CFPB Warns Student Loan Servicers against Unlawful Collections

The CFPB warned student loan servicers against attempting to collect on private student loans that had been discharged in bankruptcy.

In a Compliance Bulletin, the CFPB addressed reports of unlawful collection efforts by student loan servicers. According to CFPB Director Rohit Chopra, the agency found that some servicers have been ignoring bankruptcy court orders. The CFPB made clear that it expects student loan servicers to (i) proactively identify student loans that are discharged, (ii) stop all unlawful collections and (iii) issue refunds to all consumers who had been forced to make payments as a result of past unlawful collections.

The CFPB stated that it will continue to examine student loan servicers and hold all violators accountable.