On August 3, 2015, a national bank revealed in an U.S. Securities and Exchange Commission filing that its student loan servicing practices are under investigation by the Consumer Financial Protection Bureau (“CFPB”). The bank indicated that it is cooperating with the investigation and anticipates the CFPB may order it to remediate its customers and/or…
On July 23, 2015, the Consumer Financial Protection Bureau (“CFPB”) filed a complaint and proposed consent order in the United States District Court for the Eastern District of California in connection with a settlement reached with a student loan lender that offered fee-based assistance to consumers filling out the federal government’s Free Application…
On July 22, 2015, the Consumer Financial Protection Bureau (“CFPB”) issued a consent order against a national bank and its affiliates for its servicing practices affecting private student loan borrowers. The order asserts that the bank violated various sections of the Consumer Financial Protection Act of 2010 (“CFPA”) and the Fair…
On July 1, 2015, Governor Cuomo announced a student loan debt relief provider was ceasing operations following an investigation by the Student Protection Unit of the Department of Financial Services. The company allegedly engaged in misleading and deceptive advertising as well as other improper practices. The company claimed it could…
The CFPB’s Request for Information On May 14, 2015, the Consumer Financial Protection Bureau (CFPB) held a field hearing on student loans in Milwaukee, Wisconsin and issued a Request for Information (RFI) about student loan servicing practices. The RFI is in response to a Presidential Memorandum that instructed the Secretary…
On May 4, 2015, Illinois Attorney General Lisa Madigan announced five lawsuits filed on behalf of the State against student loan debt settlement services companies based in Texas, California, Florida, Georgia, and Illinois. The complaints allege that the companies violated Illinois’ consumer protection laws by charging hundreds to thousands of…
On April 7, 2015, the Washington State Attorney General Office announced that it filed suit against a California-based student-loan debt-adjustment company, alleging that the company charged illegal fees in violation of Washington’s Consumer Protection Act and the state’s Debt Adjusting Act. According to the complaint, the company allegedly marketed services…
The Consumer Financial Protection Bureau (CFPB) recently announced that it had reached an agreement to give students of Corinthian College, Inc. at least $480 million in principal reductions on existing student debt. Former and current students will receive an immediate 40% reduction on existing principal balances of their loans with…
On February 2, 2015, the CFPB announced that it had reached a settlement with the ECMC Group and the Zenith Education Group (collectively “ECMC”), two companies that had purchased colleges formerly affiliated with Corinthian Colleges, Inc. ECMC agreed to coordinate $480 million in debt relief for current and former Corinthian…
The latest CFPB Supervisory Highlights report details the Bureau’s concerns regarding student loan lenders. The report, which is the fifth edition of Supervisory Highlights, generally covers supervisory activities between March and June 2014. In it, the CFPB notes that its examiners found the following concerns when reviewing practices of student…
On September 16, the CFPB filed suit against Corinthian Colleges, Inc. in the Northern District of Illinois for engaging in alleged predatory student lending. This is the CFPB’s second predatory student lending suit against a for-profit college; the first being against ITT (reported by LenderLaw Watch here). The allegations and relief…
On January 22, New York Governor Andrew Cuomo announced that in its first action, the newly created Student Protection Unit issued thirteen subpoenas to student debt relief companies as part of an investigation into allegations of improper fees and misleading advertising. The Student Protection Unit is a division within the…