Skip to content
ADVERTISEMENT
Sign In
  • Sections
    • News
    • Advice
    • The Review
  • Topics
    • Data
    • Diversity, Equity, & Inclusion
    • Finance & Operations
    • International
    • Leadership & Governance
    • Teaching & Learning
    • Scholarship & Research
    • Student Success
    • Technology
    • Transitions
    • The Workplace
  • Magazine
    • Current Issue
    • Special Issues
    • Podcast: College Matters from The Chronicle
  • Newsletters
  • Virtual Events
  • Ask Chron
  • Store
    • Featured Products
    • Reports
    • Data
    • Collections
    • Back Issues
  • Jobs
    • Find a Job
    • Post a Job
    • Professional Development
    • Career Resources
    • Virtual Career Fair
  • More
  • Sections
    • News
    • Advice
    • The Review
  • Topics
    • Data
    • Diversity, Equity, & Inclusion
    • Finance & Operations
    • International
    • Leadership & Governance
    • Teaching & Learning
    • Scholarship & Research
    • Student Success
    • Technology
    • Transitions
    • The Workplace
  • Magazine
    • Current Issue
    • Special Issues
    • Podcast: College Matters from The Chronicle
  • Newsletters
  • Virtual Events
  • Ask Chron
  • Store
    • Featured Products
    • Reports
    • Data
    • Collections
    • Back Issues
  • Jobs
    • Find a Job
    • Post a Job
    • Professional Development
    • Career Resources
    • Virtual Career Fair
    Upcoming Events:
    Hands-On Career Preparation
    An AI-Driven Work Force
    Alternative Pathways
Sign In
Ticker circle logo

The Ticker

Breaking news from all corners of academe.

Education Dept. to Drop 5 Collection Agencies Over ‘Deceptive Practices’

By Andrew Mytelka March 1, 2015

[Updated (3/2/2015, 12:35 p.m.) with response from a trade association representing the five agencies.

To continue reading for FREE, please sign in.

Sign In

Or subscribe now to read with unlimited access for as low as $10/month.

Don’t have an account? Sign up now.

A free account provides you access to a limited number of free articles each month, plus newsletters, job postings, salary data, and exclusive store discounts.

Sign Up

[Updated (3/2/2015, 12:35 p.m.) with response from a trade association representing the five agencies.]

The U.S. Education Department is cutting ties with five private collection agencies that it says provided inaccurate information to student-loan borrowers. In an announcement late Friday, the department also said it would step up its monitoring and guidance of such collection agencies, which work under government contracts, to ensure that they give borrowers accurate data on their loans.

The measures announced on Friday stem from the department’s review of the 22 private collection agencies it contracts with. The review focused on whether the agencies were complying with requirements that they “not engage in unfair or deceptive practices” and observe relevant federal and state laws.

ADVERTISEMENT

The review followed sharp criticism by consumer advocates and some members of Congress. The critics said the department should not contract with companies accused of violating consumer-protection laws and should instead handle itself any debt collection on student loans it issues. Making such a change would radically alter a business model that has resulted in hundreds of millions of dollars in payments to loan-collection companies over the last few years.

In its review, the department found that the five agencies had misled borrowers about the loan-rehabilitation program, which enables borrowers to get out of default by making a series of on-time payments. The agencies provided deceptive information about the effect on borrowers’ credit reports and the waiver of some collection fees, the department said.

Late Sunday the National Council of Higher Education Resources, a trade association representing four of the five agencies, among other loan collectors and servicers, issued a news release criticizing the department for failing to “provide details of the alleged findings to the impacted agencies” before taking action against them.

“The five impacted agencies should have the opportunity to respond to the allegations before losing their contracts,” said the council’s president, James Bergeron.

Borrowers whose loan accounts have been held by the five agencies, but who are not in repayment, will be reassigned to other loan-collection agencies, the department said. The agencies whose contracts will not be renewed are Coast Professional, Enterprise Recovery Systems, National Recoveries, Pioneer Credit Recovery, and West Asset Management.

Of the five, only Pioneer Credit appeared on a recent tally of debt-collection companies that had racked up the most complaints from borrowers with the Federal Trade Commission and the Consumer Financial Protection Bureau.

We welcome your thoughts and questions about this article. Please email the editors or submit a letter for publication.
Share
  • Twitter
  • LinkedIn
  • Facebook
  • Email
Mytelka_Andrew.jpg
About the Author
Andrew Mytelka
Andrew Mytelka was assistant managing editor for copy at The Chronicle.
ADVERTISEMENT
ADVERTISEMENT

More News

Photo-based illustration of a mirror on a green, patterned wallpaper wall reflecting Campanile in Berkeley, California.
A Look in the Mirror
At UC Berkeley, the Faculty Asks Itself, Do Our Critics Have a Point?
illustration of an arrow in a bullseye, surrounded by college buildings
Accreditation
A Major College Accreditor Pauses Its DEI Requirements Amid Pressure From Trump
Photo-based illustration of the Rotunda at the University of Virginia obscured by red and white horizontal stripes
'Demanding Obedience'
How Alums Put DEI at UVa in the Justice Dept.’s Crosshairs
Colin Holbrook
Q&A
‘I Didn’t Want to Make a Scene’: A Professor Recounts the Conversation That Got Him Ejected From Commencement

From The Review

American artist Andy Warhol, posing in front of The Last Supper, a personal interpretation the American artist gave of Leonardo da Vinci's Il Cenacolo, realized 1986, belonging to a series dedicated to Leonardo's masterpiece set up in palazzo delle Stelline; the work holds the spirit of Warhol's artistic Weltanschauung, demystifying the artwork in order to deprive it of its uniqueness and no repeatibility. Milan (Italy), 1987.
The Review | Essay
Were the 1980s a Golden Age of Religious Art?
By Phil Christman
Glenn Loury in Providence, R.I. on May 7, 2024.
The Review | Conversation
Glenn Loury on the ‘Barbarians at the Gates’
By Evan Goldstein, Len Gutkin
Illustration showing a valedictorian speaker who's tassel is a vintage microphone
The Review | Opinion
A Graduation Speaker Gets Canceled
By Corey Robin

Upcoming Events

Ascendium_06-10-25_Plain.png
Views on College and Alternative Pathways
Coursera_06-17-25_Plain.png
AI and Microcredentials
  • Explore Content
    • Latest News
    • Newsletters
    • Letters
    • Free Reports and Guides
    • Professional Development
    • Virtual Events
    • Chronicle Store
    • Chronicle Intelligence
    • Jobs in Higher Education
    • Post a Job
  • Know The Chronicle
    • About Us
    • Vision, Mission, Values
    • DEI at The Chronicle
    • Write for Us
    • Work at The Chronicle
    • Our Reporting Process
    • Advertise With Us
    • Brand Studio
    • Accessibility Statement
  • Account and Access
    • Manage Your Account
    • Manage Newsletters
    • Individual Subscriptions
    • Group and Institutional Access
    • Subscription & Account FAQ
  • Get Support
    • Contact Us
    • Reprints & Permissions
    • User Agreement
    • Terms and Conditions
    • Privacy Policy
    • California Privacy Policy
    • Do Not Sell My Personal Information
1255 23rd Street, N.W. Washington, D.C. 20037
© 2025 The Chronicle of Higher Education
The Chronicle of Higher Education is academe’s most trusted resource for independent journalism, career development, and forward-looking intelligence. Our readers lead, teach, learn, and innovate with insights from The Chronicle.
Follow Us
  • twitter
  • instagram
  • youtube
  • facebook
  • linkedin