- Senator Elizabeth Warren said Navient CEO John Remondi is expected to be fired at a hearing on Tuesday.
- Navient, one of the largest administrators of student loans, has been accused of misleading borrowers.
- Remondi said the allegations were false and “not necessarily based on facts”.
Navient CEO John Remondi was with Senator Elizabeth Warren of Massachusetts’ first hearing on student debt relief. Warren told Remondi he should be fired for cheating on student loan borrowers, but that wasn’t all.
“The federal government should absolutely fire Navient, and because this happened under your leadership, Navient should fire you,” Warren told Remondi at the hearing.
—Elizabeth Warren (@SenWarren) April 13, 2021
Warren, as chairman of the Senate Economic Policy Subcommittee, called 11 witnesses to testify at the hearing to discuss the impact of student debt on borrowers, racial justice and the economy.
Warren said in it letter to Remondi inviting him to testify at the hearing that, although Navigate currently provides federal loans to 5.6 million borrowers and holds more than $ 58 billion a year in Federal Family Education Loans Program (FFELP) loans guaranteed by the federal government, he also “contributed to the problem, with a ten-year history of allegations of practical abuse and deception targeting student loan borrowers.
She added that between 2009 and 2019, Navient was charged or fined for “actions that scammed borrowers,” including improper marketing of loans and failure to inform borrowers of their rights.
And an ongoing Consumer Financial Protection Bureau investigation found that Navient “consistently referred thousands of borrowers who were having difficulty paying their loans to plans that were worse for borrowers – but more profitable for Navient.”
In February, three student loan borrowers filed a lawsuit against Navient, arguing that Navient owed them more than $ 45,000 in overpayments the company wrongly received after their student loans were paid off. This followed a decision by the Ministry of Education that Navient must repay the government $ 22 million in overcharged student loan grants.
In response to Warren’s questions about the Navient investigations, Remondi said his job is “obviously to comply with the rules and the laws, and we are working hard to make sure all borrowers successfully manage their loans.”
“These allegations are not true,” Remondi said. “These are accusations and not necessarily based on facts,” he added.
Representative Ayanna Pressley of Massachusetts, Maura Healey, Attorney General of Massachusetts, and James Steeley, President and CEO of the Pennsylvania Higher Education Assistance Agency, also testified at the hearing.