U.S. Secretary of Education Betsy DeVos said Tuesday she plans to appoint Dr. Arthur Wayne Johnson — a longtime financial services industry executive who recently wrote a dissertation on private student loan debt — as chief operating officer of Federal Student Aid, or FSA.
“Wayne is the right person to modernize FSA for the 21st Century,” DeVos said in a statement. “He actually wrote the book on student loan debt and will bring a unique combination of CEO-level operating skills and an in-depth understanding of the needs and issues associated with student loan borrowers and their families.
“He will be a tremendous asset to the Department as we move forward with a focus on how best to serve students and protect taxpayers.”
Johnson’s appointment comes as FSA seeks to emerge from the turmoil that led to the resignation of its former head, James Runcie, an Obama administration holdover who resigned his post last month, citing a conflict with DeVos over her request to have him testify at a Congressional hearing on improper payments in federal student aid.
The hearing in question related to improper payments made in FSA’s Direct Loans and Pell grant programs. FSA currently serves 42 million student loan borrowing clients and administers more than $1.4 trillion in current outstanding Federal Student Loan balances.
It also comes at a time when concerns are being raised about the Education Department’s plans to offer a contract to a single servicer to administer federal student loans — a move that critics say would threaten quality and competition — and recent rollbacks in protections for student loan borrowers.
A statement from the Education Department says DeVos has charged Johnson with “executing her vision to simplify and modernize the federal student aid process, treat students as valued customers who are afforded the protections and respect they deserve and ensure Federal tax dollars are spent wisely.”
