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ARTICLE · 04 JUNE 2024

CFPB Files Suit Against Student Loan Servicer

Goodwin Procter LLP
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On May 31, 2024, the CFPB announced that it had filed suit against a Pennsylvania-based student loan servicer for engaging in allegedly unfair, deceptive and abusive acts or practices in violation of the CFPA...

United StatesInsolvency/Bankruptcy/Re-Structuring
Jordan Wenik
Jordan Wenik

On May 31, 2024, the CFPB announced that it had filed suit against a Pennsylvania-based student loan servicer for engaging in allegedly unfair, deceptive and abusive acts or practices in violation of the CFPA, 12 U.S.C. §§ 5531, 5536(a)(1)(B), and for failing to establish reasonable credit reporting procedures in violation of Regulation V, 12 C.F.R. §§ 1022.40-43, and the CFPA, 12 U.S.C. § 5536(a)(1)(A).

According to the CFPB's complaint filed in the Middle District of Pennsylvania, the company allegedly improperly collected or attempted to collect on private student loans that had been discharged in a bankruptcy proceeding. The CFPB alleges that the company maintains a policy of resuming servicing and collection on all private student loans after the conclusion of a bankruptcy proceeding, unless explicitly directed otherwise by the consumer or it receives a court order. The CFPB asserts that the company does not track and lacks proper procedures to determine

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