14 May 2014

DOJ: Student loan entity penalized for cheating veterans | RallyPoint.com

Military News - DOJ: Student loan entity penalized for cheating veterans

Image Copyright: Meredith Tibbetts/Stars and Stripes

By Chris Carroll
Copyright: Stars and Stripes

WASHINGTON — The student lender Sallie Mae, which in recent weeks reorganized into separate corporations, agreed to pay almost $100 million in compensation and penalties for overcharging military members who took out education loans.

Under an agreement reached with the Department of Justice announced Tuesday, Navient Corp., which took over Sallie Mae’s student loan servicing business, agreed to pay $60 million in compensation and a $55,000 penalty for charging military members excessive student loan interest rates. A federal law, the Servicemembers Civil Relief Act, or SCRA, caps the rate at 6 percent.

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