WASHINGTON, D.C. — The Consumer Financial Protection Bureau (CFPB) filed today a proposed order against student loan servicer Navient for decades of defrauding borrowers. According to an announcement made by the CFPB, Navient would have to pay a $20 million penalty and provide $100 million in redress for affected consumers. The CFPB’s order also permanently bans Navient from most federal student loan activities.
Jaylon Herbin, director of federal campaigns at the Center for Responsible Lending (CRL), issued the following statement:
This is a step toward accountability and sends a powerful message to all student loan servicers that such behavior will not be condoned. For decades, Navient used deceptive tactics to steer borrowers into high-cost, long-term forbearances instead of placing them in affordable income-driven repayment (IDR) plans, leaving countless borrowers – many of whom were borrowers of color and low-income students – trapped in a cycle of debt.
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Press Contact: Vincenza Previte vincenza.previte@responsiblelending.org