Navient

naviant is barred from federal student loan servicing and has to pay 120 million in fines and compensation to the borrowers harmed by its practices according to a proposed settlement with the Consumer Financial Protection Bureau the Accord announced Thursday comes nearly eight years after the cfpb sued naviant formerly known as Sally May naviant directed student loan borrowers into more costly repayment plans and away from lower cost income-based choices an investigation by the cfpb found naviant is looking at paying 100 million to be dispersed among hundreds of thousands of borrowers and 20 million in fines the proposed brings an end to litigation initially filed by the federal Watchdog in 2017 in federal court in Pennsylvania the company was then the country's biggest servicer of student loans overseeing more than 12 million borrowers noted the cfbb the loans servicing giant allegedly mismanaged Payment Processing hurting the credit of disabled borrowers whose loans had to be discharged the agency contended today we are closing the book on naviant one of the worst offenders in the student loan servicing industry and a company that has harmed millions of borrowers across the country cfpb director Rohit Chopra told reporters on Thursday naviant no longer buys or sells federal student loans after transferring dur in contract to another company in 2021 while we do not agree with the cfpb's allegations this resolution is consistent with our go forward activities and is an important positive milestone in our transformation the hearnden Virginia based company said Thursday in a statement it agreed earlier in the year to Outsource student loan servicing of certain Legacy portfolios for years naviant top Executives profited handsomely by exploiting students and taxpayers choer said in the statement by Banning the notorious student loan giant from federal student loan servicing and ensuring the wind down of these operations the cfpb will finally put an end to years of abuse the deal means hundreds of thousands of people will be compensated a cfpb official said Thursday during a press call the cfpb said it would mail checks to people eligible to be compensated under the settlement consumers do not need to do anything to obtain redress and should be aware of scammers that may try to use cfpb employees names and imagery try to steal money or private information the cfpb will never require consumers to pay money to obtain redress nor will we ask for additional information before consumers can cash a redress check that we've issued the agency cautioned the settlement is not a first for the company in 201 22 it reached a $1.85 billion Accord with 39 States and agreed to cancel about $66,000 student loans to settle claims that engaged in predatory lending processes