight LLP states. “Mr. Carvalho remains confident that the evidence will ultimately demonstrate that he acted appropriately and in the best interests of students. We hope the School Board reinstates him promptly to his position as superintendent.”Alberto Carvalho, the superintendent of Los Angeles Unified School District, has asked to be restored to his position after being placed on paid administrative leave last month. The request was included in his first public statement since federal agents “Mr. Carvalho respects the rule of law and the investigative process and has always acted in the best interests of students and within the bounds of the law,” read a statement provided by a spokesperson for Carvalho through the law firm Holland & Knight. The statement said the government’s investigation is ongoing and no evidence presented by prosecutors supports allegations that Carvalho violated federal law., was released nearly two weeks after federal agents searched Carvalho’s San Pedro home and district offices. The reason for the searches is unknown. A DOJ spokesperson said the agency has a court-authorized warrant but declined to provide additional details. The L.A. searches are linked to a search of a South Florida home the same day. That property, first identified by. “Ed” was designed to be a"personal assistant" capable of nudging students who were falling behind and providing resources for learning.The district has not responded to LAist’s questions about the reasoning for placing Carvalho on leave or whether the “investigation” referenced is federal or internal. “Mr. Carvalho remains confident that the evidence will ultimately demonstrate that he acted appropriately and in the best interests of students,” read the statement. “We hope the school board reinstates him promptly to his position as superintendent.” In response to LAist’s questions about Carvalho’s desire to be reinstated, an LAUSD spokesperson wrote, “the Los Angeles Unified Board of Education respects his right to defend himself.” LAUSD Board President Scott Schmerelson did not respond to LAist’s request for an interview or comment about Carvalho’s statement.“The achievements and success of the students, teachers, and staff of Los Angeles Unified remain his foremost focus,” the statement read. “Mr. Carvalho also expresses his sincere gratitude to all those who have extended their well wishes and prayers.”Wednesday, the International Energy Agency announced member nations would release a total of 400 million barrels from their strategic reserves of oil as the war in Iran continues to cause the worst disruption to energy markets in decades.The unanimous decision by the members of the IEA, which represents some of the world's biggest oil-consuming nations, is meant to address the acute disruption in oil trade caused by the war.It's the largest release of crude oil the IEA has ever coordinated, and only the sixth time the group has released oil to balance crude marketsWednesday, the International Energy Agency announced member nations would release a total of 400 million barrels from their strategic reserves of oil as the war in Iran continues to cause the worst disruption to energy markets in decades. The unanimous decision by the members of the IEA, which represents some of the world's biggest oil-consuming nations, is meant to address the acute disruption in oil trade caused by the war. It's the largest release of crude oil the IEA has ever coordinated, and only the sixth time the group has released oil to balance crude markets. IEA executive director Fatih Birol said on Wednesday that the decision by IEA members, who together control some 1.8 billion barrels of stockpiled oil, is a"major action" meant to alleviate the disruption of oil markets. "But to be clear, the most important thing for a return to stable flows of oil and gas is the resumption of transit through the Strait of Hormuz," he said. Details about the timing and the amounts of oil each country will contribute have not yet been announced.first reported about the pending IEA recommendation, but were hovering just under $90 after Birol spoke on Wednesday morning. That price had been around $70 before the war began,The IEA was formed in the wake of the oil crisis of the 1970s. It serves as a sort of counterpart to OPEC, the group of oil-producing nations that work together to coordinate production. While OPEC represents the interests of oilIt coordinates national stockpiles to create a buffer in the case of an extreme shock to global oil supplies — precisely like the one the world is experiencing today. The group has 32 member countries, including the United States, Canada, Australia, New Zealand, Turkey, Japan, Korea and most nations in Europe. More than a dozen countries are affiliated with the IEA as"association countries," including China, India, Thailand and Kenya. All together, the IEA estimates that its countries account for 80% of global energy demand. A requirement for membership in the IEA is that countries must commit to maintaining substantial reserves of crude oil or distilled petroleum products, enough to cover at least 90 days of that country's exports, as well as undertake programs to reduce dependency on oil.producing more oil than they need. That means under IEA rules they aren't required to keep stockpiles. But the U.S., which is both the world's largest consumer of oilThe U.S. Strategic Petroleum Reserves were last tapped in 2022, during the most recent IEA-coordinated release of oil, in response to Russia's full-scale invasion of Ukraine. It was only the fourth time the SPR had ever been tapped. Both the Biden administration and then the Trump administration have signaled plans to refill the SPR, but officials have reported that damage to the underground salt caverns that hold the oil hasOil prices have swung wildly over the past week, as ship traffic came to a near-standstill in the Strait of Hormuz, a vital waterway through which approximately 20% of the world's oil and liquefied natural gas typically travels. Iran's closure of the strait is blocking millions of barrels of oil per day from reaching markets. And it's having knock-on effects; countries like Iraq and Kuwait have had to stop producing oil in some fields because with storage tanks full and no ability to send ships through the strait, there is simply nowhere to put the oil. Some oil is being redirected, including through a pipeline Saudi Arabia can use to send oil to the Red Sea for export. The U.S. has waived sanctions on Russian crude to ease pressure on markets. Now, IEA members are also helping rebalance markets by tapping their stockpiles However, the oil in those stockpiles cannot all be pulled out immediately; there is a physical limit on how quickly it can flow. And oil analysts agree that, as Birol acknowledged, that all the world's responses put together cannot fully compensate for the disruption created by the Iran war. "There is simply no substitute for restoring access through the Strait of Hormuz," Angie Gildea, the global oil and gas leader for accounting giant KPMG, told NPR in a statement sent by email earlier this week."The tools at our disposal, including strategic reserves, rerouting some exports and floating inventories, can provide some relief at the margins, but they are not structural solutions."
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