Connecticut Moves to Limit Transcript Withholding Over Student Debt

• The Connecticut General Assembly passed a measure to limit transcript withholding over student debt.
• That measure bans colleges from withholding transcripts from a student's "employer, prospective employer, or a branch of the U.S. military."
• The legislation also bars colleges from using transcript release as a "debt collection method."
• A growing number of states have banned transcript withholding over student debt in recent years.

Connecticut may soon join a growing number of states that limit colleges from withholding student transcripts over debt.

The Connecticut General Assembly last week passed legislation that would ban colleges from withholding transcripts from prospective employers and the military over student debt.

Senate Bill 922, which now heads to the desk of Democratic Gov. Ned Lamont, bans higher education institutions from:

• Refusing to give a transcript to a student's "employer, prospective employer, or a branch of the U.S. military" over owed debt
• Requiring a debt payment as a condition of releasing a transcript to one of those three entities
• Charging higher fee to release a student's transcript to one of the listed entities over a debt
• Using transcript release "as a debt collection method"

The Consumer Financial Protection Bureau (CFPB) said last year that withholding transcripts when students have an outstanding debt is an "abusive practice" that violates federal law, BestColleges previously reported. Many colleges that offer loans directly to students withhold transcripts over outstanding debt, a practice that the CFPB says is meant to "coerce" borrowers into making payments.

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

A growing number of states have banned schools from withholding transcripts over student debts in recent years, including New York, California, Ohio, and others, BestColleges previously reported. Roughly a quarter of all U.S. students study in a state that offers protection against transcript withholding, BestColleges reported.