Tuesday, January 24, 2017

STUDEN LOAN SERVICER NAVIENT FUCKS OVER AMERICA'S YOUTH - US student loan corporation faces lawsuit for cheating millions

US student loan corporation faces lawsuit for cheating millions

US student loan corporation faces lawsuit for cheating millions
By Seb Gomez
24 January 2017
Navient, the largest servicer of student loans in the United States, has recently been targeted by the Consumer Financial Protection Bureau (CFPB) and the state attorneys general of Washington and Illinois for misleading borrowers and other illegal practices that increased the loan repayment costs for millions.
Navient oversees some $300 billion in student loans for more than 12 million borrowers, 6 million of which are under contract with the Department of Education. In total the Delaware-based corporation, which was formed out of Sallie Mae in 2014, accounts for nearly one fourth of all student loan borrowers. The lawsuit alleges that every account may have been affected by the malpractice.
Navient is charged with misleading borrowers away from cheaper income-based payment plans in order to inflate loans with higher interest rates. Borrowers are legally allowed to change payment plans as they please. However, Navient is accused of advising its customer service employees to press customers away from the income-based plans and into forbearance, a short-term postponement of payment normally appropriate for those with temporary financial difficulty.
Those placed into forbearance without proper knowledge of the terms face significantly higher costs, which generally increase the longer the payments are postponed. Such costs include the accumulation of unpaid monthly interest and the addition of unpaid interest to the principal balance of the loan, resulting in a recalculation of the loan based on the compounded interest.
The court filing concluded that from 2010 to 
2015, Navient enrolled 1.5 million borrowers 
in two or more consecutive forbearances, 
more than 470,000 in three consecutive 
forbearances, and 520,000 in four or more. 
In total this amounted to nearly $4 billion in 
extra interest revenue for the company over 
those 5 years.
The lawsuit points out that Navient customer service employees had been incentivized to mislead customers. The longer the call, the less these workers are paid. The process to transition a customer into an income-based payment plan requires multiple and lengthy conversations as well as an online or paper application with income tax documentation.
By contrast, forbearance enrollment can be completed with one phone call and without any paperwork. These findings reveal that the company’s practices had effectively ensured that the employees tasked with helping customers would be financially burdened to actually do so.
Navient also neglected to inform those able to enroll in income-based plans that their enrollment required recertification after a 12-month period. The lawsuit notes that failure to recertify in a timely manner typically increases monthly payments by hundreds to even thousands of dollars and delays the progress toward loan forgiveness.
In addition to Navient’s cost-cutting and selective presentation of information to student loan holders, the company is charged with careless overview of the accounts of injured military veterans. Permanently injured veterans are eligible to have their federal student loans discharged. However, on numerous accounts, Navient improperly marked the forgiven loans as defaults, ruining veterans’ credit scores.

Navient and its predecessor, Sallie Mae, have a history of government lawsuits and investigations spanning nearly two decades.
In 2014, Navient was fined $60 million by the Justice Department and the Federal Deposit Insurance Corporation (FDIC) for illegally overcharging military customers. That lawsuit found that the company had intentionally ignored the Servicemembers Civil Relief Act, which caps loan interest rates at 6 percent for active military personnel. In 2008, Sallie Mae struck a settlement with the state of New York for $2 million for conflict of interest practices. The company was found to have been paying for the entertainment and travel expenses of school officials it was doing business with.
The recent filing by the CFPB came just two days before the inauguration of now President Donald Trump. The New York Times reported that immediately following the November election, Navient’s stock value rose to nearly $18 from around $13, reflecting speculation among shareholders that the incoming administration would move to further deregulate finance— including the potential dismemberment of the CFPB.
The CFPB was established by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. Since its inception, Republican politicians have unanimously opposed the largely harmless organization, but now with Republican control of the House, Senate and White House, even such nominal reforms can be expected to be pulled back in the near future.
Currently, total student debt towers at more 
than $1.4 trillion, surpassing both credit card 
and auto loan debt. A report released earlier 
this month by the CFPB also found that the 
number of Americans aged 60 and over still 
paying for student debt has quadrupled since 
2005, increasing from 700,000 to 2.8 million

THE  GIG JOB – In America, No Legal Need Apply

"Possibly most affected by this shift in the economy is the 

Millennial generation, those  aged 18-30. The report notes that 

more than half of those under age 25 participate in independent 

work, not just in the United States but throughout the European 

Union as well."






