Fiery Senate Hearing on Student Loans

Forbes has an account here. Forbes has a paywall but if you haven't read any Forbes articles this month, you should be able to read the article. There's a lot in the article worth reading, but here's a short excerpt:

Senator Warren opened the hearing by highlighting how student loan debt exacerbates the racial wealth gap, noting that, “After 20 years, the median Black borrower still owes 95% of the original amount borrowed." Dr. Dominique Baker, Assistant Professor of Education Policy at Southern Methodist University, later examined this in further detail, arguing that, “The burden of student loan debts disproportionately falls” on Black borrowers due to “centuries of structural forces shaped by the deliberate decisions of those in power. Structural racism has denied Black families the ability to build wealth to pay for college.”

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Navient has come under withering criticism for its student loan practices. Last month, a state court in Washington concluded that the company had deceived scores of private student loan borrowers and cosigners about their ability to release the cosigner on a student loan at a later date if certain criteria were met — such as by making on-time payments for consecutive months over the course of years. In February, a federal administrative law judge ruled that Navient must repay the government over $22 million for allegedly overcharging the Department of Education for student loan subsidies. And student loan borrowers tried to force Navient into an involuntary bankruptcy last month for allegedly charging borrowers for student loans that had already been discharged; a judge ultimately dismissed that suit, which Navient had claimed was frivolous.

Meanwhile, a long-running lawsuit against Navient brought by the Consumer Financial Protection Bureau (CFPB) — an agency that Senator Warren helped establish in the wake of the 2008 financial crisis — is ongoing. * * *

Senator Warren said to Mr. Remondi during the questioning phase of the hearing that given the ongoing allegations of wrongdoing, “the federal government should fire Navient — and the federal government should fire you.” During subsequent questioning by Senator Bob Menedez (D-NJ), Mr. Remondi admitted to being “well compensated” by Navient, earning upwards of $20 million in compensation over the course of several years, despite the avalanche of allegations of misconduct by the company.

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