Democrats and Student Loan Borrowers Raise Alarm Over Elon Musk’s Access to Sensitive Student Loan Data

Topline

Reports have surfaced suggesting that billionaire Elon Musk and his associates at the Department of Government Efficiency (DOGE) may have access to sensitive student loan information held by the U.S. Department of Education. This has sparked concerns among Democrats and student loan borrowers, who argue that such access may violate federal privacy laws. While some borrowers have taken legal action, it remains unclear whether they will receive any relief—even if Musk’s access is deemed unlawful.

The issue has gained traction amid broader debates about government transparency, student privacy, and the future of the Department of Education itself. With former President Donald Trump reportedly considering the abolition of the agency, the stakes are high for millions of students whose financial aid and loan information is managed by the Department.

Key Facts

Recent reports indicate that Musk’s DOGE team has been closely examining the operations of the Department of Education, potentially as part of a larger effort to dismantle the agency. According to The Washington Post, DOGE staffers have accessed a dataset containing personal information for millions of students enrolled in federal student aid programs.

A group of students from the University of California has filed a federal lawsuit against the Department of Education, arguing that DOGE’s access to their data violates federal laws designed to protect student privacy. These laws include strict regulations that limit who can access borrowers’ information and under what circumstances. For instance, only authorized employees within the agency responsible for housing the data can access it if they have a legitimate need related to their duties. Other government employees can only access the data for specific, disclosed “routine uses.”

The plaintiffs allege that DOGE’s access to their data bypassed proper authorization processes, depriving them of privacy protections guaranteed by federal law. They also argue that borrowers were not given the opportunity to consent to DOGE accessing their information. Democratic lawmakers have joined the chorus of concern, with 18 senators demanding more information from the Department of Education about the extent of DOGE’s access.

Meanwhile, on platforms like TikTok, users have expressed outrage over the situation, with some suggesting that Musk’s access to their data violates the Family Educational Rights and Privacy Act (FERPA). However, as some legal experts have pointed out, FERPA does not provide a direct pathway for borrowers to seek financial relief—even if their rights are violated.

What To Watch For

A key development in the University of California lawsuit is a scheduling conference set for Monday afternoon. This could shed light on the timeline for the case and when a ruling might be issued regarding DOGE’s access to student loan data. The plaintiffs are seeking a court order to block DOGE officials and similar employees from viewing sensitive financial information, revoke any data they have already accessed, and ensure that any future access complies with federal law.

The outcome of this case will be closely watched, as it could have significant implications for how government agencies handle sensitive student data and whether freelance groups like DOGE can operate outside traditional oversight structures.

What Is FERPA?

The Family Educational Rights and Privacy Act (FERPA) is a federal law enacted in 1974 to protect the privacy of student education records. Under FERPA, educational institutions are prohibited from disclosing students’ personal school records without their consent—or the consent of their parents, in the case of minors. The law also requires schools to provide students and their parents with access to these records.

FERPA applies to all schools that receive federal funding, meaning compliance is mandatory for institutions wishing to maintain their eligibility for federal education programs. While the law is comprehensive in its privacy protections, it does not explicitly allow students to sue for financial damages if their rights are violated.

Can Student Loans Be Forgiven If DOGE Violated FERPA?

Despite claims on TikTok and other social media platforms, there is no provision in federal law that would allow student loan borrowers to have their loans forgiven if FERPA is violated. The Supreme Court ruled in 2002 that students do not have a private right of action under FERPA, meaning they cannot file lawsuits directly to enforce the law or seek compensation for violations.

While borrowers can file complaints with the Department of Education alleging FERPA violations, the agency is responsible for investigating and enforcing such claims. In this case, however, the Department is currently led by Trump appointees, making it unlikely that the agency would find fault with DOGE’s actions or grant relief to borrowers.

The only recourse available under FERPA is for the federal government to withhold funding from schools that unlawfully disclose student information. However, this has never happened in practice, according to the Student Press Law Center. For borrowers concerned about DOGE’s access to their data, the best option may be to file lawsuits alleging violations of other federal laws and seek court orders to block further unauthorized access.

What Happens To Student Loans If The Department Of Education Is Abolished?

The Trump administration has reportedly considered dismantling the Department of Education, a move that would almost certainly face legal challenges. If the agency were abolished, it is unclear how federal student loans would be managed in the future.

One proposal from the right-wing policy initiative Project 2025 suggests that the federal student loan portfolio could be spun off into a new government corporation led by presidential appointees and funded by Congress. However, it remains to be seen whether the Trump administration would adopt such an approach or chart a different course.

The implications of abolishing the Department of Education extend far beyond student loans. The agency plays a critical role in shaping national education policy, enforcing civil rights protections for students, and overseeing federal funding for schools. Its elimination could have far-reaching consequences for the U.S. education system as a whole.

Key Background

Musk’s reported access to student loan data is part of a broader pattern of DOGE inserting itself into government operations under the guise of reducing waste and inefficiency. The group has already gained access to sensitive data at the Treasury Department and has been linked to the dismantling of the U.S. Agency for International Development, among other controversial actions.

These actions have drawn significant legal pushback, including a court ruling barring Musk and DOGE from accessing Treasury data—a decision the Trump administration is currently challenging. Similar lawsuits have targeted DOGE’s operations across multiple government agencies.

The targeting of the Department of Education by DOGE and the Trump administration is part of a long-standing effort to shrink the federal government’s role in education. Trump has repeatedly criticized the agency and called for its abolition, setting the stage for a high-stakes battle over the future of federal education policy.

As the situation continues to unfold, borrowers, lawmakers, and advocacy groups are urging greater transparency and accountability to ensure that sensitive student data is protected and that federal laws are upheld.