Defrauded student loan borrowers seeking relief from the Obama administration are confronting an Education Department process that a senior House Democrat compared to the government’s bungled response to the mortgage robo-signing crisis that shook the U.S. housing market. In the case of robo-signed mortgage documents, bank regulators at the Office of the Comptroller of the Currency and Federal Reserve in 2011 created a time-consuming process to evaluate each borrower’s claim. Banks spent more than $2 billion to process the claims without a single dollar going to aggrieved borrowers before regulators aborted the plan in 2013 in favor of cash payouts and mortgage assistance. To Rep. Maxine...
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