Whenever average Americans rip off insurance companies, it generally gets reported widely. Hard working honest Americans are usually appalled. Most importantly, the perpetrators of the crime are generally sent to jail. After-all, if there is no penalty for cheating, said cheating will continue and grow.
Huffington Post reported the following.
The U.S. Department of Education will pay its oft-criticized student loan servicers more money under new contracts that the White House demanded in response to the companies’ lack of adequate customer service.
An Education Department official acknowledged the bump in pay on Wednesday during a testy exchange with Sen. Elizabeth Warren (D-Mass.).
“Let me get this straight: You break the law. You don’t follow the rules. You treat the borrowers badly,” Warren said of the loan servicers. “And you all just renegotiated the contracts to make sure that across the portfolio [loan servicers] are going to make a little more money if nothing changes?”
Senator Elizabeth Warren could not be clearer as she drilled William Leith, Chief Business Operations Officer, Federal Student Aid, U.S. Department of Education. This is modus operandi . Read his written testimony here submitted to the U.S. Senate Committee on Aging hearing on the subject “Indebted for Life: Older Americans and Student Loan Debt” on September 10th, 2014.
When the thugs on Wall Street brought down the worlds economy, the American taxpayers bailed them out. Funny thing is that none of these thugs went to jail. They kept their three piece suits on and extorted their continued bonuses. One wonders why it would not be much more efficient to nationalize the banking sector.
According to the Washington Post
Government officials hit Sallie Mae and its former subsidiary Navient Solutions with $97 million in fines Tuesday for unlawfully charging active-duty service members high interest rates and late fees on student loans.
“We are sending a clear message to all lenders and servicers who would deprive our service members of the basic benefits and protections to which they are entitled: This type of conduct is more than just inappropriate, it is inexcusable. And it will not be tolerated,” Attorney General Eric H. Holder Jr. said at a news conference.
In a complaint filed Tuesday, federal prosecutors said that Sallie Mae employees violated the Service members Civil Relief Act (SCRA), a federal law that extends legal and financial protections to military personnel.
Company staff denied some borrowers’ benefit requests and stuck others with more than $500 in excess interest. And when soldiers fell behind on payments, Sallie Mae took legal action against them without documenting their military service, in violation of the law, according to the complaint.
So much for honoring our troops. Yet student loan servicers renegotiated contracts that paid them more to continue servicing student loans.