The new reports show that in addition to “traditional” coping strategies of skipping meals and eating cheap food, these teens and pre-teens are increasingly forced into shoplifting, stealing, selling drugs, joining a gang, or selling their bodies for money in a struggle to eat properly.


Report on the impact of OBAMA-



AMERICA: One paycheck and two illegals away from homelessness.

"The economists found that the pre-tax share of national income received by the
bottom half of the US population has been cut nearly in half since 1980, from 20
percent to 12 percent, while the income share of the top one percent has nearly
doubled, from 12 percent to 20 percent."



“In the US, the working class will confront a government 

unlike any other in American history, which will continue and

intensify a decades-long social counterrevolution overseen by 

the Democrats and Republicans. The incoming Trump 

administration is manned by billionaires, generals and arch 

reactionaries. It is a government of, by and for the oligarchy, 

committed to destroying every remaining gain won by 

workers over the past century.”

Senate moves toward confirmation of billionaire opponent of public schools

Senate moves toward confirmation of billionaire opponent of public schools

By Isabelle Belanger 
25 January 2017
The confirmation of Trump’s pick for education secretary, billionaire proponent of school privatization Betsy DeVos, is being rushed through despite blatant conflicts of interest and her ignorance of basic federal education laws. In a letter Monday, Tennessee Republican Senator Lamar Alexander, chairman of the Senate Committee on Health, Education, Labor & Pensions, rejected Democratic Party requests for a second hearing. The Republican-controlled Senate will vote on the confirmation January 31.
DeVos and her husband are estimated to have a net worth of $5 billion. Her family has donated a quarter of million dollars to four of the senators—including Alexander—present at her first education committee hearing on January 17. The family has paid nearly a $1 million to 21 Republican senators who will vote on her confirmation next week, in addition to the $2.25 million the DeVos’ gave last fall to the Senate Leadership Fund, a super PAC tied to Senate Majority Leader Mitch McConnell.
The first hearing took place before the Office of Government Ethics was able to review the immense DeVos financial holdings for potential conflicts of interests. Both Dick and Betsy DeVos have investments and political ties to numerous organizations committed to school privatization and right-wing religious objectives, which could directly benefit from her confirmation.
One involves the student loan collection agency Performant, 

which does business with the Department of Education. The 

family’s private investment and management firm, RDV 

Corporation, is affiliated with LMF WF Portfolio, a limited 

liability corporation listed in regulatory filings as one of 

several firms involved in a $147 million loan to Performant 

Financial Corporation, the Washington Post reported.
Performant had 14 contracts worth more than $20 million—equivalent to 23 percent of its revenue—with the Department of Education. It recently lost a contract bid and is now protesting the decision with the Government Accountability Office.
If confirmed, the Post reported, “DeVos would be in 

