Behind the Lucrative Assembly Line of Student Debt Lawsuits
- 6 years ago
Behind the Lucrative Assembly Line of Student Debt Lawsuits
But many of the cases were flawed, as the debt collector churned out mass-produced documentation based on scant verification, according to legal filings by a federal regulator
and a New York Times analysis of court records from hundreds of cases.
Transworld Systems has been one of most prolific debt collectors, filing more than 38,000 lawsuits
in the last three years on behalf of a single client, the National Collegiate Student Loan Trusts.
“We pursue litigation as a last resort for a tiny fraction of individuals — less than 1 percent of defaulted private education loan borrowers —
and each case is individually reviewed and prepared,” Ms. Christel said.
National Collegiate and Transworld “sued consumers for student loans they couldn’t prove were owed
and filed false and misleading affidavits in courts across the country,” said Richard Cordray, the consumer bureau’s director.
Navient’s student loan trusts — the investment vehicles
that owned her debt — had not registered to do business in the state, she claimed in her legal filings.
But many of the cases were flawed, as the debt collector churned out mass-produced documentation based on scant verification, according to legal filings by a federal regulator
and a New York Times analysis of court records from hundreds of cases.
Transworld Systems has been one of most prolific debt collectors, filing more than 38,000 lawsuits
in the last three years on behalf of a single client, the National Collegiate Student Loan Trusts.
“We pursue litigation as a last resort for a tiny fraction of individuals — less than 1 percent of defaulted private education loan borrowers —
and each case is individually reviewed and prepared,” Ms. Christel said.
National Collegiate and Transworld “sued consumers for student loans they couldn’t prove were owed
and filed false and misleading affidavits in courts across the country,” said Richard Cordray, the consumer bureau’s director.
Navient’s student loan trusts — the investment vehicles
that owned her debt — had not registered to do business in the state, she claimed in her legal filings.