Consumer Bureau Action Tracker

CFPB – Transworld Systems


State

Nationwide

Topics

Enforcement, Student Loans, Debt Collection

In September 2017, the CFPB took action against Transworld Systems, Inc. for “aggressively suing students for debts that they allegedly couldn’t prove were legitimate.” Transworld relied “on ‘false or misleading legal documents'” to sue students “and couldn’t prove that those being sued were the actual owners of the loans in dispute.”  Transworld was fined $2.5 million for its illegal debt collection practices.  

  • The CFPB “fined a student loan creditor, the National Collegiate Student Loan Trusts, and its debt collector [Transworld Systems] nearly $22 million, charging them for aggressively suing students for debts that they allegedly couldn’t prove were legitimate.” The companies “sued thousands of students by relying on ‘false or misleading legal documents’ and couldn’t prove that those being sued were the actual owners of the loans in dispute.” National Collegiate was “ordered to pay ‘at least $19.1 million,’ including initial redress to harmed consumers and a civil penalty.” Transworld was fined $2.5 million. [Roger Yu, “Loan creditor fined $19M for suing students with ‘false’ legal documents,USA Today, 09/18/17]

Status

Active


2017-CFPB-0018 9/18/2017 9/18/2017

CFPB Takes Action Against National Collegiate Student Loan Trusts, Transworld Systems for Illegal Student Loan Debt Collection Lawsuits
https://www.consumerfinance.gov/about-us/newsroom/cfpb-takes-action-against-national-collegiate-student-loan-trusts-transworld-systems-illegal-student-loan-debt-collection-lawsuits/

  • Consumer Financial Protection Bureau (CFPB)
  • Administrative filing
  • Nonbank
  • $2,500,000

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