DeVos Confirmation Hearing Reveals Investments in Student Debt Collection - Ethics Review Incomplete

During Betsy DeVos’s confirmation hearing on January 17, 2017, Democrats raised urgent concerns about her financial investments in student debt collection companies—conflicts of interest that remained unreviewed because Republicans rushed the hearing before the Office of Government Ethics completed its analysis. Documents revealed that DeVos’s firm RDV Corporation was affiliated with LMF WF Portfolio, a limited liability corporation involved in a $147 million loan to Performant Financial Corp., a debt collection agency that received 23% of its revenue ($20 million across 14 contracts) from Education Department student loan collection contracts.

The conflict was stark: DeVos would oversee the Department of Education, which awards debt collection contracts, while personally profiting from companies that collect on defaulted student loans—often from students defrauded by for-profit colleges. Performant had contracts to collect on some of the most distressed student debt, including loans from students who attended predatory institutions. Democrats complained they had no opportunity to question DeVos about these investments because ethics reviews were incomplete, but Republicans advanced the nomination anyway.

DeVos’s financial empire included investments across the for-profit education ecosystem: debt collection companies, education finance companies, and school privatization ventures. Her family fortune, built on the Amway multi-level marketing scheme, had been deployed into ideological and financial investments in education privatization, school voucher programs, and the student debt collection industry. The family had contributed an estimated $200 million to Republican campaigns and causes, buying influence to advance both ideological opposition to public education and profitable investments in education-related businesses.

The Performant investment exemplified regulatory capture: a billionaire with direct financial interests in student debt collection would control the agency responsible for protecting student borrowers and awarding collection contracts. After confirmation, DeVos was required to divest from Performant within 90 days, but questions remained about ongoing conflicts through complex family trusts and investment vehicles. In January 2018, the Education Department awarded a debt collection contract to Performant despite the company’s history of illegal practices documented by the Consumer Financial Protection Bureau.

The incomplete ethics review and rushed confirmation meant senators and the public never received full accounting of DeVos’s financial conflicts. Her subsequent actions as Education Secretary—freezing borrower defense regulations, blocking Corinthian debt relief, weakening for-profit college oversight, and awarding contracts to companies with which she had ties—demonstrated how regulatory capture works: install industry insiders with financial stakes in the sector they regulate, ensuring policy serves profit over public interest. DeVos represented the kleptocratic model perfected: use wealth to buy political power, use political power to protect and expand wealth.