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The Consumer Financial Protection Bureau on Wednesday sanctioned Edfinancial Services, a student loan servicer, for making deceptive statements to student loan borrowers and misrepresenting their forgiveness and repayment options to them. Edfinancial “deceived borrowers with Federal Family Education Loan Program loans about their eligibility for Public Service Loan Forgiveness,” the bureau said.
The bureau is ordering the company to contact all affected borrowers, provide them with accurate information and pay a $1 million civil penalty.
Edfinancial Services released a statement this morning that said it “strenuously” rejected the allegations.
However, the statement added, “facing protracted and costly litigation that would have distracted us from our day-to-day responsibilities to our clients, borrowers and staff, we have settled the case with the CFPB with a payment of $1 million and agreed to update our training for staff servicing FFELP loans.”
