Just because something is "legal" doesn't make it right or even ethical. The laws protecting students are paper thin. The FDCPA is practically the only protection given to students. Furthermore, per your admission, ECMC is classified as a non profit. How then does a non profit get enough "profit" then to buy an entire college?
Legalese is a very dangerous thing. You can practically define any words any way that you want so that it reads one way but then says another. Take for example how do you define who you are? Are you a person? Are you a citizen? Are you defined as something else? And later they've expanded person beyond what we would recognize it as such. By lay man's definition, you are both, but for the interpretation of law, you may be on or the other or possibly something else. Another way to look at it is what would the average person believe to be true? When dealing with ECMC, does the average person see them as an extension of the federal government or do they see them as a debt collector and a private entity? Also consider the case of Edward Snowden. Had he been employed directly he'd be covered under whistle blower protection laws but since he is not, then those laws don't apply. Had his legal definition been slightly different then we'd have learned his revelations and he wouldn't be facing any jail time. Furthermore, in some cases such arrangements are used to shield the government from blame and give plausible deniability and others I'm sure it doesn't release the government from harm. Also, if ECMC is truly just a contractor of Department of Education than I should be able to make contact with either the Department of Education or ECMC if I have questions about a loan. The fact that Department of Education refuses to answer questions at that point further solidifies that they aren't merely contractors that should be treated the same as the parent agency, but an entirely separate entity that needs to be dealt with as a private entity. And if you have complaints, the Dept of Education responds with you having to deal directly with the other company. At a workplace you work side by side between employees and contractors usually on similar issues and similar projects. Another interesting point is that they mention in the letter I shared the 7 year figure which is part of the Act (I reviewed the statute mentioned 682.410(b)(5) and found no reference in that section to a 7 year reporting requirement, see link below So how can they invoke the Act in one part and say they are exempt from it a few paragraphs down?
http://www.gpo.gov/fdsys/pkg/CFR-2010-title34-vol3/pdf/CFR-2010-title34-vol3-sec682-410.pdf
pages 856 (right column half way down) through 858(left column top half)
So yes, the fact that a non profit can claim exemption from FDCPA through legal trickery, then invoke it in once sentence and deny it applies in the next. They are taking advantage of definitions and legal loop holes. We need to step back and see what is right and just. If we deal with a private agency, we should have certain expectations and if we are dealing with a government agency we should have others.
Student loans are a huge epidemic in this country that is dragging down the entire economy and is affecting the mental health of students.