December 12, 2013

Senator Warren Questions Treasury and ED on Accountability for Sallie Mae Rulebreaking and Violations

Update (12/12): See Response from Department of Education here.

The full text of Senator Warren's letter is available here.

WASHINGTON, DC - United States Senator Elizabeth Warren today (9/19) sent a letter to Treasury Secretary Jacob Lew and Education Secretary Arne Duncan questioning their departments' ongoing relationship with Sallie Mae despite Sallie Mae's pattern of breaking the rules and ignoring its contractual obligations.

"While the government has been quite tolerant of Sallie Mae's failings and helped Sallie Mae maintain its profitability, it is not nearly as generous when it comes to student borrowers," wrote Senator Warren. "For students who default on their federal loans, the accountability is relentless....Where is that kind of accountability for Sallie Mae?"

In the letter, Senator Warren asks Secretary Lew and Secretary Duncan what actions they have taken to hold Sallie Mae accountable for its repeated failings, including the improper marketing of federal student loans and violations of contractual obligations regarding debt collection. Since 2009, the federal government has given Sallie Mae government contracts worth hundreds of millions of dollars.