Report blasts Education Department for failing to hold student loan servicers accountable for treating borrowers fairly
WASHINGTON, D.C. – Consumer Reports called on state lawmakers and attorneys general to protect borrowers in light of a damning new Inspector General’s report finding that the Education Department has failed to stop Navient and other top student loan servicers from treating borrowers unfairly. The audit found that the Department rarely took action to hold servicers accountable, despite clear evidence that they were failing to inform struggling borrowers of their legal rights to access flexible repayment options and miscalculated how much was owed under income-driven repayment plans.
“Today’s audit makes clear that the Department of Education has repeatedly looked the other way despite overwhelming evidence that Navient and other student loan servicers have been cheating borrowers for years,” said Suzanne Martindale, senior policy counsel for Consumer Reports. “Instead of holding these companies accountable for recurring abuses, the Department has worked to shield them from greater scrutiny by state law enforcement agencies. It’s clear that we cannot count on the Department to police these widespread abusive practices, and it’s time for states to take action to protect struggling borrowers who are doing their best to repay their loans.”
Michael McCauley: mmccauley@consumer.org, 415-431-6747, ext. 7606