a position to influence the award of debt collection, 

servicing and recovery contracts, in addition to the 

oversight and monitoring of the contracts. She 

would also have the authority to revise payments 

and fees to contractors for rehabilitating past-due 

Rejecting the request for a second hearing, Alexander said DeVos was currently answering “837 written follow-up questions” and that she has already “spent considerably more time answering questions of committee members than either of President Obama’s education secretaries. I do not know why our committee should treat a Republican nominee so differently than the nominee of a Democratic president.”
During the January 17 hearing DeVos demonstrated her hostility towards public education and the basic democratic principle that all children, regardless of socio-economic background, race or disabilities, should be provided a high-quality public education.
After being asked if she agrees that all schools—public, charter or private—that receive federal funding should be required to comply with the Individuals with Disabilities Education Act (IDEA), a federal civil rights law, she responded that it would be a “matter … best left to the states.” She then referred to a Florida program that requires parents to sign away their IDEA rights in exchange for a private school voucher.
When asked by Sen. Tim Kaine (D-Va.) if all schools receiving federal funds, whether public, charter or private schools receiving voucher money, should be held to the same standards of accountability, she repeatedly evaded the question, stating only that she supports “accountability.”
When questioned about gun-free zones around schools, proposed after the Sandy Hook, Connecticut school massacre in 2012, DeVos gave a bizarre answer citing the need for guns to protect against grizzly bear attacks in a Wyoming school.
As the World Socialist Web Site detailed in its series, “Betsy DeVos: Religion and profit in the war on public education” (Part One and Part Two), the appointment of DeVos is aimed at destroying public education and funneling even more public money into the hands of for-profit charter operators, religious institutions and other businesses. She is one of several Trump cabinet and sub-cabinet selections, including for the departments of Health and Human Services, Housing and Urban Development and Labor, as well as the EPA, who are tasked with destroying social reforms that the corporate and financial oligarchy considers illegitimate deductions from their profit.
DeVos, the former Republican Party chairwoman in Michigan and chair of the school privatization group American Federation for Children, pushed for laws for the use of public funds to pay for private school tuition and the spread of charter schools, with little or no oversight. Michigan now has one of the highest number of charters and largest percentage run by for-profit companies in the country.
Last week, the state School Reform Office announced that 38 schools—including 24 in Detroit—could soon be closed because they have ranked in the bottom five percent for academic performance since 2014. If the schools are not closed, under the state’s law, academics can be put under the control of a CEO, the principal and half the staff can be replaced or the school could be converted into a charter school.
The grandstanding of the Democrats as the defenders of public education, however, is completely fraudulent. The stage was set for DeVos by the Democrats who have colluded with the Republicans in a decades-long assault on public education. In the 1990s, President Bill Clinton first adopted the right-wing, pro-market nostrums of “school choice” long promoted by the Republican right and it has been central to the Democratic Party, on the federal, state and local level, ever since.
For eight years, the Obama administration and congressional Democrats worked with Republicans to implement and intensify the anti-public-school measures contained in the Bush administration’s No Child Left Behind Act of 2001. The use of standardized tests to scapegoat teachers for the educational problems caused by decades of school cuts and the growth of poverty escalated under Obama. Restrictions on allocations of Title I funding, intended to increase financial support to schools serving high percentages of students in poverty, were replaced by competitive grants known as Race To The Top, pitting poor schools against each other in a competition for desperately needed Title I funds. The number of students in charter schools more than doubled under Obama and his education secretary, Arne Duncan.
Far from “grilling” DeVos at the hearing, Democrats never asked about her financial and political ties to organizations such as the Acton Institute, which is dedicated to ending compulsory education for children and legalizing child labor. In the end, this was political theater.
Committee members include Patty Murray (D-Washington), who has long experience collaborating with Republicans to enact deep social cuts, Hillary Clinton’s former running mate Tim Kaine (D-Virginia), who called for a 26 percent reduction in funding to public colleges and universities in Virginia in his final term as Governor, and Elizabeth Warren (D-Massachusetts) who, in her book, The Two Income Trap: Why Middle-Class Parents Are Going Broke, (2003), called for the introduction of a universal school voucher that would allow families to send their children to any public school, which would to the closure of many inner-city schools.
The handing of the education secretary’s position to a billionaire and avowed enemy of public education will lead to an immense escalation of the war against this most basic democratic right. Neither the Democrats nor the teacher unions will do anything to oppose these attacks. The American Federation of Teachers and the National Education Association, which openly collaborated with Obama, will, if anything, be more willing to offer up their services in suppressing the opposition by teachers, out of fear that they will be cut out of the process of pro-business “school reform.”
The coming months and years will see the eruption of social opposition to the destruction of public education. This must be politically independent from both corporate-controlled parties and advance an anti-capitalist program against the domination of society by the corporate and financial aristocracy, which is now putting one of its own in charge of public education.

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