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ARTICLE · 21 OCTOBER 2015

State AGS In The News - October 15th, 2015

Blank Rome
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The Consumer Financial Protection Bureau (CFPB) is allegedly investigating Wells Fargo & Co. over its student loan servicing practices.

United StatesConsumer Protection
Aaron R. Lancaster
Aaron R. Lancaster
Doreen Manchester
Doreen Manchester
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Consumer Financial Protection Bureau

CFPB Continues to Scrutinize Student Loan Servicers

  • The Consumer Financial Protection Bureau (CFPB) is allegedly investigating Wells Fargo & Co. over its student loan servicing practices. The exact issue with Wells Fargo remains undisclosed, and the bank transferred the servicing of its federal student loan portfolio to third parties in 2011. It does, however, remain the second largest servicer of private student loans by volume.
  • The CFPB is showing increased interest in student loan servicing. In July, the CFPB brought its first enforcement action against a servicer, alleging that Discover Bank violated the Consumer Financial Protection Act and the Fair Debt Collection Practices Act when it overstated the minimum amount to be paid and failed to inform borrowers of their rights. In addition, the CFPB continues to investigate Navient Solutions, Inc., the largest student loan servicer.

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