Navient

Navient (formerly Sallie Mae) is now a Fortune 500 company, and Senator Elizabeth Warren (D-Massachusetts) doesn’t think this is anything to brag about.

The company is America’s largest servicer of federal student debt, with a portfolio of roughly $292 billion among 12 million student borrowers according to its 2019 investor packet. Navient holds roughly 20% of all $1.5 trillion in outstanding student debt, most of which comes in the form of federal loans from the U.S. Department of Education.

Last year, Navient was sued by California Attorney General Xavier Becerra for allegedly steering students into repayment plans that they knew they would be unable to meet at their current income levels, thereby pushing them further into debt and making them repay far more than they owed.

“By taking Navient to court, we’re sending a very strong message that these practices will not be tolerated,” Becerra said at the time.

The California lawsuit is similar to a separate suit filed in 2017 by the U.S. Consumer Financial Protection Bureau (the brainchild of Sen. Warren) which alleged that Navient “created obstacles to repayment by providing bad information, processing payments incorrectly, and failing to act when borrowers complained.”

“Through shortcuts and deception, the company also illegally cheated many struggling borrowers out of their rights to lower repayments, which caused them to pay much more than they had to for their loans,” a CFPB press release read.

Alleged practices like these may have helped Navient break back into the Fortune 500, which it bragged about on its official Twitter account on Friday. However, Navient’s tweet was soon subjected to “the ratio,” which is when a tweet has more responses than it has in combined likes and retweets. Some of those responses were particularly biting.

“You’re a gahdamn student loan company and you’re celebrating making boatloads of money off of kids trying to get an education? Holy shit this is why people are talking about guillotines,” wrote journalist Zach Roberts.

“You’re a force for evil and suffering in the world,” podcaster Dean Detloff wrote.

However, the most pointed response may have been from Sen. Warren, who blasted the company in a tweet calling them “scammers.”

“This student loan company is literally under investigation and being sued by states and the federal government for cheating students to make more money,” Warren tweeted. “But congrats on breaking into the , . I didn’t know they had a special section for scammers.”

One plank of Warren’s 2020 presidential campaign is the cancellation of student debt burdens under $50,000 for borrowers making less than $100,000/year. Warren’s campaign says this would result in the cancellation of 95% of all outstanding student debt. She would pay for the plan by her “ultra-millionaires” tax, which would tax all net worths in excess of $50 million to generate an estimated $2.75 trillion in revenue each decade.

 

Tom Cahill is a contributor for Grit Post who covers political and economic news. He lives in Bend, Oregon. Send him an email at tom DOT v DOT cahill AT gmail DOT com.

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