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Now NPR has learned that the nation’s most powerful consumer watchdog, the Consumer Financial Protection Bureau, launched an effort to fix problems but the Trump administration blocked it from trying to help.
September 20, 2019 | Here’s Another Way Student Loans are Screwing You Over, Consumer Advocates Say
According to the Student Borrower Protection Center, a consumer advocacy group, the memo shows that Navient “orchestrated a predatory scheme to place borrowers in high-cost repayment options to boost corporate profits.”
September 19, 2019 | Navient memo raises questions about its student loan servicing practices
“The evidence unsealed in federal court confirms that Navient’s practices that added billions of dollars of debt to struggling borrowers emanated from the top echelon of the company,” said Seth Frotman, executive director of the Student Borrower Protection Center, an advocacy group. “The time has come for policymakers to admit this company’s practices are predatory and corrupt — it should not be given a single additional taxpayer dollar.”
Today, New York Attorney General Tish James sued student loan giant Pennsylvania Higher Education Assistance Agency, also known as PHEAA or FedLoan Servicing, for cheating teachers, nurses and other public service workers out of their right to loan forgiveness. In the face of mounting lawsuits and growing evidence of widespread predatory practices across the student loan industry, the organizations co-sponsoring AB 376, the California Student Borrower Bill of Rights, have renewed their call to the legislature to pass this critical borrower protection legislation.
Newly unsealed court documents reveal executives at the nation’s largest student loan company orchestrated a predatory scheme to place borrowers in high-cost repayment options to boost corporate profits. Reliance on these high-cost options, known as “forbearances,” resulted in more than $4 billion in unnecessary interest charges passed on to borrowers, according to lawsuits filed by federal and state enforcement officials.
Student Borrower Protection Center Executive Director and former CFPB Student Loan Ombudsman Seth Frotman issued a statement on the congressional inquiry announced yesterday into the Trump Administration’s failure to protect student loan borrowers, including obstruction of law enforcement officials by senior Trump Administration officials and abuses by the student loan servicing industry.
Testimony of Seth Frotman at the House Financial Services Committee hearing: A $1.5 Trillion Crisis: Protecting Student Borrowers and Holding Student Loan Servicers Accountable
Keynote remarks of Seth Frotman in conjunction with the release of the San Francisco Federal Reserve Bank’s paper, At What Cost?: Student Loan Debt in the Bay Area.
Testimony of Seth Frotman at the California Assembly Committee on Banking and Finance hearing: An Examination of the CFPB under the current Federal Administration and Options for California to Protect its Consumers.