Friday, October 18, 2019

Status of CFPB v. National Collegiate Student Loan Trust in Delaware USDC (filed in 2017)

The relevant item in the Bureau's most recent semi-annual report has this to say (not much): 

Consumer Financial Protection Bureau v. The National Collegiate Master Student Loan Trust, et al. (D. Del. No. 17-cv-1323). 
On September 18, 2017, the Bureau filed a complaint and proposed consent judgment against several National Collegiate Student Loan Trusts (collectively, “NCSLT”). The Bureau alleges that NCSLT brought debt collection lawsuits for private student loan debt that the companies could not prove was owed or was too old to sue over; that they filed false and misleading affidavits or provided false and misleading testimony; and that they falsely claimed that affidavits were sworn before a notary. The proposed consent judgment against the NCSLT would require an independent audit of all 800,000 student loans in the NCSLT portfolio. It would also prohibit the NCSLT, and any company it hires, from attempting to collect, reporting negative credit information, or filing lawsuits on any loan the audit shows is unverified or invalid. In addition, it would require the NCSLT to pay at least $19.1 million, which would include redress to consumers, disgorgement, and a civil money penalty. Soon after the Bureau’s filing, several entities moved to intervene to object to the proposed consent judgment. The judge granted the intervention motions, and the parties are currently engaged in discovery. The case remains pending. 


Also see prior posts on the CFPB v. Nat’l Collegiate Student Loan Trust and related litigation:
Update on Wrangle over NC Trust Asset Control: Delaware Magistrate okays Odyssey's designation as servicer of 6 Trusts in row between Indenture Trustee U.S. Bank and NCSLT trust certificate owners; overrules all of US Bank's objections (May 7, 2018)

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